Ask Phyllis!

The Importance Of Good Credit

Dear Phyllis,

I enjoy your real estate advice. My question is a bit different; my son and his fiancé have been trying to rent an apartment. They are living with us and, likely, we are more motivated than they for them to move. 

Like most kids my son made some mistakes and his credit isn’t great. He keeps submitting offers for apartments but there are so many other applicants that he and his fiancé can’t get accepted. 

Do you have any advice?   

~ Soon-to-be empty nesters

Dear Empty Nesters,

As a real estate agent, I know the value of a good credit history. As you have learned, even if your children are not on the road to home ownership, they still need favorable credit in order to rent. 

First, your son and his fiancé need to obtain copies of their credit report and adequately explain each and every derogatory credit item. Hopefully these were isolated to a specific period of time. Ideally, this letter should convince a landlord or property manager that he has learned from his past mistakes.

Consider that you are on the other side of this transaction and you were the landlord with a handful of credit worthy applicants to choose from. You likely need to do something to tip the scales in your son’s favor. You and your husband may need to guarantee the lease

or prepay thre to six months up front. 

A note to other parents: Do your kids a favor: as soon as they are 18 help them establish credit.  It’s never too soon to teach them responsibility. My daughters both recently graduated college and are now employed. My oldest daughter deplores credit and was a bit resistant to my suggestion that she obtain a credit card in order to build her credit history. But she wisely followed my advice and both my girls are building their credit. I hope that one day both daughters will become homeowners.

In order to obtain the best possible interest rate they will need a high FICO score (760 or higher).