I live in a high rental area in miami. I have a very nice 3/1 newly renovated in a up and coming area. I have the house listed for 1600 a month. I have a intrested. Party that has not argued the rent but I just got her application back, she has a va disability payment of 2400 and makes 900 a month at work. Credit score is 650. I'm thinking she can't afford the rent, she wants to sign a two year lease. I'm still new at tennat screening so all input is appreciated and any advice on how to explain that I require a higher income /cost ratio.
To me it matters more how much debt they are carrying around. I'd rather take a tenant that doesn't borrow much money at all with a lower income then someone who has a ton of debt and makes a higher salary. I find that hose who carry a lot of debt don't live within their means. Pull their credit report.
To me it matters more how much debt they are carrying around. I'd rather take a tenant that doesn't borrow much money at all with a lower income then someone who has a ton of debt and makes a higher salary. I find that hose who carry a lot of debt don't live within their means. Pull their credit report.
I am a Realtor/Investor in your area and if I may can I add some input.
Credit is good/decent considering the current rental market.
Have you completed a background check?
Verified her employment?
In the state of Florida only ANNUAL leases are permitted. **
Last if you were my client I would say that she cannot afford the monthly payment. Why?
Her income is less than 2.5 X the monthly rent of $1,600 which= $4,000.
3X would be $4,800
Your prospective tenant's total income is only $3,300. I've learned if they start out struggling they'll always struggle and never be able to catch up. Just my two cents.
If I may be so bold, I think you're looking at this backwards. If you have a tenant making less than 3X the rent in gross income (yours is closer to 2x), I think your default approach needs to be to pass.
With that said, I think that you should be open to being talked into taking them on. Do they have 20K sitting in a checking account? Do they have a strong rental history? Do they have a 720 credit score (i realize these tenants don't). If the applicant could show financial strength in another area, I could overlook a 2x monthly income. But outside of those special circumstances - I wish them luck, waive their application fee, and move on.
Is this just one person that will be living there? If that is the case, I would take 2x the rent in income. She doesn't have a family to support, so she may be fine. I would definitely look at her credit before making the final decision though.
Is this just one person that will be living there? If that is the case, I would take 2x the rent in income. She doesn't have a family to support, so she may be fine. I would definitely look at her credit before making the final decision though.
If I set my screening criteria to 3x rent for couples and only 2x rent for single people, I might get sued for discrimination based on familial status.
Prospective Tennant is single mother with 2 teenage boys. Credit history is shakey and little money reserved. Also the rental historythat I have her last 3 places shows no long term payment history.
Seems I'm gonna have to pass on this one. Its too bad she's very nice, well dressed obviously ex army, just no income. I
@Brad Tamm you have answered your own question. Gross income 3x rent is the gold standard as many have indicated; this tenant clearly does not qualify based on this measure alone. You now add that credit is shaky and she lacks savings to deal with any cash flow shocks. What this means is that if any major and unexpected financial matter comes up her financial reserve will be to stiff you on the rent. No long term payment history from the last three places suggests rapid moves between addresses. There are many red flags about this tenant but the good news is that there are other tenants who are just as nice, well dressed, even ex army, who have three times income and good credit. Your mission should you choose to accept it is to go out and find one of these tenants.
Yes, pass. And Brad, best to learn the lesson now that "nice" doesn't negate negative paperwork. "Nice" can enhance an already good application, but never make your decision to overlook bad paperwork because someone is "nice". Trust me on this one. You'll get burned. Set criteria and stick to it as closely as possible and you'll be better off in the long run.