It is almost unanimously agreed that a landlord has the right to do a background check for potential tenants, which can include credit checks. Because credit worthiness can be a selection criteria for prospective tenants, landlords are free to reject an applicant if they do not meet a certain standard. Landlords can even reject an applicant who is receiving federal or local housing assistance on the basis of bad credit. The only limitation is that landlords cannot use credit worthiness as a pretext to discriminate against the poor or recipients of federal or local housing assistance.
If you are purchasing a home, bad credit is not usually an issue for the seller because banks, mortgage companies, and escrow agencies stand in to supply the money in question. There are some instances when a person with bad credit can be liable to the seller of a home, such as fraudulently misrepresenting a credit score. In some cases the seller of a home will be entitled to rescind a purchase and sale agreement, and may even be able to sue for any damages resulting therefrom.
The most obvious impact bad credit will have on getting housing is through financing. Almost any lender, bank, or mortgage company will demand a credit report before they give you a loan, or a mortgage, to purchase a home. Generally speaking, these companies broad latitude to reject your application for a loan based on your credit score.
It is highly recommended for you to find a real estate, property, or credit attorney if you have bad credit and are trying to find housing, or feel you have been unfairly denied housing based on your credit. Only an attorney will properly be able to explain the relevant issues and help defend your rights.