Did you fail the rental property screening? Here's why you might not pass, and what you can do to resolve the issue and how to sign the contract.

"Priority" when you don't pass the screening

If you fail the rental property screening, blindly applying for properties will be counterproductive. The important thing is to understand the points that are looked at in the screening and correctly prioritize what you should review. In particular, the three points of rent setting, guarantee conditions, and property type have a major impact on the screening results. By first adjusting the most influential factors, you can efficiently increase your chances of passing the screening.

The top priority is to review the "rent setting (within ◯% of take-home pay)"

The most important thing in rental property screening is the balance between rent and income. Generally, rent should be within 30% of take-home pay, and if it exceeds this, it is likely that you will be judged as having poor ability to pay.

For example, if your take-home pay is 200,000 yen, a safe rent range would be around 60,000 yen. If you have previously been rejected for a property, your first priority should be to lower the rent range by "compromising a little on the distance to the station," "expanding the age of the building," or "reconsidering the floor area."

In many cases where your application is rejected even after submitting proof of income, this is due to the rent being set incorrectly in the first place, so the quickest way to pass the screening is to first adjust the amount to a more reasonable amount.

Next, rearrange the "guarantee (guarantor company/joint guarantor/contractor)"

If you still cannot pass the screening even after reviewing your rent setting, you will need to reconsider how you structure your guarantee. While it is common for rental contracts to now involve the use of a guarantor company, each guarantor company has different screening criteria, and it may be difficult to pass depending on your past history of default and employment status.

In such cases, it is effective to consult with the real estate company to see if you can change to a different guarantor company. It is also not uncommon for the screening to be approved by having a relative with a stable income act as a co-guarantor, or by switching to an agency contract or corporate contract with your parent or company as the contract holder. Guarantor conditions can be flexibly rearranged, so it is important to keep adjusting without giving up.

Finally, switch to "Property Type (Properties that are relatively easy to pass the screening)"

If the screening is still strict even after adjusting the rent and guarantor conditions, consider switching the property type itself. For example, UR rental properties and public corporation rental properties have different screening standards than private rental properties, and in some cases you can move in without a guarantor. Also, shared houses, rental properties with furniture and appliances, and monthly apartments tend to have relatively flexible screening.

Especially if you have just changed jobs or are experiencing an unstable income, it is a realistic option to secure a home in such a property and then look for a rental property again once your situation has improved. It is also important to think about changing the type of home you live in, rather than getting too hung up on the screening process.

What is a rental property inspection? When, who, and why?

Rental property screening is a procedure to determine in advance whether a tenant is suitable for renting a property. The screening is conducted immediately after application, and its main purpose is to prevent the risk of rent arrears and other problems. By understanding the screening process, the entity that makes the judgment, and the points that are checked, you can understand the reasons why you may not pass the screening and take preventative measures.

Here we will explain the rental property screening process.

Tenancy screening process

The rental application screening process generally follows the steps of "application → screening → notification of results → contract."

1. First, fill out the application form with information such as your place of employment, income, and guarantor.
2. Submitted to the management company, landlord, or guarantor company through the real estate company
3. After that, your income, credit information, guarantee conditions, etc. will be checked, and if there are no problems, the results will be announced within one to several days.

Please note that you may be asked to submit additional documents, and delays in responding may result in longer review times. To ensure a smooth process, it is important to prepare all the necessary documents before applying.

Who will be judging?

There is no single organization that handles tenant screening. In most cases, the landlord (lessor), management company, and rent guarantee company are involved. Recently, it has become mandatory to use a guarantor company, and it is not uncommon for the guarantor company to make the actual decision. Guarantor companies place emphasis on the applicant's income and credit information, and screen mainly on their ability to repay.

On the other hand, landlords and management companies also consider personality, compatibility with the property, past trouble risks, etc. Therefore, it is important to understand that the impression of your interactions and responses with the real estate company will indirectly affect the screening results.

Four points to look at in the review

The four main points that are looked at in rental property screening are income, credit information, guarantee, and personality.

1. First of all, it is important to consider whether rent is within 30% of your take-home pay.
2. Next, your credit information, such as your credit card and loan default history, will be checked.
3. Furthermore, whether the conditions for a guarantor or guarantee company are met is also a major factor in making a decision.
4. Finally, your personality and manners will also be evaluated when interacting with the real estate company and management company.

The first step in preparing for the review is to understand where you are concerned about these four points.

Documents and information required for rental screening

During rental property screening, applicants are required to submit multiple documents and information to verify their identity and ability to pay. If documents are missing or incomplete, the screening process may take longer or the applicant may be judged unfavorably. Identity verification, employment verification, and proof of income are particularly important items, and preparing them in advance will help the screening process go more smoothly.

This chapter introduces the documents and information required for the rental application screening.

Items related to identity verification and employment verification

Identity verification requires the submission of official identification such as a driver's license, My Number card, or passport, which verifies that the applicant is a real person.

Additionally, to confirm your employment status, you will need to enter the name, address, and contact information of your employer on the application form, and if necessary, your employer may be contacted by phone to confirm. You may also be asked to submit your employee ID or health insurance card, so it is a good idea to have documents ready to prove your employment, especially if you have just changed jobs or have only been employed for a short time. False information may result in your application being rejected, so it is important to enter accurate information.

Proof of income

During the tenant screening process, you will be asked to submit proof of income to determine whether you can pay rent steadily. For company employees, this typically includes a tax withholding slip and the most recent few months' pay slips.

If you are a sole proprietor or freelancer, you will need to submit your tax return, tax payment certificate, and documents showing your sales trends. Even if you are working part-time, you may be able to pass the screening if you can prove your continuous income. If your income is unstable, remember that you can also submit a copy of your bankbook showing your savings balance to further demonstrate your ability to pay.

Items that are often overlooked on application forms

The application form has many other items to check besides income and place of employment. Particularly often overlooked are emergency contact information, information about cohabitants, and purpose of moving in. If the emergency contact is not a relative, it may be deemed a cause for concern.

Also, if you have any cohabitants, you must accurately describe their relationship to you and the number of people living with you. Omissions or ambiguous expressions may result in additional confirmation or delays in the screening process. The application form is treated as "screening material," so the key to increasing your chances of passing the screening is to fill in all the fields accurately and carefully.

Common examples of people who fail rental screening

There is no single reason why someone may not pass the rental property screening process, but in most cases, multiple factors come into play. In particular, the balance between income and rent, employment status, credit information, guarantee conditions, personality, and usage history have a significant impact on the screening results.

Here, we will explain some common "typical examples of people who are likely to fail the screening" and help you sort out which one applies to you.

Rent doesn't match income

The most common reason for not passing the screening is when the balance between rent and income is not right. Generally, rent should be within 30% of take-home pay, and if it exceeds this, you are more likely to be considered at high risk of not paying rent. Even if you are a full-time employee, if your rent is too high, there is a good chance that you will fail the screening.

Some people apply with the expectation of receiving a bonus or income from a side job, but it is important to note that the screening process focuses on whether you can make stable monthly payments, so expected income is not easily evaluated.

Short employment status or length of service/unstable income

Employment type and length of employment are also important factors in the tenant screening process. If you have just changed jobs and have a short length of employment, or if you work as a temporary employee, contract employee, or part-time employee, and your income fluctuates, you are more likely to be seen as having concerns about your future ability to repay.

In addition, even for sole proprietors and freelancers, if your income fluctuates greatly, the screening process tends to be stricter. However, if you can provide stable business partners and tax returns for the past few years, your evaluation may improve.

History of default on rent, loans, and credit cards

If you have a history of defaulting on rent, loans, or credit card payments, this will have a significant impact on your application. This information is shared with guarantor companies as credit information, and a history of default tends to be seen as a high payment risk.

Even if you have made a one-time late payment several years ago, you may not pass the screening depending on the details. Even if you are currently making payments without any problems, it is important to understand that the information will remain on your credit report for a certain period of time.

Large amount of debt/large amount of revolving credit and installment

The total amount of debt and payment status will also be subject to review. In particular, if you frequently use revolving credit or installment payments, you may be deemed to have a large amount of fixed monthly expenses and may be deemed to have little ability to pay rent.

Having debts does not necessarily mean you will be rejected, but if your repayment amount is large compared to your income, it will be a disadvantage. By streamlining your revolving credit balance or paying it off before the rental application screening, you may be able to increase your chances of passing the screening.

I can't provide a guarantor or emergency contact

If you are unable to provide a guarantor or emergency contact, you may not pass the screening. Even if you use a guarantor company, an emergency contact is required in most cases. If you only have friends and not relatives, it may be considered a cause for concern.

In addition, screening tends to be stricter if the guarantor does not have a stable income or is too old. Guarantor conditions can be flexibly revised, so it is important to consult with the real estate company.

Incomplete or false application details

If there are any incomplete or false information in the application form, it may result in your application being rejected. Not only omissions and typos, but also attempts to make your place of employment or income appear better than they actually are will significantly damage your credibility if discovered.

Accuracy and consistency are emphasized during the screening process, so any discrepancies in information between documents will result in a negative evaluation. Be sure to review your application and ensure that the facts are accurate.

Concerns about personality and communication

Although it is surprisingly often overlooked, personality and communication skills also affect the screening process. Being arrogant in your dealings with the real estate company or management company, being slow to respond, or not keeping promises can lead to the judgement that there are concerns about problems after moving in.

Landlords and management companies also look to see if they can rent to you safely for the long term. Simply being polite and honest can make a big difference in their impression.

Problems are expected with roommates and purpose of use

If the number of people living with you, their relationships, or the purpose of using the property are unclear, your application may not pass the screening. For example, if there is a possibility that there are undeclared cohabitants, or if the property is suspected of being used as an office or sublet, this poses a major risk for the landlord.

Be wary of any anticipated uses that deviate from the terms of the contract, such as whether pets are allowed, playing musical instruments, etc. To avoid any issues after moving in, it is important to honestly and clearly communicate the purpose of use and the status of cohabitation.

Specific measures to make it easier to pass the examination

Even if you are worried about the rental property screening process, it is possible to increase your chances of passing by taking certain measures. The key is to adjust the conditions and how you communicate them to match the points that will be looked at during the screening process. In particular, the rent setting, guarantee conditions, contract type, and the choice of real estate company will have a major impact on the outcome.

Here we will explain some easy-to-implement and effective steps.

Lower the rent range

The most effective way to counter the screening process is to review your rent range. Generally, rent should be within 30% of your take-home pay, and anything above this will likely be deemed a sign of insecurity in your ability to repay. If you fail the screening process, it is effective to lower the rent by increasing the walking distance from the station, increasing the age of the building, or streamlining the facilities.

By adjusting the amount to "something you can definitely pay with your current income," the evaluation from the guarantor company and landlord will improve significantly, and in many cases you will pass the screening even under the same conditions.

Shows deposits

If your income is unstable or you have only a short period of employment, you can supplement your ability to pay by showing your savings. By submitting a copy of your bankbook or proof of your balance, you will be more likely to be judged as having the financial means to pay rent even if your income temporarily decreases. This is an especially effective measure for freelancers and those who have just changed jobs.

However, please be careful as making false deposits may have the opposite effect. Presenting a record of continuous savings will help you pass the screening.

Make a cosigner a relative with a stable income

When choosing a guarantor, it is important to choose a relative with a stable income. The guarantor's annual income, employment status, and age will also be subject to review, so ideally, the guarantor should be a full-time employee with a long track record of employment.

Even if you use a guarantee company, having a guarantor will often improve your rating. Relatives are more trustworthy than friends or acquaintances, and this is a key factor in favor of the screening process.

Change guarantor companies/Choose a guarantor company that meets your screening criteria

Each guarantor company has different screening criteria. It is not uncommon for a person to be rejected by one guarantor company but accepted by another. Compatibility may vary depending on past default history and employment status, so it is a good idea to ask the real estate company if you can change guarantor companies.

In particular, if a property has a strict guarantor company, the criteria may not be met. Having multiple options is the key to passing the screening.

Set the contractor as your parent or employer

If it is difficult to sign a contract in your own name, you can also have your parents or employer sign the contract. A "representative contract" where your parents sign the contract and you live as the tenant, or a "corporate contract" where your company signs the contract, are typical ways to make it easier to pass the screening. This is especially effective for new members of society or people who have just changed jobs.

However, this may not be possible depending on the property, so you should check with the real estate company in advance.

Cases where paying rent in advance and negotiating terms works and cases where it doesn't work

In some cases, paying rent in advance or negotiating the terms can help you pass the screening, but this is not a universal solution. In properties where the landlord makes the decision on their own, paying several months' rent in advance may be considered.

On the other hand, advance payments are often not valued in screenings led by guarantor companies. Whether negotiations are effective or not depends on the property, so it is important to have the real estate company assess the situation.

Dealing with real estate companies carefully

The screening process is not only influenced by documents, but also by the impression of the interactions. Slow communication, arrogant attitude, and vague answers to questions will make the management company and landlord uneasy.

By being courteous and sincere in your communication, you will be more likely to be judged as a "tenant who causes less trouble." Even being mindful of basic manners can make a difference in the results of your screening.

Ask a real estate company that is strong in screening

If you are worried about the screening process, it is important to hire a real estate company that has experience and understands your situation. A real estate company that is strong in screening will suggest options that are likely to pass the screening process during the property selection stage and will also properly explain the situation to the guarantor company and landlord.

By honestly explaining your situation and consulting from the beginning, you can avoid unnecessary rejections and lead to a smooth move-in.

By attribute | Countermeasures for cases that are often said to be difficult to pass

In rental property screening, there are cases where applicants' attributes make it difficult to pass. However, the attributes themselves are not the problem; the important thing is how you can prove your ability to repay and your continuity. By taking measures appropriate for each individual, such as unemployed, students, freelancers, and foreign nationals, you can increase your chances of passing the screening.

Here we will explain the measures for each attribute.

Unemployed/immediately after changing jobs: Measures to be taken with job offer letter/savings/changing contract holder

If you are unemployed or have just changed jobs, the screening process tends to be stricter due to a lack of income history. In this case, it is effective to submit a job offer letter or employment contract to show that your income in the near future is confirmed.

Also, if you have sufficient savings, submit a copy of your bankbook to demonstrate that you can afford to pay rent for a certain period of time. Furthermore, in some cases, your evaluation may improve if you sign a proxy contract with your parents as the contract holder or have a co-guarantor. It's important to not only show your current situation of having no income, but also to specifically show your future outlook.

Students: Parental contracts/guarantees, and part-time income

Students do not have a stable income, so as a general rule, parental involvement is a prerequisite. Having a parent as the contract holder or a co-guarantor will make it easier to pass the screening. Even if you have income from a part-time job, it is often only evaluated as a supplementary factor in the screening process, so it is best not to expect too much.

If you have a withholding slip or pay slip, submitting it to show that you have a steady income will lead to a positive evaluation. Choosing a property for students or a property that allows students is also an effective measure.

Sole proprietors and freelancers: How to file tax returns and report sales trends

Self-employed individuals and freelancers tend to be judged as having uncertain income stability. To counter this, it is important to submit tax returns for the past one to two years and demonstrate a continuous income track record. Additionally, you will be evaluated better if you can provide documents showing monthly sales trends and explain the continuity of your business partners.

If you have just started your business, you may be able to pass the screening by showing savings or having a guarantor. The key is to prepare documents that can be explained in numbers.

Dispatch/contract employee: explanation of contract period/prospects of renewal

Temporary and contract employees may be viewed unfavorably during screening because their employment period is limited. In such cases, it is effective to clearly explain the current contract period, renewal history, and future renewal prospects. Submit an employment contract or working conditions statement to show that you can expect to earn income for a certain period of time.

Even if you have only a short period of employment, if you have worked for the same staffing agency for a long time, it may lead to a positive evaluation. It is important to specifically communicate the continuity of your income.

Foreign nationality: Residence card, place of employment, and communication concerns

Foreign nationals may be subject to more strict screening due to concerns about their residence status and language skills. First, submit your residence card to show that you have sufficient time left on your visa. It is also important to clearly state your place of employment and income, and explain that you are able to live a stable life in Japan.

If you are worried about communicating in Japanese, it may be a good idea to get the help of an interpreter or a guarantor. By making an effort to communicate politely, you can ease the concerns of the management company and landlord.

Switching property types when the screening is still strict

If you are still unable to pass the tenant screening even after reviewing your rent settings and guarantee conditions, switching the property type itself can be an effective option. There are different types of rental properties with different screening systems, so not sticking to a typical private rental property will increase your chances of being able to move in.

Here we will introduce some typical property types that are easy to consider even for those with strict screening criteria.

Find properties that don't require a guarantor company

If you don't pass the guarantor company's screening, one option is to look for a property that doesn't require a guarantor. In these properties, the landlord or management company directly decides whether or not you can move in, so your personality and willingness to pay may be given more weight than your credit score.

However, there are only a few properties available, and in some cases you may be required to pay rent in advance or have a guarantor. Since conditions vary depending on the property, it is important to clearly communicate to the real estate agency that you are looking for a property without a guarantor company.

Options with "different systems" such as UR rentals and public corporation rentals

UR rental properties and those rented by the Japan Housing Corporation have different screening criteria than private rental properties. In many cases, no key money, agency fees, or renewal fees are required, and in some cases, no guarantor is required. Instead, you must meet certain income and savings criteria.

It is characterized by the fact that current repayment ability is emphasized rather than credit information. If the conditions are met, it is a strong option for those who are worried about the screening process.

Shared house, furnished with appliances, etc.

Shared houses and furnished rental properties tend to have more flexible tenant screening than regular rental properties. Shared houses in particular often do not require the use of a guarantor company, which is an attractive feature as it reduces initial costs. Furnished properties are designed for short-term tenants and people who move frequently, and may not be as strict about income or years of employment.

Although there are restrictions on how you can live, it is a realistic option for those who are worried about the screening process.

Secure a place to live on a monthly/weekly basis

If you are unable to move into a regular rental property right away, you can also secure a place to live temporarily in a monthly or weekly apartment. These are not rental contracts, but rather usage contracts, so the screening process for applicants is often simple.

By living in a property for a short period of time while waiting for a job change or for your income to stabilize, and then looking for a rental property again once the situation is right, you will increase your chances of finding a property that meets your desired conditions.

What to do after failing the examination

Even if you fail the rental property screening, there is a good chance that you will pass the next application if you act appropriately. The important thing is not to repeat the same actions without sorting out the reasons. By understanding the reasons for your rejection, deciding when to reapply, and reviewing the conditions step by step, you can prevent unnecessary rejections.

Here we will explain the correct steps to take after the audition.

Can you tell me why it fell off?

The reasons for rejecting a rental application are not always disclosed in detail. In particular, if a guarantor company is involved, the individual reasons for the decision are often not disclosed. However, there are cases where the real estate company will tell you the general reasons, such as "rent setting," "guarantee conditions," and "income."

It is important to listen calmly to confirm what you can do next, rather than emotionally questioning them. Even if you can only understand the direction of the reason, it will be easier to come up with next measures.

Timing of reapplication and ways to avoid applying repeatedly under the same conditions

It is best to avoid applying for another property with the same conditions immediately after being rejected.

If you have a history of multiple screenings in a short period of time, guarantor companies may be skeptical. When reapplying, be sure to change at least one of your conditions, such as lowering the rent range, adding a guarantor, or changing the property type.

You can increase your chances of being accepted by taking your time and adjusting your conditions before applying.

Fix the problem and then try again

If the reason for your failure is clear, it is important to resolve the issue before searching for a property again.

For example, if you have a lot of debt or revolving credit, you should start paying it off, if you have just changed jobs, you should work for a few months, if you have little savings, you should increase your savings, etc. There are many points that can be improved. Temporarily using a monthly rental property to improve your situation is also an effective way.

Allowing time for preparation can make a big difference in the outcome of the next review.

Points to note so you don't rush into relying on dangerous companies

Immediately after failing the screening process, people tend to feel anxious and be attracted to companies that emphasize "guaranteed approval" or "no screening required." However, there is a risk that they will charge high fees or force you into an illegal contract. Legitimate real estate companies cannot completely skip the screening process.

Beware of overly sweet words, and be sure to check whether the property has a real estate license and the contents of the contract. Making a calm decision will lead to a safe home search.

Final checklist for a smooth audit

To smoothly pass the rental property screening process, it is essential to make final checks before applying. Most applications are rejected due to insufficient rent, documentation, or guarantee conditions. To avoid panicking after applying, it is important to use a checklist in advance and check each point that will be looked at during the screening process.

This chapter provides a checklist to help you pass the screening process smoothly.

Rent setting check

The first thing you should check is whether the rent is appropriate for your current income. A good guideline is to keep it within 30% of your take-home pay, and if it exceeds this, the screening process will become much stricter. It is also important to consider the actual rent, including management fees and common area charges.

Don't rely on bonuses or side job income, but double-check that you can reliably pay the amount every month. There are many cases where simply reviewing the rent setting can significantly improve your chances of passing the screening, even with the same conditions.

Document check

Check that you have all the necessary documents for your application and that they are complete and complete. It is important to make sure that your ID, proof of income, employment confirmation documents, etc. are up to date.

In addition, any omissions in the application form, typos, or discrepancies in information between documents will have a negative impact on the review. Before submitting, review your application again to ensure that the facts are accurately stated. The completeness of your documents is directly related to the credibility of the reviewer.

Warranty Check

Finally, check whether the guarantor conditions are appropriate. If a guarantor company is specified, consult with the real estate company to see if it matches your past screening results and your attributes. If you are able to use a guarantor, it is preferable that the guarantor be a relative with a stable income. Don't forget to check whether an emergency contact is available.

The results of the screening often change depending on how the guarantee is structured, so it is important to check in advance.

FAQ

Many people have many questions about rental application screening, such as "How long will it take?" and "What should I do if I'm rejected?"

Here, we will look at some frequently asked questions and provide easy-to-understand explanations of common stumbling blocks during the rental application process and the correct way to respond.

Q. How long does it take to process a rental application? Why does it take so long?

The average number of days required for a rental application screening is one to three days. However, if confirmation from the guarantor company, management company, or landlord is required, or if the application falls on a weekend or public holiday, it may take up to a week. The main reasons for delays in the screening process are insufficient submitted documents, confirmation of the written information, or inability to confirm employment status.

Additionally, applications can take longer during busy periods (such as moving season) when guarantor companies are busy reviewing properties. By preparing all necessary documents in advance and being able to contact the company, you can prevent the review process from being prolonged.

Q. Can I cancel after the review?

As a general rule, cancellation is possible before signing a contract. Even after passing the tenant screening, there are many cases where cancellation fees are not incurred as long as it is before the important matters explanation session or the lease agreement is signed.

However, if you have paid an application fee or a deposit, you should check the refund conditions. Since it becomes difficult to cancel after signing and stamping the contract, it is important to consult with the real estate company as soon as possible if you are unsure.

Q. Do I need a guarantor or a guarantor company?

In recent years, the number of properties requiring the use of a guarantor company has been increasing. Therefore, even if you have a guarantor, it is common for you to be screened by the guarantor company.

However, having a guarantor may give you an advantage in the screening process. Depending on the property, you may be required to have a guarantor company only, or both a guarantor company and a joint guarantor, so be sure to check the conditions in advance. It is important to choose a guarantee arrangement that suits your situation.

Q. I failed twice, what should I do differently next time?

If you have been rejected more than twice, the results are unlikely to change even if you continue to apply with the same conditions. Next time, be sure to change at least one of the conditions, such as lowering the rent range, adding a guarantor, changing the guarantor company, or changing the property type.

It is also important to confirm with the real estate company the reasons for your rejection and take appropriate measures. If necessary, it is also effective to take some time off and retry after improving your income and savings.

summary

Even if you fail the rental property screening, your chances of passing can be significantly improved by correctly understanding the reasons and taking systematic measures. It is especially important to review the rent setting, guarantee conditions, and property type. Adjust the rent to within 30% of your take-home pay, and be flexible in considering how to arrange the guarantor company, co-guarantor, and contract holder.

Even in cases where your attributes put you at a disadvantage, you can overcome them by preparing the necessary documents and explaining things in an ingenious way. If that's still difficult, it's effective to broaden your options to include UR rentals, shared houses, and monthly apartments.

Even if you fail the screening, don't panic. Identify the reason, change your conditions, and reapply. This will be the shortcut to finding your ideal home.