Tenant "grading"?

5 Replies

I've seen a lot of discussion on the forums about property grading, meaning what an "A" property is, what a "B" property is, etc.

But what about tenants?

What would an "A" tenant mean to you, what about a "B" tenant, a "C" tenant, and a "D" tenant?

I would imagine that an "A" tenant generally wants to live in an "A" property, and likewise for all the grades, but do you ever have a tenant class live in a different property class and have it work?

I think there can be "A" class tenants in all types of neighborhoods and income brackets. Money doesn't buy class. Grant it you tend to have a tougher time with tenants in worse areas.

I would class them this way:

A= great credit, work history, rental history
B= ok credit, work history and good rental history
C= bad credit, insufficient income, evictions
D= never entering my rental property

I just sort tenants into 3 categories - quality , marginal and toxic. As to their distinctions,its self explanatory.

"A" Tenant = Professionals with good credit, pays on time and takes care of the place. They could clearly be homeowners but they just decide to rent.

"B" Tenant = Decent Credit, Pays on time most of the time, doesn't completely destroy the house

"C" Tenant = Bumpy Credit, When rent is due you're biting your nails wondering if the payment is coming, you have to occasionally keep them in line and they require more interaction

"D" Tenant = No thanks......

An "A" tenant for me would have good credit, earn at least 4x monthly rent, no evictions, good rental history. I could dream :)  An "A" tenant may not make enough money to afford an "A" class rental property though...

A tenants improve the property ; landscaping g for example ; offer to build out your basement and charge you only materials ; change out amenities on their dime (nicer appliances ; granite ; etc

I have had tenants do all of these things and it has been awesome - these tenants also stay long term :)

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