Q: I'm wondering how to handle the current situation I'm in regarding renting a new apartment. Here's a background on my situation. I started working right out of highschool (I didn't go to college), so I didn't get the deluge of credit-card offers that most college students get at that point in their life. So for the next 10 years or so, I lived without any credit cards, which wasn't a big a deal at the time since I rented places from people I knew, so they never ran credit checks on me. Finally in 2001, I applied for a secured creditcard from Capital One, and quickly thereafter I was offered an unsecured Capital One Platinum Visa with a limit 10x more than my secured card's limit. I paid off these cards on a timely basis for about a year, and started getting lots of other creditcard offers, ostensibly because they considered me a "good" potential customer. Then at the beginning of 2002, the company I was working for fell on hard times and had to let most of it's workers go. Out of neccessity, a colleague and myself then started our own company (a graphic design firm). I ended up "living off of" my credit cards during this time, hoping to God that our clientele would eventually grow and get the cash flow going again. To cut to the chase, cash flow was always playing catch-up with our company debts, which made it incredibly difficult to make my card payments...ultimately my credit rating suffered, which was an incredibly depressing situation, especially considering how much hard work I was doing to get the company off the ground. The situation becoming too dire for me to handle, I resigned from the company in February, and attempted to make a living as a freelancer. After many months of eating Top Ramen, I finally (about 4 months ago) got a job at a well established company that is in no danger of going out of business soon (basically they're the top graphic design firm in this town). I also have another side client which gives me another steady monthly source of income. So I'm now in a position to be able to pay off my past debts (including 2 of the credit card accounts which have been closed by the company due to my payment delinquencies), and have been taking big whacks out of the outstanding balances on these accounts (paying over 200-300% more than the minimum required monthly payments). Problem is, of course, that my credit report now says that I have a "poor" credit rating, even though my account history (im using consumerinfo.com) says that for the past 4 months, my payment history has been "OK" for all my accounts. Now, I am in a position where I have to move out of the place I've been renting for the past 5 1/2 years by the middle of January (my housemates are moving, and I really would like my own place, being that im completely sick of having roommates), and now I'm freaking out about these apartment application forms where they ask for my credit card account numbers so they can look up the credit. I have fully paid off one of my credit cards recently. Do you think it's a good idea to supply that card number on the application, even though my credit report shows that up until 4 months ago, that card had horribly deliquent payments on it? Should I append a "letter of explanation" when I submit my application, explaining basically what I explained in this post? Maybe offering to pay a larger deposit? I am really freaking out about this, and any advice anybody can give me woul dbe most appreciated.
A: I say "Credit report, schmedit report!". Sure, we run them on our applicants (applicant pays for it) -- but in the last 5 years I've run dozens of reports a year and haven't seen a "good" one yet. The fact is, housing money is cheap. Anybody can get a mortage loan these days. The only people who don't are those with ReallyCrappyCredit(tm). In our area, the only folks who rent are those who have bad credit. All the "good credit" folks are buying their own places. If landlords, management companies etc. turned people down simply because of bad credit, they'd have no one to rent to. I can't turn someone down for one of my units for a bad credit report. If I did that, all of my units would be vacant. In the rental business -- crappy credit reports have become a way of life. I've given up even hoping on ever seeing a "good" credit report on an application. The way I figure it: Folks will be late on their credit card payments (so what), but when they're late on the rent, they're out on the street in 30 days (may vary according to where you live). I'll accept crappy credit reports because the possibility of living on the streets is a huge motivator in making the rent payment on time. Bottom line: Don't sweat it. You'll find someplace to rent to you no matter how bad your credit is.