Friday, August 19, 2011
Renting With No Verifiable Income
The large majority of Austin apartments and rentals will require you to prove that you can afford to pay the amount of rent they are charging before they will lease to you. In apartment speak, this is called ‘verifiable income’. In short, verifiable income would be a steady paycheck that you can show a pay stub or have an employer verify that you receive.
There are several sets of people that may not have what is considered verifiable income, yet they would still be able to afford rent. For example you may get paid in cash or live off a bank account, or the support of another person. If you fall under one of these categories, there are some things that you can do to verify your ability to afford rent besides show a pay stub:
1) Have a Cosigner. In Texas, cosigners don’t have to sign the lease, or even be in the city you are renting in. Their purpose is to financially back-up the renter in the case that they are unable to pay rent. The cosigner application is a separate lease. If the renter does not default on their rent, then they will not be affected at all. A cosigner will typically have more stringent income requirements of as much as 5 times rent and exceptionally strong credit.
2) Supply Bank Statements. Typically they will require 3 times rent TIMES the lease term. For example, on an $800/mo rent and a 1 year lease term, you will need $800 * 3 * 12 mo = $28,800 in the bank.
3) Supply Tax Returns. If you are self-employed, but do have steady income, you may be required to supply the previous year’s tax return or even multiple years worth of tax returns to verify your income level.
3) Supply a Letter of Hire. If you are new to a job, or paid in cash, then an apartment might allow you to bring in a letter from your manager, signed on verifiable company letterhead stating your start date and your expected wages.
Renting without verifiable income can complicate your application process and not all Austin apartments will accept alternate forms of verification. An apartment locator can help you determine your best options for qualifying at the apartments you want.