Real Estate Investor · Baltimore, MD · Member since 2008 · 1k+ posts · 268 votes
Just spoke to a person (who BTW tried to downplay our property right away (it's been on the market for so long (1 week)!!! and we're never gonna find people with good credit who will pay this much!!!)) who advised that their credit was pulled earlier this month (on the 2nd), implying that I won't to worry about pulling credit.
I didn't get into this "credit pulled already" issue cause I had to say they will not qualify based on credit alone (she told me the score is 500).
But anyway, my gut feeling is - they apply a lot and get rejected a lot and are trying to save on application fee.
What's your reaction to this ?
The "already pulled credit" may or may not bear significance, some people just don't think things through regarding different property managers and application fees, etc.. However, the downplaying your property right off the bat throws up a big red flag for me. It sets the tone for the rest of your relationship as landlord/tenant, which based on that conversation, I would not want the relationship to continue any further.
I had one where they had their credit pulled to buy a car, so they didn't want me pulling credit. I said: "you are willing to give your credit report for a $20 to $30K thing, but you won't allow it for a house that is far more valuable than that?" They still refused, and so did I :D
Do not rely on any credit report that came from other than your trusted screening provider. Too easy these days to scan it in and clean it up before printing that "copy".
If they are seeing lots of rejections then they have to go looking for somebody who is advertising that they won't pull credit, or go to somebody too stupid to get the credit reports. That's their problem, not your problem IMO.
The "already pulled credit" may or may not bear significance, some people just don't think things through regarding different property managers and application fees, etc.. However, the downplaying your property right off the bat throws up a big red flag for me. It sets the tone for the rest of your relationship as landlord/tenant, which based on that conversation, I would not want the relationship to continue any further.
The "already pulled credit" may or may not bear significance, some people just don't think things through regarding different property managers and application fees, etc.. However, the downplaying your property right off the bat throws up a big red flag for me. It sets the tone for the rest of your relationship as landlord/tenant, which based on that conversation, I would not want the relationship to continue any further.
FICO says consumers in ... score range of 750-799 have a delinquency rate of 2 percent. But FICO scores below 500 have an 83 percent default rate, 500-529 shows a 72 percent delinquency rate, in the 550-599 range there is a 52 percent probability of delinquency, 600-649 scores show a 31 percent delinquency rate, and 650-699 have a 15 percent delinquency rate. Over 700 the delinquency rate drops to 5 percent up to 749. If your FICO score is 800 or over, you have a 1 percent delinquency likelihood.
The credit score shouldn't drop if it is pulled again, but it is a red flag if they are already been differ cult what are they hiding? 500 is horrible stay away!!
They probably do apply a lot and get rejected a lot with that score.
They may be trying to see what you will say when they tell you their score is 500. If you're not going to rent to them because of that, then there's no need to apply and waste their money. The score is still 500 and it doesn't meet your requirements.
It makes sense for everybody.
When people tell me their score is 500 from a recent credit pull, I tell them I cannot get them a mortgage. No need to pull credit unless they want to get involved with credit repair.
No need for the comment about your property though.
For those of you who use the credit score, do you cut it off at an arbitrary number? How do you comply with fair housing rules when using the credit score, or set your criteria so that everyone is treated the same? thanks
Do not rely on any credit report that came from other than your trusted screening provider. Too easy these days to scan it in and clean it up before printing that "copy".
I've heard NEVER accept a credit report the applicant provides for that very reason, too easy to forge.
However, I have heard some applicants, who already pulled their own credit report and score, provide their log-in info to a LL so he/she can check their already paid for credit report online (practically impossible to fake).
Anybody run through this scenario before???
BTW, with all the SS's and other nonsense going on, a credit score in the 500's isn't as big a red flag as it used to be. Last year, I evicted a guy with a 700+ credit score and replaced him with model tenants who had a score in the mid 500's. There is much more to look at than simply a 3-digit number.
Do not rely on any credit report that came from other than your trusted screening provider. Too easy these days to scan it in and clean it up before printing that "copy".
It's even easier than that Mitch.
There is a line of code that can be inserted in the address bar of any web page and it allows you to change anything on the page (text, graphics) and then print it. I use it a lot for web site development, but lots of people are using it for deception. People use it to change credit. And the internet gurus use this tool to recreate their paypal accounts to make it look like they have made billions of dollars to entice you to buy their products. The thieves are always ahead of the game.
I always pull a new credit report on the applicants. As others have said it's too easy to fabricate.
As for the score, here are some examples I have had recently:
App # 1: Score 673, No late pays, too many inquiries. But the court records show 7 evictions filed in the last 4 years. I confirmed this with the previous LLs and court records. Lied through out the application.
App # 2: Score 476, Late pays, collections, and a bankruptcy.
App # 3. Score 540, Late pays (revolving), too many inquiries. No evictions filed. Current and previous LL stated that the rent was always paid on time. Everything checked out on the app including all the names, addresses, and phone numbers. I may frame it.
Sometimes you have to look at the person and make a gut call based on what their situation is and their priorities are (Like paying the rent on time).