In a bad situation. What credit score needed for renting apartment in Los Angeles and nearby areas?

[SnS351]

Hi Everyone, I plan to relocate to Los Angeles by the end of this month because of a new job offer and currently in search for an apartment over there. My preferred places are Monrovia, Pasadena, Azusa, Duarte, Arcadia, El Monte, and Temple city. I will be getting paid 130K/year and will bring about 7.2K/month after taxes and deductions (single with no dependent). I will have 6.2K available for me to pay-off my debts and living cost because I recently built a house in my home country (not USA) with loan and send $1000/month for that.  

The problem is my credit scores. Due to some stupid mistakes in stock market, I currently have about 55K credit card balance and a personal line of credit with 18K balance. All the credit card debts are currently at 0% APR which will last till Jan-April 2022. Personal line of credit is at 6.9% APR. My minimum payment for all these debts is around $1500/month and I have been paying around $2500/month. These recent debts caused all 3 FICO scores to take a severe hit. They were all around 760-785 ranges back in March-April of this year but now they are hovering around 640-660. My current utilization is around 38-39%. My other credit cards are with 15-20K limits and I just use them to make one or two purchases every 3-4 months and then pay them off because of their non-zero APRs. 

I do not have any negatives on my account. My payment history is 100% paid on time over the last 9 years (the age of my oldest account). I opened a lot of credit cards last year and at the beginning of this year so have lots of inquiries (last one 5 months ago). Also, my average credit age is only 4.5-5 years.  

Personally, I have a frugal/minimalist lifestyle so don't have many expenses. I do send money to my old parents every month to another country (about $200-250/month). I drive a 2005 Toyota Camry and meal prep every week. I probably eat one or twice per month outside at most. The point of all this information is to express my overall situation so that you can give me some advices. Forgot to mention, I got about 80K worth of stock options from the new company vested equally over the next four years which could become 400K after two years or zero depending on how the company performs. 

Anyway, I am concerned about my low FICO scores. My driving and criminal records, rent and utility payment histories are clean. It would be great if you all could give me an idea about the FICO score requirements in LA area.       

[Ontime1010]

Never lived in LA so don't know if there's specific criteria for that area or not. Generally speaking though I think rental companies are checking credit for delinquencies, bk, collection, evictions etc. maybe less of an emphasis on low credit score because of utilization. That's my thought on it. As long as you have cash flow from a job and your DTI isn't crazy I think you should be ok. If not, another option is to room share or rent a place from a mom and pop operation who may be more willing to overlook or in some cases not even check credit if other boxes are being checked.

[Anonymous]

I have read of people being able to be approved sometimes with scores below the threshold by paying a larger deposit at the outset as well. That also might be a possibility.

[Anonymous]

Rental landlords typically use a rental screening credit check which is unique interpretation of a credit file that ultimately predicts eviction risk for prospective tenets. While this screening weighs prior evictions and defaults heavily, it could also use debt obligations in its calculation of the risk score. 

I also don't know much about the rental market in the LA area. I will say the rental market, in general, is a little odd at the moment. With all the COVID eviction mortatorium repercussions that landlords experienced, many seem to be reluctant to take on those "fringe" credit risks that they once did.  And to be honest, based upon your finanacial description, you aren't on the best footing. 

I think you'll eventually be able to find a place to rent, but you may have to search a bit and think outside of the box a bit. 

[SlideOrInsert]

as you have no derogatory marks, the credit number shouldn't be the focus. you say "will be getting paid [salary]" but what can you provide as evidence? will you have any paystubs by then? if not, what previous income can you prove via tax, bank, etc. records? obligitory, "most places look for income 2.5‑3x the rent." a long/stable/healthy income even superseeds a credit number sometimes.

[SnS351]

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@Ontime1010 wrote:

Never lived in LA so don't know if there's specific criteria for that area or not. Generally speaking though I think rental companies are checking credit for delinquencies, bk, collection, evictions etc. maybe less of an emphasis on low credit score because of utilization. That's my thought on it. As long as you have cash flow from a job and your DTI isn't crazy I think you should be ok. If not, another option is to room share or rent a place from a mom and pop operation who may be more willing to overlook or in some cases not even check credit if other boxes are being checked.

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Got my first denial yesterday stating the "credit histor" as the reason. I applied for a room in a two bedroom apartment with rent $950 (my portion). There was an option to receive a copy of the screening report when apartment management pulls it. I got my copy of the report 10 minutes after submitting the rental application. The report looks something like this-

1. Rent payment history: 0 potential negative items
2. Landlord-Tanent history: 0 cases found
3. Criminal/public history: 0 cases found
4. Sexaual offender registry: No
5. Watchlist: No
6. Creidt history: 0 potentially negative items
   Credit Score: 598 (Vantage Score 3) from Experian
   Estimated monthly debt payment: $720
   Total accounts: 39
   Open accounts: 24
7. Eviction risk: 5-9%

I asked the apartment manager (looked like a 17-18 years kid) the specific reason for denial. He said my FICO score was too low and their apartment requires an average of 700. I told him that my Experian FICO is 659 but what he pulled was a Vantage Score which is based on a different scoring model. He said I should talk to the screening company. I asked him about the conditional approval outlined in their application such as more security deposit for people with no credit/bad credit history, higher income requirement. I pointed out that my income is 11.4 times the rent payment and they only requires 2.5 times. But he sounded like he doesn't understand the difference between Vantage and FICO scores. At this point I was sure that there was no point of asking anything to that kid so I decided to make some fun. I offered him 1 year of advanced rent and 5 times the security deposit. He sounded confused and then I explained that the lease term is for one year and if I pay the whole year rent upfront he litrally do not have any risk. But he said No 🤣   

[SnS351]

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@SlideOrInsert wrote:

as you have no derogatory marks, the credit number shouldn't be the focus. you say "will be getting paid [salary]" but what can you provide as evidence? will you have any paystubs by then? if not, what previous income can you prove via tax, bank, etc. records? obligitory, "most places look for income 2.5‑3x the rent." a long/stable/healthy income even superseeds a credit number sometimes.

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1. Evidence for 130K income is offer letter from the company that the landrod can verify with a quick phone call or email.
2. I will have my 1st paystub in CA mid August
3. I have paystubs from last 8 years from the same company, previous W-2s but those income are from a different state so the salary is way lower than 130K. I can just show my 1099 from last year with additional income of 117K. 
4. My income 6-8x the rent of the apartments I am interested in.  

[SnS351]

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@Anonymous wrote:

And to be honest, based upon your finanacial description, you aren't on the best footing. 
 

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Agreed. But I am not on the worst footing either. If I share a 2 bedroom apartment with someone and pay rent somewhere between 1-1.3K then my living cost will stay below 2K. This way I can pay 4K towards my debt and it will take me less than one and a half year to get out of all the debts. I personally know people with 60-80K student loan debt making 70-80K a year but still driving a brand new car to maintain status (!) 

[SoCalGardener]

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@SnS351 wrote:

Hi Everyone, I plan to relocate to Los Angeles by the end of this month because of a new job offer and currently in search for an apartment over there. My preferred places are Monrovia, Pasadena, Azusa, Duarte, Arcadia, El Monte, and Temple city. 

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You're talking my neck of the woods! Specifically, Arcadia (although I lived in Pasadena as a very young child, then moved to Arcadia). I suggest you scratch El Monte off your list. We (locals in Arcadia) refer to it as a .... well, I can't say what kind, but a [blank] hole.

I can't help you at all with rental information/qualifications/procedures. I've never rented here. Are you aware of the cost of housing in the cities you're considering? Everyone knows that LA housing, in general, is expensive, but it's even worse in certain cities--like Arcadia. The median selling price in my neighborhood is around $2.5 million. That's for a single-family house. I do know that houses in my neighborhood rent for $3,500-$7,000/month.

The more northern part of Temple City is pretty good; Monrovia has some beautiful areas; Azusa is RIGHT at the cusp of my favorite mountain area and is generally quite nice, and lower-priced than Arcadia or Pasadena.

If you do indeed move here, you might want to sign up on NextDoor ASAP. It's a very friendly place and a great way to ask for recommendations from locals for everything from the best vegan Ethiopian restaurant to the best veterinarian for zebras!

If you have any questions about specific neighborhoods/areas that I might be able to comment on, please ask.

[Dirge]

It seems like credit scores are more of an immediate problem for you than ready cash/credit. Have you considered staying at an extended-stay hotel for a few weeks? That would also give you a chance to scope out neighborhoods for your permanent move. 

Good luck!