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Does an Apartment Credit Check Hurt Your Credit Score?

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If you’re searching for an apartment to rent in Canada, you may wonder about the role of credit checks in the application process. Specifically, many might be concerned about how these inquiries negatively impact their credit score. Let’s explore these concerns in more detail and what you can do to prevent these records from heavily affecting your credit history

Do I Need to Get an Apartment Credit Check?

When applying for an apartment in Canada, your prospective landlord will likely request a credit check. This is a common practice to ensure they’re renting their properties to someone who has a good credit history, which can indicate financial reliability.

What Happens When I Get an Apartment Credit Check?

An important part of getting approval for an apartment is to prove your ability to keep up with rent. This is where credit checks and other financial indicators come in. The impact of this check depends on the type of credit inquiry. There are two types of credit inquiries: hard and soft.

Hard Credit Check

Hard inquiries occur when a lender, like a bank or credit card company, requests your credit report to make a lending decision. This type of check can lower your credit score by a few points and remain on your credit report for up to three years.

Soft Credit Check

In contrast, a soft inquiry does not affect your credit score. This is typically used for background checks, employment verifications, and rental applications. When a landlord requests your credit history as part of the rental application process, they usually perform a soft credit check. However, it’s important to note that some landlords may request a hard credit check.

What Can I Do About the Impact of Apartment Credit Checks?

If you’re concerned about the potential effects of a credit check on your credit score, there are several things to keep in mind:

  • Ask the landlord about the credit check they will perform: You can consider negotiating with them to ensure they do a soft inquiry instead of a hard credit check.
  • Limit the number of credit checks: If you’re applying to several apartments, try to space out your applications to avoid having hard inquiries on your credit report in a short period.
  • Be mindful of other credit inquiries: In addition to a credit check for an apartment rental, other queries, like applying for a loan or credit card, can also impact your credit score.
  • Improve your credit: A higher credit score can help you qualify for better rental terms and give you the upper hand over other applicants. To improve your credit, focus on paying bills on time, reducing your debt, and correcting errors on your report to ensure it accurately reflects your creditworthiness.

Ready for Your Next Apartment?

If you’re ready to find a new place to call home, you’re in luck! At CLV Group, we have rental options across Ontario, Quebec, and British Columbia. Check out our available apartments to get started.