Would you rent to a tenant with 600 credit score? (renter, landlords, loan)
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I don't have a credit history. I don't have credit cards. I have no debts and write out checks to pay for everything (including my house). I do have debit cards to pay for other things.
And ?
Not a great way to do things but nothing is ever a problem until Its a problem
You don't have to establish credit to show a derogatory account on a report. Unpaid medical bills or utilities that are sent to collections will show on a report, though the debtor hasn't established credit in the traditional way.
This doesn't give a full picture of someone's willingness/ability to pay bills but it's useful in weeding out the biggest offenders a LL would see in screening a tenant.
Unfortunately, being a LL often takes some work that doesn't fit into a box. Good LL's can get past the surface stuff and make good business decisions based on experience. Having rigid requirements with zero wiggle-room is IMO being hard-headed and is detrimental to good operation.
If you're in a dream market and have an abundance of perfect applicants I guess being a LL is easy enough for anyone to do. If you're operating in the real world with real and therefore imperfect people and want to actually get a tenant placed so the property can flow some cash, you might have to work a little.
You don't have to establish credit to show a derogatory account on a report. Unpaid medical bills or utilities that are sent to collections will show on a report, though the debtor hasn't established credit in the traditional way.
This doesn't give a full picture of someone's willingness/ability to pay bills but it's useful in weeding out the biggest offenders a LL would see in screening a tenant.
It depends , when it comes to medical debt or utilities not all report to all three agencies...we had a case of ID theft and someone opened up a utility account in my wife’s name .
Looking at two out of the three agencies showed nothing ...good thing we ran all three as we found it on the last one .
Unless you are going to check all three which is rarely done for a tenant as most places that do the checks are members of only one , you may never see that unpaid bill.
Those companies who are able to run back ground and credit checks have to be members of the agency which isn’t cheap so they usually pick one to use .
And if the new home owner trashes his new house, it is his house that he is trashing and not mine. If he doesn't make the mortgage payments, it is the bank's problem to get him out and not mine.
If the bank wants to let him in, he is the bank's problem. I'm not letting him in to become my problem.
You have to work really hard at it to get a credit score that low. I've seen people with a dozen accounts in collection with better credit scores than that. To have a 580, you have to very consistently not pay any money you owe to anyone. Why would I let someone with a long history of never paying their bills into my expensive house and think I am going to be the one and only account he ever pays on time?
No thanks. But hey, if the banks want to give him a mortgage, he can buy his own house instead of renting.
I'm not arguing that a landlord can't/shouldn't have standards that he will or won't accept. That's fine and up to the landlord, so long as they are not illegal.
But I disagree that its as 'hard' as you think it is to get a 580.
I also disagree that a low credit score is an indicator of whether someone would damage the property. Credit scores are not the singular defining factor of a person's character.
It depends , when it comes to medical debt or utilities not all report to all three agencies...we had a case of ID theft and someone opened up a utility account in my wife’s name .
Looking at two out of the three agencies showed nothing ...good thing we ran all three as we found it on the last one .
Unless you are going to check all three which is rarely done for a tenant as most places that do the checks are members of only one , you may never see that unpaid bill.
Those companies who are able to run back ground and credit checks have to be members of the agency which isn’t cheap so they usually pick one to use .
True. But I have found that if someone has bad credit, hidden or not, it is often accompanied by bad income/job history and some shady court stuff. It's very rare to find a tenant who has great job tenure, zero traffic tickets, and horrible credit.
It's why I think credit is overrated and a better picture is gotten by looking at the three biggies: Credit, Job History & Criminal/Courts.
Not a great way to do things but nothing is ever a problem until Its a problem
And the fact that (even though I am not financially unviable) I have no credit score does bother me. Must I borrow money and pay it back in a timely fashion to get a credit score?
And the fact that (even though I am not financially unviable) I have no credit score does bother me. Must I borrow money and pay it back in a timely fashion to get a credit score?
Get a credit card (secured if you must). Use it to buy gas and groceries, or other everyday expenses. Pay it off in full every month. Instant good credit score.
And the fact that (even though I am not financially unviable) I have no credit score does bother me. Must I borrow money and pay it back in a timely fashion to get a credit score?
Most people have a credit score if any place they deal with reports like utilities, but having a credit score is different from having a high credit score .
You either come back no credit history found or you have a score .
Why dont you check yours and see..Many states allow insurers to factor in your credit score when setting your premiums
Get a credit card (secured if you must). Use it to buy gas and groceries, or other everyday expenses. Pay it off in full every month. Instant good credit score.
Not all secured cards report ..be very careful researching the one you use.
Also the credit scores you get from the credit cards are not comprehensive scores which include all sorts of payments ..it is called a bank card score ...it weights credit card usage ..it is used by very few lenders .....lenders like banks , mortgages and auto loans use more comprehensive scores
Last edited by mathjak107; 02-15-2021 at 02:59 PM..
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