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I am in a bad situation now and considering a chapter 7. I want to know if that makes it harder to rent in the near future or will it help since I'll be able to start building my score up again? Thanks.
Our policy is no BK within the past 5 years, with everything current since then and good debt ratio, with 2.5 x's the rent in gross income. Good rental hx helps a lot. Others' mileage may vary.
It will definitely make it harder to rent, yes. You might want to try to rent a place before you file and then just stay there building rental history as the bankruptcy ages.
I speak from direct experience...of course it depends on the apartment complex.
Chapter 7 will make it harder to rent. Not impossible, but a lot harder. The majority will likely reject your application until at least 3 or more years has passed since the BK, and as KonaKat said, good history since then.
Chapter 13 though, in my experience, is a little more acceptable, provided you can show evidence of solid payment history through the plan AND good history since filing. This is assuming the apartment management company does manual reviews of applications instead of automated decisioning. They'll likely ask for a significantly higher deposit, but most won't reject you outright, especially if they're hurting for tenants.
I would suggest, if your situation is so bad that a Chapter 13 is out of the question (basically, you know you will be unable to pay anything at all towards your debts...even a fraction of your current payment amounts), and you decide to go Chapter 7 instead, you're going to have an extremely tough time filing. tilli's suggestion is sound, assuming you have maintained good payment history on your existing debts and have the income to back up the rent. If stuff is in the 30/60 days or you have numerous collections or little-to-no-income, same problem.
You are screwed. It depends on where you live, for example, Vegas, any place rents to people with a bankruptcy, you just have to pay a higher deposit. Florida, forget about it. Apartments won't let you in, for anything. Except places you would not want to live. So, you have to rent a condo from a private owner, and you are at their mercy, you have to pay a higher deposit, and then, when you leave they expect the place to be pristine. I spent days scrubbing the last place I left, and the "princess" I rented from still thought the place looked "grubby" and with held my deposit. I did not realize that a bankruptcy would make it so I would not have a place to live. I took my ex's debt when we divorced to get rid of him, thought it would be worth it. Not.
I am in a bad situation now and considering a chapter 7. I want to know if that makes it harder to rent in the near future or will it help since I'll be able to start building my score up again? Thanks.
I don't rent to anyone with a bankruptcy on their credit report. Sure, sometimes it isn't the person's fault that they had a bankruptcy (for instance, a very large unexpected medical bill) but I can't afford to take a risk on someone with a dodgy financial record.
This is idiotic. You can get an FHA loan 4 years after BK (used to be 2 years), but some of you people won't rent to someone who filed for bankruptcy 5 years or 9 years ago?
I filed Chaper 7 less than 2 years ago and just signed a lease last month.
My credit score is 640 (I don't remember what their minimum was), which is a lot better than the 450 it used to be.
A recent bankruptcy isn't entirely a bad thing, because it means that the person cannot file again (no less than 7 years), which means if the person doesn't pay the rent or causes damages, you can sue and your judgement won't get tossed in bankruptcy court.
This is idiotic. You can get an FHA loan 4 years after BK (used to be 2 years), but some of you people won't rent to someone who filed for bankruptcy 5 years or 9 years ago?
I filed Chaper 7 less than 2 years ago and just signed a lease last month.
Well, bully for you. I'm a bit more careful with my money and my investments than you are, so I wouldn't rent to you.
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A recent bankruptcy isn't entirely a bad thing, because it means that the person cannot file again (no less than 7 years), which means if the person doesn't pay the rent or causes damages, you can sue and your judgement won't get tossed in bankruptcy court.
Sure someone could sue. It's collecting from you deadbeats that's difficult. A judgement doesn't mean that your debtor gets handed a check in court. And yes, a bankruptcy IS A BAD THING. In most cases it means you were so irresponsible with your personal finances that you couldn't (or wouldn't) pay anyone you owed.
Last edited by Ultrarunner; 10-04-2009 at 10:03 AM..
Well, bully for you. I'm a bit more careful with my money and my investments than you are, so I wouldn't rent to you.
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Sure someone could sue. It's collecting from you deadbeats that's difficult. A judgement doesn't mean that your debtor gets handed a check in court. And yes, a bankruptcy IS A BAD THING. In most cases it means you were so irresponsible with your personal finances that you couldn't (or wouldn't) pay anyone you owed.
For your information, I used to have an excellent credit score, never late, until my wife filed for divorce and won such a gigantic amount of money I had no choice but to live on credit.
So, would you rent to me (with a job making 6x the rent) or would you rent to my ex-wife who has no job and has a credit score of 350 but did not file for bankruptcy? She abused the credit system, maxing out every credit card she could get her hands on (she must have some kind of drug problem).
Never mind, I don't need you to rent to me because I already have a place to live. They like getting 1/6th of my income in rent, on time, every time, no noise, etc. Your loss.
Last edited by Ultrarunner; 10-04-2009 at 10:06 AM..
So, would you rent to me (with a job making 6x the rent) or would you rent to my ex-wife who has no job and has a credit score of 350 but did not file for bankruptcy? She abused the credit system, maxing out every credit card she could get her hands on (she must have some kind of drug problem).
Never mind, I don't need you to rent to me because I already have a place to live. They like getting 1/6th of my income in rent, on time, every time, no noise, etc. Your loss.
Nope, I wouldn't rent to either of you. There are plenty of good tenants out there with good credit ratings and no bankruptcy. My loss? Not at all. I'd rather my property sits empty for a couple months while I look for a reputable tenant, than to take the risk of renting to someone who filed for bankruptcy.
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