Can You Lease An Apartment After Declaring Bankruptcy?
by Veeti Lepisto
Almost everyone considering bankruptcy is wary about what might happen afterward to their financial situation. While bankruptcy filings do place a mark on your credit history, repeated late payments, court judgments, foreclosures, and repossessions can be even more damaging. If you expect to move within the next 10 years, it's smart to consider how a chapter 7 bankruptcy filing could affect your ability to sign a lease. Read on to find out more about that issue.
What Property Managers Look for in a Tenant
It may help to understand that property managers and landlords seldom target specific issues like bankruptcy when evaluating potential tenants. Most, however, do like you to wait until your bankruptcy is fully discharged before they will rent to you. That is because there is always a chance that a filer could amend a bankruptcy filing to include back rent payments, and that can be a real headache for that landlord. Once you receive your final discharge paperwork you should be okay to rent, as long as you can show that you are a good credit risk. That means attending to the below issues:
Income Level – One of the most important financial issues is your ability to pay the rent, and that is tied to your income. Many places expect tenants to earn anywhere from two to three times the amount of the monthly rent. That means if the home you want to rent is $2,000 a month, you will need to show that you can bring in at least $4,000 to $6,000 a month to qualify for the home. The higher your income, the less your bankruptcy will matter when it comes to renting.
Credit Rating – A federal filing will bring your credit score down, but it may not affect it enough to matter to the property manager. You can prevent a great deal of damage to your credit score by filing before you have damaging dings from creditors.
Rental History – Showing that you have paid on time in the past may be far more important than the existence of a bankruptcy. If you have evictions, however, you are at an extreme disadvantage. Not all landlords and property managers report evictions and rental records to credit bureaus, but you may have to list your most recent renting information to be verified.
Other Factors – In addition to the above issues, you might want to pay attention to things like the following:
- Length of time since filing bankruptcy
- Debt-to-income ratios
- Length of employment
To find out more, speak to a chapter 7 bankruptcy law professional as soon as possible.
Share
About Me
Several years ago, one of my best friends married the guy of her dreams. This tall, quiet man adored my friend. Almost every week during their courtship, he presented her with a beautiful, fragrant arrangement of flowers. At the time, my friend’s mom joked that her home resembled a funeral home because of all of the flowers her boyfriend sent her. After the happy pair married, they purchased a new home together and quickly began running out of money, meaning that he could no longer afford to give her the flowers she loved. They even discovered they couldn’t afford to pay the monthly mortgage. After only a few years of marriage, they filed for bankruptcy. On this blog, you will discover the ways a reputable bankruptcy attorney can help you successfully recover from financial ruin.