You’re in the market for a new apartment. You’ve found the perfect place, submitted an application, waited patiently to hear back from the property and then found out your rental application was denied. Now what?
There are a variety of reasons rental applications get denied. Here are some reasons rental applications get denied — whether valid and invalid — and steps you can take to improve your odds of being accepted.
How am I legally protected as a renter from discrimination?
While there are valid reasons to deny a tenant’s rental application, property owners must abide by federal law, avoid discrimination and hold everyone accountable to the same standards when denying or accepting an application.
Before we discuss valid reasons to deny a rental application, let’s quickly review invalid (and illegal) reasons. Under the Fair Housing Act, landlords cannot reject applications based on an applicant’s:
- National origin
- Familial status
While applicants are protected from discrimination under this law, there are other reasons you may be denied housing.
Valid reasons to deny a rental application
Your rental application has been denied and you’re curious why. These are the most common roadblocks renters face when trying to rent an apartment and some very common reasons applications are denied by landlords:
1. Inadequate income
Landlords want to rent to people who are a safe bet — meaning they’ll pay their rent on time, keep the apartment clean and in good shape and be easy to work with. If a landlord is reviewing a rental application and notices that the applicant does not make enough money to reasonably pay for the apartment at hand, they may deny the application.
As a general rule of thumb, rent should account for 30 percent of one’s income. If someone makes $50,000 a year, they should budget $15,000 a year for rent or roughly $1,250 a month. In this case, if you’re applying for a place where the rent is $2,000 a month, a landlord may feel like your income is inadequate and deny your rental application.
2. Lack of or poor credit history
Your credit score can make or break you, especially when it comes to renting an apartment. Because your credit score is a tangible way for landlords to assess your financial history, if you have no credit history or a poor score, you may be rejected.
A fair credit score is 620, but if you’re trying to rent in a top-tier market, you’re going to need a 740 or higher. If your credit score is below this range, there’s a good chance your application may be denied. Also, if you have a bankruptcy in your financial history, that may negatively impact your ability to rent, too.
3. Rental history and evictions
From evictions to run-ins with past property managers, your rental past may impact your rental future. Prospective renters must consider their rental history when submitting a new rental application. Landlords use rental history to gauge whether a tenant will be a good fit in the apartment complex, and if a previous landlord speaks negatively about you, you may be facing a denied rental application.
If you do have an eviction on your rental history, you may want to discuss it upfront and explain your side of the situation on the application.
4. Insufficient references
When applying for an apartment, you’ll likely be asked to list references — people who can speak favorably about you as a future renter. If your rental application either lacks references or the references themselves aren’t impressive, a landlord may reject you. Make sure to choose your reference wisely.
5. Suspicious background check
Background checks give landlords a look into your past and allow them to make decisions about whether to rent to you or not. If you refuse a background check, this could be a red flag to landlords and they may deny your rental application.
Likewise, if a felony or other past conviction or something else suspicious shows up on your background check, you may be denied, too.
6. Incomplete information
When it comes to submitting a rental application, following the rules step-by-step is exactly what you need to do to qualify for an apartment. If you leave part of your application blank, forget to include pertinent information or simply fail to complete the form in full, you may be denied. And this is a valid reason to deny rental applications. Make sure you dot your “i’s” and cross your “t’s” when filling out a rental application.
7. Lots of applicants
Supply and demand means when a lot of people want something, it increases in value. The same concept applies to the rental market. When a lot of people are vying for one apartment, the demand is high and the supply is low. Your rental application may be denied if you’re competing with multiple people for the same space.
How often do rental applications get denied?
Having a rental application denied isn’t uncommon, but it’s frustrating when it happens to you. You may have incompletely filled out the form, have poor credit or been among 10 people applying for the same apartment, in which case, nine out of 10 applicants were denied. Whatever the reason, knowing how often this may happen can be helpful in understanding why your rental application was denied.
My rental application was denied. Now what?
Here are some things you can do to better prepare for future applications and improve your rental resume:
Review what could have gone wrong
Once you understand all of the reasons your application could have been denied, you can reassess it and determine why. This will give you information about what to improve for next time.
Ask the landlord for feedback on the application
If you’re confused about why you were rejected, you may want to ask the landlord for feedback on your application. While they aren’t obligated to let you know, it doesn’t hurt to ask.
Review your credit score
Chances are you had to undergo a credit check when you submitted your rental application. If you’ve been rejected, now is a good time to read the credit statement and see where you can improve your score.
Find a co-signer
If you were denied because of inadequate income, lack of rental history or a poor credit score, you may consider finding a co-signer for the future to improve your odds of being accepted.
Avoid your rental application being denied
Ideally, you’d apply for an apartment and qualify right away. However, things don’t always work out that smoothly. If you understand all the valid reasons why your rental application was denied, you can make sure your application is solid beforehand and save time and money on a rejected application.
The information contained in this article is for educational purposes only and does not, and is not intended to, constitute legal or financial advice. Readers are encouraged to seek professional financial or legal advice as they may deem it necessary.