Rental questions with credit check

[Daniel Byrd]

So me, my girlfriend, and 3 other people want to rent a house together in California. Most of these house say they require a credit check for all applicants. My girlfriend and I are the only ones with good credit, while everyone else has none. Would they check their credit too? If so, would they be denied to live with us? Would it even be possible to rent a house? Or does just one person need good credit? Help would be appreciated.

[Rob B.]

Hi Daniel. I know moving can be super stressful but it certainly sounds like you're starting to ask the right questions. Landlords have different screening processes, so your landlord (or the property management company that they're using) might have specified a set of requirements that you'll all need to meet. Generally, you can anticipate that anyone over the age of 18 who intends to reside on the property will need to complete the full screening and will be required to be on the lease. Having said that, a rental owner might be reluctant to sign a lease with a tenant if they don't feel as though that tenant will be able to honor that lease (ie. pay rent on time, and honor the rules established within the lease).

If you have a roommate who has little to no credit, the landlord will probably require a co-signer to vouch for them; i.e. have a parent who has a monthly income 3x that of this roommate's share of the rent. A big reason for this is to mitigate some of the risks of taking on a tenant who might not be able to make rent, and there's no credit history to go off of so no way for them to know.

Now, if the tenant doesn't have the greatest credit score (or even a super low credit score), more often than not that will have an impact on the overall application (not saying it is right, but it is about mitigating risks; if you have someone who doesn't have the greatest history of on-time payments, or, makes habitually late payments, has accounts in collections, etc., then these become clear indicators that this individual tenant may not be the most responsible. The landlord may decide to sign a lease with the other candidates but may indicate that the other candidate is a no go. Again, all comes down to communicating early and often with the landlord. It is possible they'll be willing to negotiate if the other applicants are super stellar. I hope this information helps! @Daniel Byrd

[Jennifer T.]

I run a full background check, including credit, on all people 18 and over who will be living in one of my properties.  To me, there is a big difference between bad credit and no credit.  As long as the combined income was extra solid, I wouldn't be very concerned about some of the people having no credit.  But bad credit?  As in people who have been irresponsible and chosen not to pay bills, that would be concerning even if some of the people had good credit scores.  Funny enough, people who have no credit history, often have a really high credit score.

However, your question is hard for anyone to answer because this is an area of tenant screening where I think there will be a wide range of landlord opinions.

The best I would suggest to you all is to be honest upfront about everyone's credit situation.  That way, if the property owner already knows it will be a dealbreaker, they can hopefully tell you all that before application fees are paid.
 

[Mike McCarthy]

@Daniel Byrd I think the most important thing is to be honest and upfront. There might be some property managers out there that might decline your application due to no credit, but many/most will be willing to work with you as long as the credit/background check isn’t negative.

Also have everyone pull their own credit report via freecreditreport.com to prove there really isn’t any credit.

Also, if you’re in school or just out of school, that’s more common than someone older with no credit. Again, just be honest :)

[John Teachout]

The problem with unmarried people living together in a unit is that it is very easy for people to move out due to whatever reasons and if not "everyone" on the lease is able to afford the rent, this creates an issue for the whole "group". ie, if there's 3 girls living together in a property and it requires all their incomes to fund the rent, if any one of the 3 moves out, then it leaves the other two with rent they can't afford. That's why landlords often require everyone on the lease to qualify for the requirements. If the 3 girls all made 3 times the rent (or whatever the landlord requires) then theoretically any one of them could afford the rent on their own and there would be much less risk of a broken lease or unpaid rent.