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How to increase your credit score before renting an apartment

credit score - renting apartmentcredit score - renting apartment
credit score - renting apartmentcredit score - renting apartment

 

How to increase your credit score before renting an apartment

You’ll know frustration if you’ve ever received a rejection letter from a landlord because you have a low credit score? This can be frustrating. Especially because there was never a "how to handle your credit score" class in high school. This, unfortunately, has left many South Africans with bad money management skills. 

But, don’t be discouraged because we are here to help you improve your credit score and continue to live a healthy credit life. These tips will help you ensure no other future endeavour is hindered because of this. 

But, first lets briefly explain how credit works. Because most people don't understand the correlation between a place to live and your credit score. Well, most landlords go through a prospective tenants credit score to check to see how big of a financial risk they are. 

Because, when you think about it, there isn't anything different with approaching a lender for vehicle financing and approaching a landlord for a place to rent. Because both parties need you to repay them each month for what they are offering e.g money to finance a new car or the roof over your head. 

And, if they approve someone who has a less-than-stellar credit history and score, the chances of them getting their money are slim. So, before they approve you, they need to ensure they're in an arrangement with a trustworthy tenant. 

But, don't be disheartened because there is a way to turn this around. So, continue reading and follow these steps. Soon, you'll become an eligible potential tenant. 

 

Check your credit history record

Although this does not happen to everyone, it's important to check your credit history. Unfortunately, scammers are finding new ways to catch their next victim. So, take a look at your history carefully and make sure you are aware of all the creditors that are listed. Make sure you also check to see if the debt amount has been changed if you have been paying. Sometimes there may be an issue where incorrect information is being pulled through. This can also be the reason why your score is low. So, take a moment to look at it and if there is anything strange, call the credit provider and inform them of the issue. They will tell you which route to take to clear yourself. 

 

Always make payments on time 

Many South Africans’ credit ratings are affected because they do not pay on time. Paying on time means paying on the agreed date between you and the creditor. This does not mean you can pay a day later or by the first week of a new month. Even though you have paid, you’re still flagged as a late payer which makes you seem unreliable. So, if you are looking for a way to show a real estate company in Johannesburg how good of a tenant you can be, then pay your bills on time. This will help to improve your score and show landlords that you are reliable and won’t miss or make any further late payments. 

 

Find yourself a co-signer

This is an effective solution if you need a flat to rent immediately. However, you need to find someone who has a good credit score who will testify for your financial reliability. For them to do that, they'll need to co-sign your lease. This is only effective if they have a good score. When they co-sign your rental lease, it means they will take the legal responsibility of ensuring the rent is paid every month. The catch here, which might prevent your friend or family member from vouching for you, is the fact that they will be liable to make the payment should you be unable to do so. This proves to your potential landlord that they will get their money one way or the other. So, if you have a family member who is willing to do this for you, it's worth the try. Remember that just because you have a co-signer, it does not mean you are not liable. This is still your expense, so don't make the person regret it. 

 

Pay off your outstanding debt

Paying off your debt won’t only increase your chances of getting the flat you want to rent, but it will also help you move forward to a debt-free life. So, try and start lowering your debt. You can do this by settling the smallest balances or by focusing on tackling the ones with the highest interest rate. Either way, you will be effectively doing something about your debt. Which will bring your utilisation ratio down, which is highly impactful on your credit score.

 

Final thoughts

Improving your score may take time, but even the small improvements will work in your favour. And, trust us, when you make these changes, they won’t go unnoticed and landlords will know you’re working tirelessly to improve your bad credit score. So, whether you are looking to rent a flat in Johannesburg or any other city, follow these steps and you’re guaranteed to find an affordable flat that you will still love. 

 

credit score - renting apartment