How to Determine Income Level to Qualify for an Apartment

Most landlords will request evidence or verification of tenant income before renting an apartment.
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There's not one universal system that landlords use to determine the necessary income level for an apartment. Most use a rule of thumb that income should be three times the rent payment, or that rent can't exceed 25 percent of the applicant's take-home pay. If your current income isn't sufficient to rent an apartment, you may be able to add a guarantor to secure the lease.


Income Matters

Along with your credit history, eviction records and references, income is one of the most important considerations a landlord makes when evaluating tenants. It's expensive for landlords to have gaps in rental income and it takes time to find new tenants, so they want to make sure you'll be able to pay the bills. Expect a landlord to ask for proof of your income such as recent pay stubs or the contact information for your employer. Along with the dollar amount of income you earn, the landlord will also evaluate how steady your stream of income is.


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25 Percent of Take-Home Pay

Every person's individual situation is a little different, but there are recommended standards for income and rent expense. According to, your housing costs shouldn't exceed 35 percent of your gross pay or 25 percent of your take-home pay. Your gross pay is your total annual salary plus bonuses and commissions. Your take-home pay is your gross pay minus taxes, retirement and insurance deductions, and any other money you have deducted from your paycheck. That means that if your take home pay is $3,000 a month, you should aim to pay less than $750 in monthly rent.


40-Times Rent

Individual landlords use different standards and rules of thumb to decide if a tenant has enough income to rent an apartment. Some will use the 35 percent of gross pay or 25 percent of net pay rule. In New York, many landlords use a 40-times rule. This rule states that the tenants' combined income should be more than 40 times the monthly rent amount. For example, a landlord using this rule would only rent a $1,000 a month studio to a tenant if the tenant's annual income was over $40,000.


Other Considerations

While income might be the most important factor for renting an apartment, it isn't the only one considered. At the end of the day, the landlord just wants to know that you can pay rent. If you don't have a high paying job but can show the landlord that you have a large amount of money saved up, he might waive the income requirement. If you don't make a high salary now but have recently accepted an offer for a higher paying job, you can also give that information to your landlord. If you really don't have the resources to make the rent payment, the landlord may allow you to add a guarantor or cosigner to the rental agreement. This person is legally obligated to make payments if you default.



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