WASHINGTON — At 25, Representative-elect Maxwell Frost will be youngest member of Congress. He’s also in debt, after maxing out credit cards to win Florida’s 10th Congressional District seat.
He said he was upfront about his bad credit when he applied for a one-bedroom apartment in Washington, D.C., where he now has to live part-time for at least the next two years. A broker, he said, told him that was fine. He paid a $50 application fee and then was denied the apartment because of his poor credit history.
Mr. Frost, the first Gen Zer elected to Congress and a Democrat, took to Twitter in early December to voice his frustration: “This ain’t meant for people who don’t already have money.”
While most other Gen Zers haven’t accrued campaign debt, Mr. Frost’s housing woes have generated a wide range of commiserating among Gen Z Twitter users who have short credit histories and less capital to afford expensive deposits and application fees.
Mr. Frost said he also lost hundreds of dollars last year when he was searching for housing in his home district in Orlando.
“Application fees are becoming a source of revenue for management companies,” Mr. Frost said in an interview. “We live in a world right now where you can run an extensive background check for $15, why are fees up to $200? Why do we use a credit score to determine if an applicant can pay rent when there’s so many things that hurt someone’s credit score?”
The fees are the sour cherry on top of a brutal housing market: Last month, the typical asking rent in the United States was over $2,000, up from $1,850 in November 2021 and $1,600 in November 2020, according to data from Zillow. For Washington D.C., the typical asking rent was over $2,200 last month, a figure that’s been following the national trajectory.
Some Gen Zers see no feasible way to get a place of their own: Nearly a third of people between the ages of 18 and 25 are living at home permanently, one recent report found.
Raegan Loheide, 25, started looking for a new apartment with their partner and their current roommate last May. Mx. Loheide, a barista, was living in an apartment in Queens, but said their mental and physical health was deteriorating from a series of maintenance issues that their landlord refused to fix, including a roach infestation, holes in the ceiling, a lack of heat and a broken toilet.
“We didn’t feel safe,” Mx. Loheide said.
But in the months following, Mx. Loheide, their roommate and their partner applied to five apartments — spending hundreds of dollars on application fees — all of which they were rejected from.
“The first rejection was because we didn’t have a third guarantor,” Mx. Loheide said. “I kept asking the brokers ‘why?’ but I barely ever got a real answer.”
Eventually, Mx. Loheide felt they had no choice but to stay in their current apartment, even if it meant an emotional toll and more landlord troubles.
“We couldn’t move,” Mx. Loheide said. “We kept expanding our budgets and scraping together more to afford to relocate, but what good is that if we can’t even get approved?”
Why Landlords Care About Your Credit
Credit is one of the tools property owners have to utilize to tell upfront if a tenant will be able to make their rent payments, said Jay Martin, the executive director of the Community Housing Improvement Program, a trade association for 4,000 property managers and owners in New York.
“Property owners have a fiduciary duty to figure out that the applicants that they’re screening are going to be able to pay the rent that they are applying for, because they have mortgages that they’ll have to pay with the rent money that they are collecting,” Mr. Martin said.
Mr. Martin added that the money from application fees “is not in any way a form of revenue for management companies, brokers or property owners.” The fee, Mr. Martin said, goes toward covering the cost of running the background checks, credit checks and other screening processes.
Still, some tactics and motives have drawn criticism.
Brokers also may encourage people who will likely get denied from an apartment application to apply anyway, for financial incentives or in hopes of raising their statistics on how many applicants they can bring in,said Felipe Ernst, a faculty member in Georgetown’s masters of real estate program and founder of a D.C.-based real estate development firm.
While it can create more competition for an apartment and give a landlord more options to choose from, it can negatively impact potential renters who are already struggling since application fees, which can add up to hundreds of dollars, are almost always nonrefundable, he said.
“Its borderline unethical to put someone in the ringer, knowing that they won’t get approved,” Mr. Ernst said. “But at the same time, you need to have a realistic look on your finances. I don’t go to a Ferrari dealership if I can only buy a Honda.”
Settling for a Room or a Couch
For people desperate to rent apartments, they are just searching high and low for somewhere to live.
In 2018, Vipassana Vijayarangan had to move to D.C. on short notice for a new job. She stayed in an Airbnb until she had pay stubs for a rental application, and with her partner, she found a suitable two-bedroom apartment to apply to in Washington’s Capitol Hill neighborhood.
“I told the agent in an email, ‘I’m very interested in this apartment, but I do not have any credit,’” Ms. Vijayarangan, 31, said. “When I lived in the U.S. on a student visa, I didn’t have — and was not allowed — to get a social security card. So it was impossible for me to even apply for the secured version of a credit card until I had work authorization.”
Similar to Mr. Frost’s situation, the broker assured Ms. Vijayarangan that her lack of credit wouldn’t be a problem, but in the end, her application was denied.
Ms. Vijayarangan, who now works as a data scientist in New York, eventually rented a room in a rowhouse from an immigrant landlord who understood her situation, she said. But, Ms. Vijayarangan and her partner, an American citizen who had a more established credit history, ended up living apart because he could get approved but she could not. “That could have been the first time that we were living together and building a life together,” she said. “We didn’t get to do that.”
Mr. Frost is now the proxy for discouraged Gen Zers, but he is just the latest in the storied tradition of members of congress lamenting the process of finding a secondary residence in D.C. after being elected. Through the years, representatives and senators have opted to split a place with one another or even sleep in their offices to save money.
In an interview last week, Representative Alexandria Ocasio-Cortez, Democrat of New York, said that she has previously “dealt with very similar issues.”
In 2018, just after she was first elected and was set to be the youngest woman to serve in Congress, she told The Times, “I have three months without a salary before I’m a member of Congress. So, how do I get an apartment? Those little things are very real.”
Similarly, Representative Mondaire Jones, Democrat of New York, said he also ran up debt when he first ran for office.
“This place is not set up for people who are not independently wealthy,” Mr. Jones said. “People here don’t understand wealth inequality because they’ve not experienced it.”
Mr. Frost has a budget of less than $2,000 a month. He’s looking for a studio apartment within walking distance of the U.S. Capitol since he does not intend to have a car or a driver to chauffeur him. His geographic hopes have restricted his apartment hunt to a few gentrifying neighborhoods.
Unsure when he’ll finally secure a place to live, he plans to continue couch surfing for a few months to save money and find an apartment in one of his desired neighborhoods.
“I was very close to taking out a loan, which would mean spending a lot of personal money to pay back the loan,” Mr. Frost said. “Rent problems are not just mine. There are millions of Americans that have these same problems.”