Clean up credit or wipe out as tenant
Many people underestimate the importance of having good credit in finding an apartment.
Virtually all landlords run credit reports on applicants. While the report doesn’t paint a full picture of who the applicant is, it does serve as a frame of reference.
What’s on the actual report?
Names and addresses used under the given Social Security number and date of birth are listed, including any hybrid names used, such as Jane Doe and Janet Smith Doe. Public record fines and liens, including bankruptcy, may be on the report. Installation balances, real estate balances and student loans are also classic. Credit card debt and open or closed credit accounts are duly noted. The applicant’s employer’s name and address may be included as well. There’s also a notation of who else asked about the credit and when.
Money borrowed is recorded, along with the total amount of the loan, payments remaining and amount still owed. Late payments are noted, varying from 30 days to the point of non-collection. College loans? Sallie Mae is ready to lend and tell. Credit reports are like a diary of consumer behavior.
Specific credit details can trail a person for up to seven years, bankruptcy for 10, according to the Federal Fair Credit Reporting Act. Its Web site is www.ftc.gov .
Credit card debt in 2000 was valued at $7 trillion, the Federal Reserve reported. That’s a lot of credit information. Since credit offers spring from everywhere, and for everything from mattresses to stereos, be careful to keep debt to a manageable size.
Why have credit? It lends credibility. Picture someone with little or no good credit. Most landlords won’t take them -- unless a good reason is given.
The law requires only that the same legal and personal standard is applied equally to all applicants. Requirements that allow discrimination against protected groups -- which are defined by race, religion, national origin, gender, age, marital status and physical disability -- are prohibited.
Since basic credit reports do not have actual “scores” or numbers on them, they are entirely subjective. Other positive criteria include a good job, fine pre-rental history and the ability to come up with the deposit. While having credit is no guarantee of getting a desired apartment, it does move the applicant in the right direction.
What if your report has some negative items? If you know the reason, be honest. Accounts sent to collection that aren’t mentioned just illuminate the suspicion. Shed light on the specifics, telling the person before your application is run.
Renting a place is borrowing space and money, and the landlord wants to be able to trust the tenant’s reliability.
What if you are innocent of the reported problem? Speak up and ask for a copy of the report right away. Whoever runs it is obligated, if you request, to have a copy sent to you, for no additional fee ($30 is the maximum credit fee).
The reporting agency, which always has a contact name, address and phone number at the bottom of the report, can provide answers. The person running the report cannot.
Contact the credit reporting agency and solve the problem from the source. Experian, (888) EXPERIAN; Equifax, (800) 685-1111, and TransUnion, (800) 888-4213, are the three main sources of credit reports.
Leasing is a gamble both ways. You want to be treated fairly, as does the landlord. In giving you the keys to their rental, they are extending credit as well.
Keep your credit clean. And, if there’s a problem, fix it.
H. May Spitz is a freelance writer in Los Angeles. Comments may be e-mailed to hmayspitz@aol.com, no attachments, please.
