Sometimes, things can go south when you need to take up a commercial lease, but you discover that your credit score is bad. There is an unfortunate stereotype about people with a bad credit score as they are seen to be a typical bad guy, starved off trustworthiness.
Yet, in reality, a bad credit score can occur to just anyone. Bad credit essentially means a financial history of your inability to pay up loans when you were obligated to.
Worry not, for in this guide, we will show you how to secure your dream commercial lease, even in the face of bad credit.
1. Do a wide search of your options:
Honesty is quite needed here, and you have to search for all the options open to you. Your real estate advisor or lawyer can help you do it, but you need to be honest about the reasons why you were unable to meet the previous financial commitments so that they have adequate information to help you.
When you know you have several options, you will be more relaxed to seek out a property owner who can accommodate your bad credit.
2. Get a good guarantor or co-signer:
If, for instance, you’re considering getting an office space for lease Seattle with bad credit, getting a guarantor or co-signer with a high credit score to sign as a surety for you can help you secure the commercial lease.
The property owner would know that he or she would have nothing to lose as your guarantor or co-signer will be held liable to pay if you default.
Admittedly, since your credit is bad, it could be hard to get a guarantor, in which case, look for a family member or friend whom you would be willing to offer a percentage of the business proceeds, making the deal more lucrative and mutually beneficial.
3. Be willing to stake high:
Negotiations for an office space for lease Seattle with bad credit could be quite tricky, but you can still get a fair deal. You would have to increase your stakes to make your offer attractive, despite your low credit score.
You can offer to make a hefty security deposit, add collateral, or even agree to pay a higher interest rate. A business-minded property owner would be more interested in offering you a lease with such these attractive conditions.
4. Consider bartering:
Bartering means exchanging what you have for something that you need. Identify a connection between your line of business and what the property owner can get in place of the payment and have the willingness to exchange, even if you’re a bit on the losing side.
If finding a connection is difficult, you can join a barter club where the credit scores of the members can be used towards your lease.
5. Go for a motivated property owner:
Property owners can sometimes be motivated to advertise that they are willing to bargain or offer leases to people with bad credit. Search out for them and be prepared to commit to their terms, giving assurance that you will keep to the lease agreement.
When you need a commercial lease, and you have a bad credit score, you don’t have to panic. There are some things that you can do to rectify the situation. The bottom line is that whatever arrangement you decide to use, you have to document and sign it to protect yourself in the future.