If your credit is less-than-stellar and you’re planning on moving to a new city (especially a new city in which the cost of living is higher than your current location), there are a few issues you might encounter.
First, if you’re planning on forgoing movers and moving your belongings yourself, make sure that you’re actually able to rent a car or truck; sometimes, this is an issue with bad credit.
Second, and more significantly, getting a mortgage for a new home will prove more difficult than if your credit was okay; many loan companies require a minimum 620 credit score. Of course, it’s not impossible, but it certainly is harder.
Now that you know the challenges facing you, here are 4 tips that can make moving to a new city easier, even with bad credit:
1. Rent first (before buying)
Since it’s not easy getting a mortgage with bad credit, renting first is a good idea. When you rent instead of buy, you’ll not only have more flexibility in terms of where you live but if things don’t work out with your job, it will be much easier to move to a different city. When searching for rentals, remember that the rental price doesn’t always including utilities, so make sure that you budget bills into your calculations.
2. Avoid moving at peak times
When you move during off-peak times (early fall and winter), you can not only save money on the actual move (if you’re hiring movers), but you also have a better chance of finding an apartment that’s more affordable, since there is less competition and landlords may be more eager to start collecting rent. And if you spend less money on moving and rent, you’ll have more money freed up to go toward fixing your credit.
3. Start paying more than the minimum balance on your credit starting today
If you have bad credit, the first step toward fixing it is paying off your debt. In order to make a dent in your debt, you need to pay more than the minimum balance on your credit card statements each month. Once you start doing this, you’ll be able to slowly improve your credit score, opening the door to many more opportunities in your new city.
4. Transfer your balance and reduce interest
Here’s another way you can improve bad credit: Some credit card companies offer 0% interest if you transfer credit from one of your accounts to theirs; if you do this, at least you’ll decrease your interest and make monthly payments more feasible. Plus, it works for both large and small debts.
Before you can do anything to improve your credit, you need to create a budget. If you don’t have one, you’ll have no idea how much you can realistically spend on truck rental/moving services, rent, utilities, buying a car/public transport, food, paying off your debts, etc. Creating a budget is the only way to keep yourself from overspending and moving on from bad credit successfully.
You Can Do This
While moving to a new city with bad credit might seem like a lost cause, don’t give up hope. Just because you have bad credit now doesn’t mean it will be that way forever, and moving to a new city can be just the opportunity you need for improving your credit. So make some calculations, create a budget, and make sure you choose a city where the cost of living is manageable. And good luck!