Danielle Hale Chief Economist | realtors.com
Residents in Atlanta are facing challenges in securing affordable housing despite an increase in available options. A key obstacle is low credit scores, which prevent many from signing leases. Jackeine Wilson, a resident of the city, pays $1,200 monthly to live in a hotel but cannot secure a lease due to her poor credit score.
In 2022, Mayor Andre Dickens set a goal to create 20,000 new housing units by 2030, with 60% reserved for households earning $60,000 or less annually. Although 8,000 units have been constructed so far, an investigation by NBC affiliate 11 Alive revealed that low-income earners are often unable to benefit from these units due to their insufficient or nonexistent credit scores.
Investigative reporter Rebecca Lindstrom highlighted that many individuals most in need lack sufficient credit history or have poor credit and are unsure how to improve their scores. Kate Bulger from Money Management International explained that "anything really under 600 is tough" for qualifying for leases or mortgages.
Credit scores play a significant role in renting and borrowing. Standardized since 1989, FICO scores range from 300 to 850 and influence lenders' decisions. While there's no legal requirement for landlords to consider credit scores, most require at least a score of 670.
To improve credit scores, individuals can pay bills on time and apply for secured credit cards. Additionally, being added as an authorized user on another's card can help build credit. For those with existing cards, paying more than the minimum each month and keeping balances low is recommended.
Renters with poor credit should be aware of their score and seek private landlords who might not require checks. Providing extra documentation like recommendation letters or proof of salary may also help overcome poor credit histories.
Alerts Sign-up