Screening Tenants/My 1st time-Need Help

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Screening Tenants/My 1st time-Need Help

Kimberly H.
Baltimore, MD · Member since 2014 · 146 posts · 63 votes

I have a long story to tell you guys.  I was the person that purchase a baltimore city duplex from FNMA, that had my copper pipes cut a day before closing back in August.  I will document my journey in a few weeks.  It's been so crazy!  Long story and I can't wait to share. 

But, I do need you guys right now.  I have one apartment completed and I've had several showings.  Well, one person actually finished the tenant screening in record time. Lovely family, well manner children, excellent job..... but hear this.  My minimum credit score is 600.  Her's is 556, due to a bankruptcy 3 years ago.  Everything else since then has been just OK.  A few 30/60 days late.  Only on her job for 9 months.  That's when the lates happened.  She meets the income requirements 3x the rent plus she gets child support. What should I do....... see, now I'm getting emotional instead of being smart!

Can I wait to give her an answer until a few more potential renters complete their paper work.  Sad to say, I really like her.  

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Cal C.
Investor · Peachtree Corners, GA · Member since 2014 · 1k+ posts · 1k+ votes
10y

For her I'd say I'd love to rent to you but you have to work on your credit first.  The stricter  you can screen the better you'll be off in the long run. Always remember a marginal tenant who fills this month's vacancy will likely  cost you much more than waiting a month until a better applicant comes along.  Yes, those can be some awfully long weeks in that vacant month but in the long run it will be worth it.  

To put it another way SCREENING IS ABSOLUTELY VITAL TO YOUR LONG TERM SUCCESS!

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  • Mindy JensenPro Member
    BiggerPockets Money Podcast Host · Longmont, CO · Member since 2014 · 7k+ posts · 10k+ votes
    10y

    @Kimberly H., before you ask for a 2 month deposit, make sure your landlord tenant laws allow a 2-month deposit. Some states only allow one month. Become familiar with them, and make sure you have an ironclad lease.

    [email protected]Podcast Guest on Show #261
    BiggerPockets
    1Reply
  • Joel Florek
    Rental Property Investor · Michigan City, IN · Member since 2015 · 530 posts · 741 votes
    10y

    @Kimberly H. One thing you could do is explain that she does not meet the criteria you set for all applicants. However, after confirming with past landlords and references, if you still think she will be a good tenant you could require a co-signer from someone who meets your credit requirements. Typically if someone is really a trustworthy person then someone who they know well be it family or a close friend would be willing to cosign. This is something that is done with all college rentals my friends own. Its a simple way of saying sorry I cant, but here is a solution that could work for both of us.

    Good luck! I bought a 4 unit and placed a couple with a daughter in my unit I just finished renovating in December. Its a great feeling getting to watch a family move into a place you put a lot of work into and seeing them be excited about the next chapter in their lives even if its only planned for 6 months or a year.

    1Reply
  • Kimberly H.
    OP
    Baltimore, MD · Member since 2014 · 146 posts · 63 votes
    10y

    Thanks guys so much for taking the time out to respond and give me so much valuable information.

    I'm going to sit down tonight and do a complete evaluation including property search for the current owner of the property where she's living now and previous.   Most likely I will decline them.  I have 3 additional showings this weekend.  Fingers crossed!  I'll definitely report back. 

    0Reply
  • Jeremiah Stephen
    Background Screener, Real Estate Investor/Agent · Camas, WA. · Member since 2015 · 21 posts · 9 votes
    10y

    Kimberly, Lenzy is right on the money as I am the owner of a CRA Consumer Reporting Agency (check my profile) and using credit is one of the only ways you can legally discriminate against someone however, like Lenzy mentioned, you have to be consistent across the board with your criteria.  So, set your criteria keep it consistent avoid changing the criteria for one person because you like something about them when you just rejected someone with similar results.  This will open the door to problems.

    Jeremiah Stephen

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  • Kimberly H.
    OP
    Baltimore, MD · Member since 2014 · 146 posts · 63 votes
    10y

    Thanks @Jeremiah Stephen  You guys make excellent points if I stick to my criteria then the emotions are automatically put to rest.  I have decided to decline her. Too many red flags and again, I don't want to set myself up for future criminal discrimination issues.  I'm going to do a pre-screening and explain all guidelines up front.  Most will not pay the fee, if they know they don't meet the requirements. 

    Here's a copy of the letter.  Actual I got the sample off of smartmove.  

    ADVERSE ACTION NOTICE

    CONFIDENTIAL – TO BE OPEND BY ADDRESSEE ONLY

    January 14, 2016

    Dear XXXXX

    Thank you for your recent rental application for XXXXXXXXXXXXXX, . After a review of the provided information, we find that we are unable to accept your rental application at this time. Principle reason(s) for denial:

    oTemporary or irregular employment

    oUnable to verify employment

    oUnable to verify income

    oLength of residence

    oDelinquent past or present credit obligations with others

    oNo Credit file

    oDelinquent past or present rental obligations

    oBankruptcy

    oCriminal Record

    oEviction filing or judgment

    oGarnishment, attachment, foreclosure, repossession, collection action, judgment

    This decision was based in whole or in part of the information provided to us in a Consumer Report or Investigative Consumer Report prepared for us by TransUnion Rental Screening Solutions. Their mailing address and phone number are listed below:

    TransUnion Rental Screening Solutions

    (address)c

    TransUnion Rental Screening Solutions plays no part in the decision to take any action on your rental application and is unable to provide you with specific reason(s) for not accepting your application.

    You have the right to a free copy of the report within 60 days of receipt of this notice and to dispute the completeness or accuracy of any information in the consumer report issued by TransUnion Rental Screening Solutions with us.

    Sincerely,

    1Reply
  • Kimberly H.
    OP
    Baltimore, MD · Member since 2014 · 146 posts · 63 votes
    10y

    I actually feel so much relief deciding to move on.  Hopefully I find a good applicant this weekend.  

    Baltimore city is a tough market.  I'm going to stick to my criteria and evaluate more closely.  I understand it might not be cut and dry, but at least if I stick to the "deal breakers" I should be "safer".  Nothing is every 100%. 

    The house is on Auchentoroly Terr/Liberty Heights.  Baltimore is block to block, so it happens to be on a very good block, diverse residents, and the zoo directly across the street. 

    1Reply
  • Account Closed
    Real Estate Professional · Dayton, OH · Member since 2015 · 423 posts · 187 votes
    10y

    Use a professional screening company to do a background check.  You'll find out if she has ever been evicted and if she is a convicted criminal.  A hit on either is an AMF for you.

    If she passes that, look at the way she keep her car.  If her car looks like a dumpster on wheels in the inside, that's how she will keep your property.

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  • Tom Ott
    Equity Raiser and Turnkey Provider · Cleveland, OH · Member since 2016 · 4k+ posts · 1k+ votes
    10y
    Originally posted by @Kimberly H.:

    I actually feel so much relief deciding to move on.  Hopefully I find a good applicant this weekend.  

    Baltimore city is a tough market.  I'm going to stick to my criteria and evaluate more closely.  I understand it might not be cut and dry, but at least if I stick to the "deal breakers" I should be "safer".  Nothing is every 100%. 

    The house is on Auchentoroly Terr/Liberty Heights.  Baltimore is block to block, so it happens to be on a very good block, diverse residents, and the zoo directly across the street. 

     It sounds like you made a smart move! I'm sure you'll find someone right away!

    0Reply
  • Ned CareyPro Member
    Moderator
    Investor · Baltimore, MD · Member since 2008 · 17k+ posts · 13k+ votes
    10y

    @Kimberly H. One thing that I think is important is visit them where they live now. How they keep their current place is is how they will keep your place.

    1Reply
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