Standards when screening tenants

[Kenzie McIlvoy]

We are under contract for our first live-in-flip and will be using our current house as our first rental. We are going through the process of screening tenants and have had several people apply. Our current standards for tenants is 3x the monthly rent in monthly income, credit score of 600 or higher, no evictions or criminal history and good rental history.

We have someone we’ve been talking with that makes 2.1x in monthly rent but will have a part time job and child support that push her into the 3x category. Their credit score is 508 and has a bankruptcy listed. They are able to get a co-signer with a higher credit score.

This will be our first tenant and I think we’re just trying to get over having to say “no.” Any tips on mindset or standards for yourself when screening through tenants? If someone in their position can do everything to meet our minimum standards how do you still say no and be respectful? We’re trying our best to be respectful to people and also stay out of a lawsuit. Thank you! 

[Nathan Gesner]

It doesn't make sense to set standards and then deviate from them the with the first person that comes along. Your standards are very reasonable; stick with them.

Come up with a generic, friendly, professional denial letter.

"I'm sorry, but your application does not meet our standards. We wish you the best in your search for housing."

I recommend you don't try to justify the denial. Don't apologize because that implies you may have done something wrong. The only time you must give a reason is when the rejection is based on their credit report. In those cases, you should issue them an Adverse Action Letter. If your screening software doesn't provide one for you, then you should be able to find one with a Google search.