Does Rental History Matter When Buying a Home?

So you’ve decided to switch from apartment living to home ownership. Congratulations! 

Nowadays, qualifying for home ownership requires many applicants to jump through a few hoops before they can be approved for a mortgage. While it may be a hassle, this includes having their payment history put under a microscope.


Many of our clients ask us: “Does rental history matter when buying a home?” 

The short answer is: yes. While many people think that applying for a mortgage mostly involves presenting their income and their credit score, not everyone knows that your rental history can also play a huge role in helping lenders determine whether or not you meet the right qualifications for approval. If you are a first-time home buyer, your rental history is especially important in helping them sign off on your mortgage application.

Here are the three components of an applicant’s history that a lender will most closely examine to determine if they should be approved for a mortgage:

 

Eviction History

Have you ever been evicted from one of your living spaces? If so, you may want to carefully re-evaluate your rental history when applying for a mortgage. Lenders may ask this question to gauge whether or not you have been responsible with your finances in the past and to mitigate any potential risk.

If you’ve previously been evicted, this may not be the be all-end all of your mortgage application, however! The less recent an eviction is, the lighter the lender will usually investigate it. They may also want insight on the reasons behind the eviction, such as whether it happened due to an emergency, a health-related issue or from a lack of making regular payments.

Depending on the backstory, a past eviction may not necessarily break a deal. However, if your background shows that you have had more than one eviction, there is a high likelihood that this will hinder your ability to be approved for a mortgage until this information no longer shows in your credit history.

 

Credit Report

Lenders will look into your credit report to observe how responsible you have been with past payments. A large part of your credit score is made up of your payment history. If you’ve made late payments for bills in the past, this can lower your credit score. If you’ve previously been late with making rent payments, landlords often report this to credit bureaus. This means there is a strong chance that this will negatively affect your score as well.

The lower your credit score is, the less likely your bank will be to trust you with a loan. A decent credit score and a track record of making timely payments will increase your chances of being approved for a mortgage. Conversely, paying your rent and your bills on time will positively impact your credit score and heighten your chances of being approved for a mortgage in the future.

One solution we advise is to check your credit report regularly to ensure that there are no errors or discrepancies. Scheduling a regular credit report check annually can even help you offset any potential mistakes, as well as give you the chance to observe your spending habits if they need improvement.

 

Social Report

One of the emerging trends we’ve been seeing is lenders considering the relevance of a social media background check. In theory, this report is completed to assist in determining an applicant’s credit-worthiness by essentially running a check on a person’s on-line social footprint.

 

Payment History

Lenders will like to see that you have a history of meeting monthly deadlines when you make regular payments. This includes timely payments of your utility bills, credit bills and, of course, your past rental payments. A few late bill payments in your past is understandable — however, if you’ve made a routine of not paying your bills on time you may be seen as someone who can’t be taken seriously when it comes to financial responsibility. This might lead to a bank declining you for a mortgage.

If you are looking at ways to improve or build credit, paying your rent on time and honouring your lease obligation are two easy ways to achieve this goal.

 

Contact Us

If you have any further questions about how to how to prepare for a mortgage application and home ownership, contact Emerald Management and Realty Ltd. today! Our team is always happy to help. 


What Does The Management Fee Cover?

If you are a rental property owner, choosing to work with a property management company is a huge decision to make, both time and money-wise. If you have a packed schedule, additional occupation(s) or multiple properties to juggle, hiring an experienced property management company can be a great way to secure rental income while also saving yourself both stress and time.

Blog Post – Emerald Management & Realty Ltd.

Property managers usually collect fees for their services, which ensures that all areas of your property-related concerns are looked after. This includes some of the tougher work, such as eviction processes, dealing with difficult tenants, hunting down overdue rent payments or answering late-night phone calls. At Emerald Management & Realty Ltd., we also offer 24-hour emergency support to make sure any issues with your property are resolved promptly and efficiently. 

Management fees also cover other processes that are undertaken to ensure the success of your property. At Emerald Management and Realty Ltd, we also provide a value added service with our in-house maintenance department. Emerald’s maintenance team members cover responsibilities that are often beyond the scope of on-site building managers. 

Some of these value added services include: 

Managing Tenants 

When you hire a property management team, one of the main responsibilities they take on is managing your tenants. From finding your tenants to screening tenants to handling evictions, they are experienced with keeping everything in check. 

Financial Reporting

Knowing that the rent has been paid and that your property is being maintained is important.  Every month, Emerald Management & Realty Ltd. will send you an operating statement that includes income, expenses and a detailed ledger. This will keep you informed about how your real estate asset is performing.

Preventive and Routine Maintenance 

Property maintenance doesn’t just involve addressing problems when they arise or on a case-by-case basis. It also involves organized planning of maintenance tasks, which is often best-handled by a professional property management team. When maintenance is regularly handled, tenants are more likely to remain comfortable and happy. 

Preventive maintenance helps keep the property functioning in good condition at all times. This may include regular plumbing and leak checks, extermination checks to keep the property pest-free, regular landscaping, trash removal or snow removal. Routine maintenance involves scheduling specific tasks that need to be done repeatedly and consistently, such as cleaning leaves from the front lawn or changing HVAC filters every few months. 

Renovations and Repairs 

It is the property manager’s responsibility to either fix issues when they arise or take care of hiring another professional to handle them. This means they will be in charge of finding reliable plumbers, contractors, electricians or other professionals to make sure the job gets done right. 

Reach Out To Us 

Overall, as your property manager will be looking after your most important assets, our services have been developed to help ensure peace of mind. To learn more about our property management, maintenance and other services at Emerald Management & Realty Ltd., contact us today!


Emerald Management & Realty Ltd. 2020 Top Choice Nominee

2020 Top Choice Nominee

 

Emerald Management & Realty Ltd. is proud to announce that we are an Official 2020 Top Choice Award Nominee for the 5th year in a ROW!

Thank you to all of those who have taken the time to nominate us as your top choice property management company in Calgary, AB!

Now, we need your help to WIN! Voting is now open and if you feel that we have earned your vote, we would appreciate you taking the time to vote for us.  Your vote will automatically enter you into a draw for a chance to win a grand cash prize of $2000 or one of many Toppy T-shirts.

You can vote for us here: VOTE for Emerald Management.  

Voting ends December 20th, 2019.

We would love to win the Top Choice Award… But we need your help to do so. If you believe we are your Top Choice, why not help us spread the word!

Thank you for your time and we appreciate your vote!  Winning the Top Choice Award is one of the largest endorsements a business can receive within North America & Europe, so this is a BIG deal!

From all of us at Emerald Management & Realty Ltd. —  THANK YOU for your continued support and the opportunity to provide property management services to our community in Calgary & Area.

 

P.S your written feedback in the survey is anonymous but very important to us, as it allows us to know what you love about us and what we can improve to continue serving you every day and providing the best customer experience possible. Many thanks in advance!


Resident Manager of the Month – September 2019

 

We are pleased to announce that  Christian K. of Sundance Apartments, located in Calgary has been chosen as Resident Manager of the month.

Christian has been at this rental property since April and has done a commendable job at the 138 unit high rise rental building.
 
Previously, Christian had been employed with Emerald Management & Realty Ltd. in the position of Resident Manager at two other locations.  He was also a great asset at those rental buildings. He establishes a great rapport with his tenants and they benefit from his years of experience.
 
Congratulations Christian!


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