Finance category
Mortgage, loan, investing, tax, and money calculators.
Renter Default Probability Calculator
Renters default at different rates. This calculator estimates probability from credit and income.
Default probability %
2.90%
Risk tier
Standard
Suggested security
1.5 months + last month
How the math works
Probability blends credit, income, tenure, references. Lower score = lower default risk.
Application scoring protects portfolio-wide collections. A 1% reduction in default rate on 500 units at $1500/mo saves ~$90k annually in bad debt + collection cost. Worth tight scoring.
How to Use
- Enter credit score.
- Enter income-to-rent ratio.
- Enter months at employer.
- Enter prior landlord references.
- Read default probability.
Frequently Asked Questions
Rent-to-income rule?
3x monthly rent as minimum gross income standard. Below 2.5x elevates default risk sharply. Above 3.5x effectively eliminates default risk for most markets.
Credit cutoff?
Most landlords require 620+. High-demand markets allow 580+ with extra deposit/guarantor. Below 580 requires strong other signals (long tenure, PG, high deposit).
Employment tenure?
12+ months current employer = positive. 3-12 months = neutral. Under 3 months or pattern of short stays = elevated risk. Self-employed: require tax returns plus bank statements.
How often should I rerun this?
Rerun this calculator whenever inputs change materially — new rent roll data, rate moves, loan balance updates, or quarterly operating data. For active deals, monthly refresh is typical. For stabilized assets under monitoring, quarterly is fine. Treat the output as a decision tool, not a one-time answer — market conditions evolve and so should your analysis.
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