Renting property under debt review
“I’ve been struggling to pay off my debt and to manage my finances. As a result, I am now under debt review. Can I still rent a property even though I am under debt review?”
The answer, in short, is yes. The process of debt review is considered to be a saving grace for those who are struggling to pay off their debt and manage their finances. Even though debt review helps you with your financial management, it is common to also feel limited by the debt review. Whilst under debt review, you can take out new loans, as debt review is designed to help you settle your current debt. You may, however, have additional financial concerns when under debt review, for example, the question of whether you can rent a property while under review.
Debt review is not a credit agreement itself, which means that if you are under the debt review process, you can still rent a property. In addition, there are absolutely no legal requirements that state that an individual who is undergoing a debt review, cannot rent a property or be party to a lease agreement.
It is important to remember that when you apply for a rental, real estate agents, as well as landlords, will run a full background check on your financial situation, which includes credit agreements, judgements, defaults and whether you are currently under debt review. Take note that if you are deemed unfit for the rental, it will be a result of some other factor, as real estate agents are not permitted to deny your application solely on the fact that you are under debt review.
How can you increase your chances of securing a lease agreement while you are under debt review? It is common for real estate agents and landlords to still have some concerns with regards to your debt review status. To settle these concerns, your debt counsellor may provide the real estate agent or landlord with a proof of budget that indicates that you are in fact able to afford the rental amount every month. You may also provide the real estate agent or landlord with bank statements that indicate that you can afford the rental amount. You can also offer a double deposit, or another person to co-sign the lease with you.
This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE).