Preparing for a Rental Open House

You graduated from college, found a job, and are now ready to move into your first big boy/girl apartment. Congrats!

You looked through Craigslist and found several possible contenders. Some have open houses, for others you called/emailed and made an appointment. But you should do more than just show up at the designated time. (Though do show up a few minutes early to maximize your alone time with the prospective landlord.)

If you’re serious about moving, you need to arrive at the property ready to commit (at least 90% there.) If you like the property at the showing, you should apply on the spot. You’re not signing the lease agreement yet, so you can still back out later. But if you wait to apply after the open house, you may have missed your chance. This may not be the case in small towns, but in big cities where many residents are renters and turnover is high, landlords choose their tenants based on the first satisfactory application submitted. You can improve your chances by having most of the application process completed before you even arrive at the showing, and by completing the rest at the showing.

Most landlords will require an application, which will be available at the showing. Have a pen with you so you can complete the application on the spot. The application will ask for certain information, which you should have ready:

1. Current and past addresses and landlords
1. Print out a list of your addresses and landlord names/phone numbers. If your landlord is a management company, you can state the management company name. If you are a good tenant, talk to your current or previous landlords to give them a heads up to give you a stellar recommendation.
2. Recent credit report
1. Please see my previous post on how to print a free credit report.
2. Check your credit report for accuracy ahead of time, so that you can correct any mistakes prior to the application.
3. Current employer information and proof of income
1. In most places, landlords will check that the monthly rent does not exceed 30% of your income. For example, if your gross (pre-tax) monthly pay is $4000, you can afford to pay $1200 on rent. In bigger cities where rent is more expensive, landlords will relax this rule to 50% or more.
2. Print your last two pay stubs -- this will be proof of your income, and will also list your employer information for the application.
4. Bank statements
1. While optional, this is especially important if your income is too low for the 30%/50% rule above, or if you work for yourself and therefore do not receive a pay stub. Print your last two bank statements to show the prospective landlord that you have enough savings to pay the rent even if you lose your job for a few months.
2. Your most recent tax return (just the first page) can also document your income.
3. If you haven’t started your job yet, bring your signed offer letter stating your salary.
5. Copy of ID/driver’s license -- to confirm your identity.
6. Co-signer, if needed
1. If you do not have substantial income, someone (like a parent) can co-sign the application. S/he will not live in the apartment, but will be responsible for payment if you fail to pay your rent.
2. If you are applying with roommates or a significant other, have the above for each applicant.

You should attach all of this to your application. Of course, make copies of all the documents, and only give a copy (not the original) with the application. Have this “pack” prepared for all the showings you attend. In a small city, you may get the first apartment to which you apply. In a big city, however, expect to apply to several apartments and hope to hear back from at least one.

One more thing that can help when the competition is tough: a bio. Write a little bio about yourself. Include the reasons that you are moving, your excellent reputation as a tenant, why you love the neighborhood or this building, explanation for any reasons you may not seem qualified, etc. If the landlord makes a connection with you, s/he may offer you the apartment over someone with an equally qualified application. You can even include a small picture of yourself. This will help jot the landlord’s memory when reviewing the application to match the friendly face s/he met at the showing with the application.

Some things not to do: don’t obviously bribe the landlord with muffins, gifts, or offers of paying 6 months in advance. A professional management company is not allowed to accept gifts or any payments outside of the standard rent schedule, and a small landlord might get offended.

Leave your apartment winning tips in the comments!

Accessing Your Credit

You should monitor your credit regularly: monthly, every four months, or annually.

Why?

There could be a mistake, and you have a limited amount of time to report/question/correct it.

Say your credit report shows that you paid your Visa bill 15 days late in October. But you paid it on time, and you have the endorsed check to prove it.

Or the credit report shows that you have a Macy’s credit card, but you don’t.

These are mistakes that negatively affect your credit score, and the sooner you correct them, the sooner your score will go up. (Why is it important to have a high score? Check the last post.)

First of all, if you take just one thing away from today’s post, it’s this:

DO NOT GO TO WWW.FREECREDITREPORT.COM

to check your credit score. While this website provides credit monitoring services, etc. it is a PAID subscription that will charge your credit card every month, and unless you need the services it offers, please don’t waste your money. There are FREE places to get this information.

By law, the three credit bureaus are required to give you one free credit report per year. That means that between the three, you can have a free report every 4 months. Here is the website:

www.annualcreditreport.com

From there, you will select which agency you’d like to view: Equifax, Experian, and TransUnion. The website will ask you confidential questions to confirm your identity, such as your social security number, current and past addresses, and date of birth. The important thing is that they will NOT ask for a payment method. (Because they ask for such confidential information, please access this site from a secure location such as your home, not in a public place such as a coffee shop.) You will receive your report right online. Print or pdf it immediately before the website expires, then review and make sure all the information is accurate.

If something is wrong, follow the instructions for contacting that credit bureau (found on the credit report and on the website.) In this case, you should also run the reports for the other two agencies to make sure they do not have the same mistake.

Follow this process again in 4 months, or in a year.

Note: you will not get a free credit SCORE with this -- that will cost extra. However, there’s an easy way to get your credit score for free.

www.creditkarma.com

(Note: each credit bureau has a different method of calculating the score, and a different scale. They are not comparable to one another, but you can track the ups and downs of your score by mapping the score from one agency over time.

In this website, you will create an account, enter personal information to confirm your identity, and get your credit score. You can go in and run your score once a month. This website is supported by ads, and has financial offers that may help you save money. For example, Credit Karma will see that you have a mortgage at a 6.5% rate, and you have an excellent credit score which qualifies you for a much lower rate. It will give you mortgage offers from several lenders to reduce your rate. Of course you do not have to accept these offers, but 1. know that this is advertising, and 2. realize that you may be able to reduce your financial expenses, so look into it (not just from these offers, but on your own, too.)

Credit Karma has a nifty graph which shows the progress of your credit score. If you closed a credit card in January and that lowered your score, you can see exactly by how much. Investigate any significant jumps in your score.

Another reason to keep these websites in mind: when you’re looking for a rental. More often than not, landlords will run a credit check on a prospective tenant. You should make sure your credit history is accurate before your prospective landlord discovers something (that you know is wrong) that will deny you the apartment. The best applicants bring a recent copy of their credit report to the open house. Now you know where to get one for free.

PS. I run my free credit report once a year, and check my Credit Karma score once a month.