Getting Rent One Year In Advance

5 Replies

I just rented a home to a tenant who did not quite meet my income requirements.  I expressed my concern to her and she said she had $20,000 in savings and could get me a letter from the state where she gets just under $3,000 per month in a pension.

I suggested to her that if she paid her rent a full year in advance I would lower the monthly rental fro $1,100 to $1,000 per month.  She attempted to get me to go down to $950 and take care of the lawn but I stood with my original offer.  

Do you think that is a good idea to give up that kind of income to get paid one year in advance?  No criminal record and a credit score of just under $700.  No prior landlord for a reference but came referred by a friend of mine.

Did you establish your rental criteria prior to making the unit available to rent? If so, follow your rental criteria. If not, take a look at ours and borrow some ideas from it. We uploaded both our Rental Criteria and Tenant Screening Questions into the BP File Place. Go to the Resources Tab: File Place: Other Documents and look for those. You can modify them to meet your needs.

We use month-to-month (MTM) rental agreements and prefer to collect the rent monthly, so if there is a need to change the terms of the rental agreement or to remove a tenant, it is easier to do so. You may be able to collect a higher security deposit when taking on extra risk instead of extra pre-paid rent. However different states have different laws, so check the landlord-tenant law for your jurisdiction.

Also, if she is receiving a state pension of close to $3000 a month, that can be easily verified. From what you shared, she does not seem to be a high risk. Make it easier for her and easier on yourself by not setting the bar so high that you can not accommodate this type of scenario.

Marcia Maynard, Fischer Properties | Podcast Guest on Show #83

My criteria is $3,500 monthly gross income so she was close.  I also do credit and criminal back ground checks as well.  She has no criminal background and a credit score of 683 with a good track record of making payments.

I typically require at least two landlord references but will cave on this with the right prospect.  In this case she had lived elsewhere for the past 12 years so I could not do a landlord check.   She did come referred by someone I trust and I have met her several times.  Each time she beat me to our appointed time, and I am seldom if ever late.  We don't allow pets, smokers or more than 4 people in the house.  She complies with all of the requirements and will be the only one living there. 

I never considered there might be a state law against paying rent in advance so I will check on that.  I also will review your requirements for any additional ideas.

My question was more about whether or not others felt I may be giving too much away ($100 per month off of rent that is typically $1,100 per month).  I feel pretty secure that she will be a solid tenant.

Sounds like you have a pretty qualified tenant here who came to you as a personal referral from someone you trust a lot.  The only issue seems to be the income and you do not seemed alarmed that she will not be able to pay.

Why don't you just take 2 months security instead of a whole year in advance and keep the rent at $1100?  Another thing we do is we write in the lease that the tenant will have a debit/credit card on file with us that we will run for the rent payment on the first Friday of each month.  Something you might want to consider if you have the ability to take electronic payments.  

Medium rzt hc 6483Michael Noto, SalCal Real Estate Connections | [email protected] | 860‑384‑7570 | https://www.zillow.com/profile/Mike-Noto/

I doubt I would offer much more than a token discount - $25. a month or something.  Because it's not like I really Get anything - as she was going to pay the rent anyway.  Right? <g>

Also;  I would want the year's pre-paid rent in the form of 12 rent checks - each one dated for the due date for each sequential month.  

BTW:  The only legal way to do this is to have the maker of the check write the words:  "Void Until" above the date they write on the check.

stephen
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 Originally posted by @Niles Crum :

I just rented a home to a tenant who did not quite meet my income requirements.  I expressed my concern to her and she said she had $20,000 in savings and could get me a letter from the state where she gets just under $3,000 per month in a pension.

I suggested to her that if she paid her rent a full year in advance I would lower the monthly rental fro $1,100 to $1,000 per month.  She attempted to get me to go down to $950 and take care of the lawn but I stood with my original offer.  

Do you think that is a good idea to give up that kind of income to get paid one year in advance?  No criminal record and a credit score of just under $700.  No prior landlord for a reference but came referred by a friend of mine.

I wouldn't offer a discount at all.  You're already making an accommodation by renting to her with no references and lower income than your normal criteria.