Author Topic: Apartment (and other) credit checks on couples?  (Read 7157 times)

galliver

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Apartment (and other) credit checks on couples?
« on: April 26, 2014, 04:23:20 PM »
Can someone tell me how it works in terms of credit/income checks if two (non-family, so far) people rent an apartment together? I have "excellent" credit but low income, my bf has "fair" and earns above the median now, we might be moving in together in a few months in a high-rent area (it was a downside to the choice of moving, but the pros will likely outweigh it, some information is still forthcoming).

I am also wondering how this would work for financing a car...NO that is not the first choice and we are considering all other options first, but if we don't find a suitable alternative (reliable and within our cash budget), I'd like to know how it works--so don't tell me how bad an idea it is, I read this site/forum enough that I know. :)

FWIW we've been together 2.5 years (and I've known him for >7), I don't need relationship advice, I trust him entirely, his credit was damaged by a period of underemployment several years ago, but has been recovering since he's found a steady job (and started seeing me ;) )

Thegoblinchief

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Re: Apartment (and other) credit checks on couples?
« Reply #1 on: April 26, 2014, 07:45:19 PM »
For the apartment, most landlords will require a dual application no matter what since you will both be living there.

For the car, I'd shop the loan, but you would probably get better terms keeping it in one name, likely yours with the higher score.

galliver

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Re: Apartment (and other) credit checks on couples?
« Reply #2 on: April 27, 2014, 05:39:27 AM »
For the apartment, most landlords will require a dual application no matter what since you will both be living there.

For the car, I'd shop the loan, but you would probably get better terms keeping it in one name, likely yours with the higher score.

Thanks very helpful! :)

onehappypanda

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Re: Apartment (and other) credit checks on couples?
« Reply #3 on: April 27, 2014, 06:38:06 AM »
Re: the apartment, different landlords have different approaches. When the boyfriend and I were looking, most around here wanted either a dual application or two separate applications - essentially, the same as if you were renting with a roommate and both of you were going on the lease. Some made it clear that they required one person to meet the income/credit requirement by themselves, I guess to make sure the lease was covered in the event that we broke up. I'd take it on a case-by-case basis, it may depend on your area and the type of landlord you're working with.

This is not relationship advice, so much as general financial advice: I'd avoid sharing a car loan with anyone, or at least have a very clear Plan B if things don't work out. Car debt is a hassle to settle if the relationship goes south, even if both partners are trustworthy. Could one of you afford to take on the financing alone? Regardless of the relationship length/trust/etc., I think it's good financial policy to have a plan in place that you've both agreed to.

As far as getting the loan, if you choose to do so, you could head to a bank and have them run it a few ways: you alone, him alone, and together. When I (briefly) sold cars, most unmarried couples who came in had the person with the highest credit put the car and loan in their name alone. But since it sounds like there might be a large income differential, I think it's worth actually sitting down with someone and running the numbers if you choose to go that route. Also, some financers had requirements that the "primary driver" had to be on the loan - I don't know how common that is, but that's something to keep in mind if one of you will be driving it a lot more than the other.

galliver

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Re: Apartment (and other) credit checks on couples?
« Reply #4 on: April 27, 2014, 07:27:45 AM »
Re: the apartment, different landlords have different approaches. When the boyfriend and I were looking, most around here wanted either a dual application or two separate applications - essentially, the same as if you were renting with a roommate and both of you were going on the lease. Some made it clear that they required one person to meet the income/credit requirement by themselves, I guess to make sure the lease was covered in the event that we broke up. I'd take it on a case-by-case basis, it may depend on your area and the type of landlord you're working with.

This is not relationship advice, so much as general financial advice: I'd avoid sharing a car loan with anyone, or at least have a very clear Plan B if things don't work out. Car debt is a hassle to settle if the relationship goes south, even if both partners are trustworthy. Could one of you afford to take on the financing alone? Regardless of the relationship length/trust/etc., I think it's good financial policy to have a plan in place that you've both agreed to.

As far as getting the loan, if you choose to do so, you could head to a bank and have them run it a few ways: you alone, him alone, and together. When I (briefly) sold cars, most unmarried couples who came in had the person with the highest credit put the car and loan in their name alone. But since it sounds like there might be a large income differential, I think it's worth actually sitting down with someone and running the numbers if you choose to go that route. Also, some financers had requirements that the "primary driver" had to be on the loan - I don't know how common that is, but that's something to keep in mind if one of you will be driving it a lot more than the other.

Thanks for your insights, they are also very helpful in knowing what to expect. I love the experience-sharing bit of this website! :)

Re: your advice, I totally agree, and like I said it's basically the last-ditch option in terms of vehicle acquisition anyway. A written/signed agreement would be a must if it came to that. I'm really just sourcing information, e.g. I didn't know if it was acceptable to have the different parties' financials run separately and together, or if we had to come in knowing how we wanted it done... Btw the ideal option (IMO) is if we can borrow one of my parents' three (!) cars since they live kind of close to the target area, to give us a few extra months to save up and shop around for an acceptable deal (in cash), not right on top of moving hassles. Unfortunately, public transit is quite poor around there.

Can't Wait

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Re: Apartment (and other) credit checks on couples?
« Reply #5 on: April 27, 2014, 08:13:40 AM »
Can someone tell me how it works in terms of credit/income checks if two (non-family, so far) people rent an apartment together? I have "excellent" credit but low income, my bf has "fair" and earns above the median now, we might be moving in together in a few months in a high-rent area (it was a downside to the choice of moving, but the pros will likely outweigh it, some information is still forthcoming).

I am also wondering how this would work for financing a car...NO that is not the first choice and we are considering all other options first, but if we don't find a suitable alternative (reliable and within our cash budget), I'd like to know how it works--so don't tell me how bad an idea it is, I read this site/forum enough that I know. :)

FWIW we've been together 2.5 years (and I've known him for >7), I don't need relationship advice, I trust him entirely, his credit was damaged by a period of underemployment several years ago, but has been recovering since he's found a steady job (and started seeing me ;) )

I live in the DC area which is a pretty expensive place to live. All of the apartment complexes that I've lived in or checked out required an income check and credit check. To meet the income requirement, your monthly gross income has to be 3 times the monthly rent. Having poor credit isn't much of a concern but it could mean you have to pay more of a security deposit. I'm sure both of your incomes combined will meet the income requirement (if any) but you can expect to pay more than the typical security deposit based on your boyfriends poor credit.
« Last Edit: April 27, 2014, 08:16:00 AM by GovtWorker »

Daleth

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Re: Apartment (and other) credit checks on couples?
« Reply #6 on: April 27, 2014, 09:28:25 AM »
You don't want the other person to be on the loan if their credit is middling/fair. AFAIK any lender you ask--whether for a mortgage, car or what have you--will set the interest rate based on the LOWEST credit score. So putting him on the car loan will make the car more expensive.

As a landlord, I run credit checks on all tenants. If one person has good credit and enough income to afford the apartment, I will rent to them. If one person has great credit but it requires both of their incomes to afford the apartment, I would still rent to them as long as everything else comes back clean (calling references, criminal background check, verifying employment), unless I also had an equally nice-seeming person or people with better credit and income also trying to rent at the same time. In other words you'd be good unless objectively better applicants also wanted the place--but that's always going to be true regardless of your credit/income. And actually, if applicants are TOO good I slightly hesitate to rent to them because I don't want people who will live there for a year, save up and buy a house... I want good tenants who will stay at least 2, preferably 3 years, because it's a hassle and a financial hit to have to get new tenants every year.

Paul der Krake

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Re: Apartment (and other) credit checks on couples?
« Reply #7 on: April 27, 2014, 09:35:11 AM »
Our apartment complex required both of us to be on the lease (not married, living in sin), but only ran the credit check against me. Not sure if it's their policy, or they just got lazy, or my foreign sounding name scared them. Or maybe they were blown away by my credit score and didn't feel like spending another $30 to check hers?

Shrug.

But yeah, don't count on that. They will most likely check both, so better to ask them what their policies are, they will be more lenient towards you if you are upfront with them.

For cars, honestly, I wouldn't worry as long as both of you are employed and stick to a reasonable vehicle. Dealerships have to have low standards, otherwise they wouldn't sell any cars.

 

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