Screening Apartment Application Rejections Rise in California
The percentage of apartment-renter applicants who fail to meet landlords? minimum acceptance standards has continued to climb since the pandemic ? forcing landlords to get creative and seek alternatives.
Rita Collins, vice president of a vertically integrated management company based in Los Angeles with 23 mostly ?B? and ?B-? properties in California, said the percentage of declined applications at some locations has reached more than 50% nationally since the pandemic. For her company's portfolio, that number has gone up 20%, post-COVID.
?It?s been increasing every year,? Collins said, with affordable housing communities seeing the most significant spikes.
?Many people accumulated a good deal of debt, given their financial concerns since the pandemic (around 2021), which has turned to ?bad debt? and it?s coming back to haunt their credit ratings,? she said.
Furthermore, traditional credit-based screening excludes a large share of otherwise reliable renters, shrinking the applicant pool at a time when operators are trying to accelerate lease-up.
To help qualify more renters under her company?s consistent approval guidelines, Collins has been relying on apartment industry supplier partners that take a more holistic approach to credit screening, including payment history, to determine their ability to pay.
Companies such as CoSign, TheGuarantors and OneApp offer bond agreements that guarantee the property against lost rent, legal fees and damages that could occur if a renter defaults and is evicted.
?This creates a cocoon, so to speak, around the landlord,? Collins said. ?Protecting them against renters who are [financially challenged] but who meet our criteria.?
Nationally, approximately 40% of renters fail to qualify for their first-choice unit, according to CoSign.
These products are engineered explicitly for rental risk assessment, often considering on-time rent payment history in the evaluation. This factor can better predict eviction risks than a traditional credit score alone.
Landlords examine specific details, such as debt-to-credit ratio, recent delinquencies, bankruptcies and the number of recent credit inquiries, rather than just the three-digit FICO score.
For Los Angeles? multifamily, the market is showing clear signs of cooling. Vacancy rates climbed to 5.2% in Q3 2025, according to Kidder Mathews, the highest level in several years and owners are working harder to maintain occupancy as new supply hits the market.
Source: GlobeSt/ALM