You’ve finally found the perfect apartment. The next step is to get the owner’s approval. For this, you will need good credit, a strong rental history, and an income of around 3 times the monthly rent. Sounds easy? Not always. Meeting the qualifications of a property owner or manager can be difficult, especially for new tenants. If for some reason you are not following the landlord’s guidelines, you will want to consider having a co-signer for the rental agreement.
What is a co-signer for an apartment?
A co-signer is someone who signs a rental agreement with the tenant and in doing so accepts financial responsibility for the apartment if the tenant is unable to pay the rent. This is usually done in order to prove to the landlord that the tenant is reliable and will follow the rent. For the co-signer, this may mean stepping in to make unpaid payments that the tenant is unable to pay, as these can affect the credit scores of the tenant and the co-signer if they are not paid.
When do i need a co-signer?
The screening process to determine your rental eligibility is usually completed with a rental application. On a rental application, you will provide information such as your rental history, reason for moving, length of employment, monthly income, and criminal record if applicable.
When selecting a tenant from the applicants, the landlord looks for a reliable person who will keep the property in good condition and make all payments in full and on time. You may need an apartment co-signer if for some reason your credit, rental history, or employment status calls this into question.
Some factors that may require you to have a co-signer include:
- Bad credit or no credit: Landlords look for tenants with a credit score that proves the applicant is financially responsible. For this you will usually need a credit score above 620, but 700 is ideal for demonstrating your financial reliability. No credit history can also be a deciding factor for homeowners, as this makes it difficult to pinpoint potential risks. This often makes it difficult for young tenants to sign a rental agreement themselves. If you don’t have a credit history – and therefore no credit score – you will most likely need a co-signer.
- Low income or no income: On average, landlords require rental applicants to have a minimum monthly income of around 2.5 times the reported rent. This is to ensure that all payments are paid, even under extenuating circumstances, such as job loss or other events that may prevent your ability to acquire the money needed for rent. For example, if the monthly rent for an apartment is $ 1,200, rental applicants should earn $ 3,000 per month. If you don’t meet this requirement, you’ll want to find an apartment with a lower monthly rent or look for a co-signer.
- A history of eviction or no previous rental experience: If you’ve been evicted from a rental property for whatever reason, this sends a red flag to landlords. Having a co-signer is an easy way to give the landlord the peace of mind that you’ll be dealing with the property and sticking to the rental agreement. Similar to having no credit history, lack of rental experience can also make a landlord reluctant to hire you as a tenant. For this reason, new tenants may also need a co-signer.
Who should I ask to co-sign?
When it comes to finding a co-signer, you’ll want to pick someone who meets all of the tenant qualifications that you can’t meet. If you have less income than requested, you will need a co-signer who earns enough money to cover the minimum. If you don’t have a credit history, you’ll need a co-signer with a score on the high end of the spectrum. This can usually be a relative or close friend as long as they are comfortable and willing to take financial responsibility for the property.
It is important that you and your co-signer know and understand that any breach of the rental agreement would be resented by both parties. Be sure to discuss all potential co-signing outcomes – even those you consider unlikely – to make sure both parties are prepared for whatever might happen.
What if I can’t find a co-signer?
If you are unable to find a reliable co-signer for an apartment, you still have a few options.
Landlords may still be willing to accept you as a tenant if you can provide a legitimate reason for any failure to meet the designated tenant’s requirements. For example, if you were evicted by a previous owner, you will want to explain the reason for the eviction, what you did to remedy the situation, and how you changed your behavior to avoid future evictions. Evidence of this will go a long way here, so any documentation you can provide, even a rental reference, can help you make your case.
Money can also be a viable way to show that you are good at your word. Offering a larger security deposit or higher rent up front could help convince a landlord that you’re worth the risk. Going for a cheaper unit can also help, and it shows how invested you are.
If the worst comes to the worst, finding another housing option will give you time to talk with other potential co-signers, increase your credit, or increase your available funds. You might also find that properties owned and managed by local businesses or an individual owner have less stringent tenant requirements. This could help you find a willing co-signer or apply without one.
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