7 Things to Know About Renting an Apartment or House After Bankruptcy
Many clients ask me about renting an apartment or house after giving up their house in bankruptcy. First, you usually don’t have to give up your existing house or apartment, but it might be choice you’d make.
This can be because your trying to hang onto a house you can no longer afford. These days, it’s not so easy to downsize simply by selling and buying. It can be hard to find a buyer, especially if your house in “under-water” (you owe more on it than what it’s worth).
Or, it may be pointless to keep it if it’s not where you intend to live forever. You may never to be able to sell and break-even.
Or, you may run into a very costly home maintenance cost. If you need a new roof, well, septic tank or other large expense, you may not have the extra cash to do it.
Bankruptcy can relieve you of the debt. You can give back the house and say “that’s the end of it.” Then, the mortgage company can’t sue you for the difference. It will likely say it couldn’t re-sell it for enough money. It may also cause a tax problem through “forgiveness of debt” income.
In any event, renting shouldn’t be hard afterwards. And… ah, finally, no more worrying about taxes, insurance, minor upkeep, or major repair bills. Below I’ve listed 7 ways to make it very easy to rent.
#1 Be Prepared With Referrals
You can overcome many issues by using referrals. A note from your mom won’t suffice, but a reference from your employer, a friend, or someone stating your reliability can help sway a landlord to rent to you.
#2 Save Up A Larger Security Deposit
You might need a slightly larger deposit, but you may not. If you are able to offer a larger deposit, it can go a long way!
#3 Have Proof Of Income Ready
Landlords mostly just want to see that you will be able to pay your rent on time every month. The security deposit and references help. Proving you earn enough to pay the rent is also important. Pay-Stubs can help and so can a confirmation from your employer that the information on the stubs is correct.
#4 Renting From A Private Landlord
Larger corporations will have more inflexible policies. Smaller firms or individuals will often show more leeway, and work with you.
#5 Find A Co-signer
Finding a co-signer with decent credit helps immensely. If so, it never hurts to ask if the cosigner can be released from the contract after renting for a year or so. This will make your co-signer more comfortable, and is a common practice. A parent, family member, or close friend may agree to help.
#6 Renting Near A College
Landlords near colleges specialize in young and inexperienced renters. Having re-established credit and eliminating existing debt is a major plus for them.
#7 Tell The Truth
There’s no downside to making a case for yourself. Explain why you went through bankruptcy – often it’s a life event over which you had no control. These include divorce, illness, job loss, or injury. Then tell the landlord why you will now be a good risk as a tenant. It never hurts to ask, and honesty is the best way to go.
Be sure to visit my website for more articles and information, or to contact me for yourself or someone you might want to refer to me.
For over 30 years, listening to clients and putting them at ease, while meeting their needs and helping achieve future goals, in Marion County (Ocala, Belleview, Dunnellon…); Lake County (Leesburg, Tavares, Mt. Dora, Lady Lake, Clermont, Fruitland Park…); Citrus County (Crystal River, Inverness, Homosassa, Hernando…); Sumter County (Bushnell, Wildwood, Webster, Lake Panasoffkee…); the Orlando area, and The Villages.