Residents in This Southern City Are Being Turned Away for Affordable Housing Because of a Key Number

Despite seeing an increase in affordable housing options in Atlanta, residents are still finding themselves locked out of the housing market.

Atlanta resident Jackeine Wilson pays $1,200 a month to live in a hotel, about the equivalent of the cost of monthly rent in the city. Though she can afford the amount, Wilson has been unable to sign a lease because of her poor credit score.

In 2022, Atlanta Mayor Andre Dickens set a goal to create 20,000 new housing units by 2030, 60% of which would be set aside for households making $60,000 or less annually. The city has already constructed 8,000 new units, but an investigation from local NBC affiliate 11 Alive found that low-income earners are prevented from taking advantage of newly created housing because of their low or nonexistent credit scores.

Many of those most in need in the city don’t have enough credit history, or have bad credit, and aren’t sure of the steps to take to improve their credit scores, investigative reporter Rebecca Lindstrom found.

“I would say anything really under 600 is tough. It’s tough to qualify for things,” Kate Bulger with Money Management International told Lindstrom. “When you are applying for a lease or you’re applying for a mortgage, that credit score is a big piece of the deciding factor for most lenders and most landlords for whether or not you’re able to qualify.”

Credit scores create a barrier to renting

It’s hard to believe, but credit scores as we know them today are a relatively new construct. FICO credit scores only became standardized in 1989.

Credit scores are required for all types of loans—mortgage, car, or business. Credit is gauged on a scale from 300 to 850 and can be affected by the amount of debt you carry and the ratio of debt to credit you hold. Your history of paying bills and credit cards responsibly and on time also counts.

There’s no legal requirement that landlords look at credit scores, but most landlords do typically require a credit score of at least 670—in the “good” range to rent.

There are some things you can do to improve your credit—the most important being paying your bills on time and in full. Failing to do so can be a big ding on your score.

You can also apply for a secured credit card—a credit card that is backed by a cash deposit—and use it responsibly, paying it off each month on time. If that’s not an option, you could also ask to be an “authorized user” on a family member’s card.

If you already have a credit card, you can build credit by paying more than the minimum amount each month and keeping your balance low. Credit scorers typically recommend using less than 30% of your credit limit.

You can also ask some credit-reporting services to have your utility and rent bill payments added to your credit history, to establish additional credit.

What renters with poor credit can do

The most important thing you can do is know your score, so you can plan what steps need to be taken to be improved.

It typically takes between three and six months to establish credit. In the meantime, there are things you can do if your score is low or you don’t have credit.

Some private landlords that don’t operate through management companies don’t require credit checks, so searching for apartments that are rented directly from owners could be an option.

Other landlords are willing to overlook poor credit if you provide extra documentation, such as letters of recommendation from previous landlords and proof of salary.

You can also offer to put down additional funds toward a security deposit, or have a co-signer who is on the hook for any missed rent payments.