Most landlords know they should run a credit check. Fewer know what to do with what comes back.
A score shows up. Maybe it’s 640. Maybe it’s 591. And suddenly an owner is staring at a number trying to decide if a stranger gets the keys to a $1,675/month rental based on three digits. That’s a lot riding on something most people don’t fully understand.
If you own rental property and you’ve ever wondered what a credit report actually tells you, what score is realistic to require, or when to approve someone who doesn’t check every box, this is worth reading. We’ll get into the real mechanics of credit checks, what the red flags look like in practice, and where landlords tend to go wrong.
“$3,000–$5,000+ | typical cost of one eviction”
In This Guide
What a Credit Report Actually Contains
The score is the headline. The report is the story.
When we pull a credit report through a tenant application, we’re looking at several categories of information:
- Payment history — whether the applicant has paid bills on time, including any 30, 60, or 90-day late marks
- Collections — accounts that went to collections, including who originated the debt (a landlord, a medical provider, a utility company)
- Public records — eviction judgments, civil court activity, bankruptcies
- Debt-to-income context — open credit lines, balances, and whether monthly obligations leave room for rent
- Length of credit history — how long the applicant has had active accounts
That last item matters more than people realize. A 22-year-old with a 610 score and no collections, one credit card, and a short history is not the same risk as a 38-year-old with a 610 score, two landlord collections, and a broken lease from two years ago. The number is the same. The situations are completely different.
The Score Range and Where 620 Comes From
Credit scores run from 300 to 850. A score below 620 is generally considered subprime by many lenders, while scores below 580 are often classified as deep subprime — both categories indicate a statistically elevated risk of missed or late payments. The 580–620 range is a gray zone most Hickory-area landlords look at case by case.
We typically look for 620 or higher, but we don’t stop there. We evaluate the full picture.
Here’s a rough breakdown of what different ranges signal in practice:
| Score Range | What We Generally See |
|---|---|
| Below 580 | Higher risk of payment issues — requires strong compensating factors |
| 580–619 | Gray zone — full report and income verification matter most |
| 620–679 | Acceptable baseline — look at the details before approving |
| 680–739 | Solid history — still verify income and rental history |
| 740+ | Strong borrower — note this doesn’t guarantee a great tenant |
That last row is worth sitting with for a second.
A High Score Doesn’t Mean a Good Tenant
This is one of the more counterintuitive things we tell owners, and it trips people up regularly.
A 750 credit score tells you someone manages revolving debt well. It says nothing about whether they’ll call about a maintenance issue instead of ignoring it, pay rent on the first of the month, or leave the property in decent shape on move-out.
Credit scores are built around borrowed money. Mortgages, car loans, credit cards. Rent payment history isn’t automatically included in standard credit score calculations — it only factors in if it’s been reported to the credit bureaus, whether by a landlord, a property management company, or a third-party rent-reporting service. And that’s a problem we’ll come back to.
The smarter read is to treat the score as a starting point. Rental history, income verification, and eviction records often tell you more about how someone will behave as a tenant than their FICO score does.
A credit report is most useful when you read the whole thing. The score gets you in the ballpark. The details tell you whether to sign the lease.
The Income Test That Most Landlords Skip
One of the most reliable filters we use alongside the credit check is the debt-to-income ratio.
The general rule: monthly rent shouldn’t exceed 30–33% of gross monthly income. At our average rental rate of $1,675/month across our portfolio, that means we want to see a qualified applicant earning roughly $5,000–$5,500/month gross before approval.
We’ve seen owners skip this step because the credit score looked fine. Then month three hits, the tenant gets behind on their car payment, and suddenly rent is competing with other obligations.
The credit check shows you payment history. The income check tells you whether rent is actually affordable for this specific person at this specific unit.
When to Approve Below Your Threshold (and When Not To)
Julie Correll, who manages our owner relationships and application reviews here at Premier, works through these judgment calls regularly.
One recent example: an applicant on a townhome in the Catawba County area came in with a 640 score but two collections on the report. On the surface, that flagged concern. But Julie pulled the full report and saw both collections were from medical debt, over four years old, with no prior evictions, and income verified at 3.5x the rent. That tenant was approved and has paid on time for 14 consecutive months.
Contrast that with an owner who came to us after self-managing. He had approved a tenant with a 591 score because the person seemed responsible in person. That tenant paid late three of the first six months. The owner absorbed roughly $500 in late fees he never successfully collected, and eventually handed the property to us to avoid escalating toward a possible eviction.
The difference wasn’t the score. It was what the report said behind the score.
Skipping the credit check for a referral or someone you know personally is one of the most common and costly mistakes we see. If that tenant pays late or skips the last month — which is the most frequent issue we deal with — you have no formal paper trail tied to a documented application process. That weakens your position significantly in small claims court. The potential exposure runs $1,675 to $3,000 or more in unrecovered rent.
Why Applying Your Standards Consistently Matters
North Carolina has its own Fair Housing Act that, like federal law, prohibits discriminatory application of tenant screening criteria. That means applying a 620 minimum credit score to one applicant but waiving it for another—without documented, legitimate reasoning—can expose a landlord to fair housing liability under both state and federal law. Even if you have genuinely good reasons, inconsistency creates exposure.
A single Fair Housing complaint investigation can cost a landlord thousands in legal fees before anyone determines whether a violation actually occurred. We see owners research landlord tenant lawyers free consultation options after the fact, which is the hard way to learn this lesson.
Our approach: we document every approval and every exception. The reasoning is written down. That paper trail matters.
What Credit Bureau Reporting Does to Payment Behavior
We charge $7/month per home to report tenant payment behavior to the credit bureaus. Both positive and negative history.
One owner we work with initially pushed back on this, calling it unnecessary. After we explained how it works, he came around. When tenants know that every on-time payment builds their credit score and every late payment dings it, they treat rent differently than when it’s invisible to the credit system. That property has had zero late payments in over a year.
This is also why we never hand out keys to show a property. We show every home in person, which means we’re meeting prospective tenants face to face before an application is ever submitted. Combined with a thorough credit review tracked through Propertyware, we’re building a complete picture before any approval goes out.
What Good Screening Looks Like in This Market
The Hickory area pulls from a wide mix of tenants: manufacturing workers, healthcare employees, and a steady stream of relocating families, including people moving in from higher cost states. We’ve seen this pattern firsthand. One of our long-term tenants relocated from Arizona in 2020 with a family of five, and has renewed without hesitation since. She commented that Premier’s responsiveness made the move feel manageable, which actually starts at the screening stage before a tenant ever moves in.
Out-of-state credit profiles can look unusual not because of poor payment behavior, but because of regional economic conditions. That context matters when you’re evaluating an application. A 600 score from someone who relocated from a state with higher average debt loads looks different than a 600 score from a local applicant with two active landlord collections.
We manage around 200 properties across Catawba, Burke, Alexander, Caldwell, and Lincoln counties with a vacancy rate of 1.0%. Thorough credit screening is one of the reasons that number stays low. Approving the wrong tenant doesn’t just create a headache. In North Carolina, even a relatively fast eviction through the North Carolina courts can take several weeks or longer, and contested cases or appeals can extend the process considerably, and the total cost to an owner can reach several thousand dollars or more when you add court fees, lost rent, and turnover—making eviction an expensive outcome for landlords as well as tenants.
At $1,675/month average rent, the stakes of one bad approval are meaningfully higher than they were five years ago when rents in this area averaged $1,200 to $1,300.
How to Think About Credit as One Tool, Not the Only Tool
A credit check is a starting point. So is an income check. So is rental history verification. So is an in-person showing.
The owners who get burned are usually the ones who leaned too hard on one signal and skipped the others. They saw a strong score and approved without checking income. Or they saw a borderline score and rejected someone who would have been a great long-term tenant.
We’ve been doing this locally for 21 years. The credit profiles that actually predict on-time payment behavior in this specific market are not always the ones that look cleanest on paper. Stable employment, no eviction history, and a clean rental record often outweigh a mediocre score, assuming income covers the threshold.
If running a tight, consistent screening process feels harder than it should be, we’re happy to talk through how we handle it for our owners.
FAQ
What credit score do most landlords in the Hickory area require?
Most landlords locally look for somewhere in the 580–620 range as a minimum. We typically start at 620, but we review the full credit report before making a final call, because the score alone rarely tells the complete story.
Does a credit check show evictions?
It can, but not always. Eviction filings don’t appear on your credit report; however, unpaid rent sent to a collections agency can show up in the collections section of your credit report — so a collections entry is the most likely eviction-related item a lender or landlord might see there. We always run a separate eviction history search alongside the credit check for this reason.
Can I legally reject an applicant based on their credit score?
Yes, as long as you apply the same standard consistently to every applicant. Under North Carolina and federal Fair Housing law, the problem isn’t using a credit score threshold. The problem is applying it differently to different applicants without documented justification. Inconsistency is where the legal exposure comes from.
What is a good debt-to-income ratio for a rental applicant?
The general guideline is that monthly rent should not exceed 30–33% of gross monthly income. On a $1,675/month rental, that means a qualified applicant should be bringing in roughly $5,000 to $5,500 per month before taxes.
Does reporting rent payments to credit bureaus actually change tenant behavior?
In our experience, yes. When tenants know their payment history is going to the credit bureaus every month, on-time payment rates improve. We charge $7/month per property for this reporting, and we track both positive and negative payments, which gives the tenant a real financial incentive to pay on time.
Should I approve someone with a low score if they have a referral from someone I trust?
A referral is a nice signal, but it’s not a screening standard. We’ve seen owners skip the formal credit check for someone they knew personally, and when that tenant paid late or skipped the last month’s rent, there was no documented application process to lean on in a dispute. Run the check regardless of how you found the applicant.