by Dan Krell © 2009
Renting is not just for those who are unprepared to own a home. These days, many individuals and families are finding that they are seeking rentals because they are being evicted by their foreclosing lenders.
Some have called the influx of renters a crisis in the making, but the extent of the crisis is not yet clear. Many seeking a rental are finding that it is not as easy as they thought; they are finding that applying for a rental is much like applying for a mortgage.
If you plan to apply for a rental (home or apartment) be prepared to provide your personal information to the landlord/management company. Much like mortgage underwriters, landlords and management companies want to make sure you have the ability to pay the monthly rent and through the term of the lease. In addition to collecting your income and employment information, they may also require references from employers and/or previous rentals. Additionally, they will check your credit report to see if you have a history of paying your bills on time.
Before applying for your rental, be prepared by having a month’s worth of pay stubs as proof of your income (self employed individuals may need to provide other forms of income verification) as well as communicating with your employer that they may be called upon to verify your income and employment history. If you’re unaware of your credit standing, be prepared by ordering a free copy of your credit report in case you may need to explain any reported derogatory information.
Additionally, along with your application you should have your first month’s rent and security deposit available. The security deposit is provided as a safeguard against damages to the home and can be equivalent to the first month’s rent or more depending on the terms of the lease and/or additional circumstances (such as pets).
Although the recent decline in home sales has made the rental market competitive, there are rentals available – but you may have to act quickly. If you waiver in your decision or just not prepared, you may lose your rental. For a wealth of information on renting, you can turn to the Montgomery County Department of Housing and Community Affairs (www.montgomerycountymd.gov/dhctmpl.asp). The DHCA offers online resources for landlords and tenants, including a rental guide and rental listings.
Many who have had recent foreclosure are finding that not all landlords/management companies are open to allowing them to rent due to their credit issues. However, some former home owners are finding that some landlords/management companies are flexible in accepting renters with past credit issues; these “understanding” landlords/management companies may require additional deposits as security.
Although there are many recently evicted home owners who are finding rentals, some are having trouble and are at risk of becoming homeless; after all, they may be financially challenged and may not have enough money for rent and security deposits. If you are or know someone who is at risk of becoming homeless, consider contacting the Montgomery County Coalition for the Homeless (301-217-0314). The Montgomery County Coalition for the Homeless is described as a non-profit and community-based organization, and a leading provider of permanent and transitional housing, emergency shelter and supportive services for people experiencing homelessness.
This column is not intended to provide nor should it be relied upon for legal and financial advice. This article was originally published in the Montgomery County Sentinel the week of October 12, 2009. Copyright © 2009 Dan Krell