Should I Rent to Prospects?

Question

I have a prospect tenant whose father is willing to cosign for her daughter and boyfriend. He agreed to pay $600 towards the rent while his daughter and boyfriend take care of of the balance. The rent is $950 plus $25/per pet per month. They have 2 pets which totals to $1K/month. Should I consider them or move on? I agreed to talk to her father tomorrow to discuss & I want to be prepared.

Side note: the daughter is in school & is a waitress while the boyfriend is in construction and in school.

Side note: the daughter is in school & is a waitress while the boyfriend is in construction and in school.

Lynn McGeein · Answer

Personally, unless the father was extremely over-qualified and happy to cosign for the entire amount and be responsible for damages, plus you receive the max deposit allowed as odds aren't good that the pets will be very supervised with 2 people both working and going to school, I would pass.   My daughter was a student and a server, and there is no way I would have cosigned for her if she had a pet as she had no time between school and work to take care of it.   It's a recipe for disaster, especially if the dad is already trying to manipulate you, using his lawyer for favorable lease terms and limiting his responsibility.  When I agreed to cosign, it was only because both parents were required to cosign, responsible for each daughter's portion only, and when the roommate relationship went bad, the landlord let my daughter and me out of the lease when we found another roommate with a parent cosigner to finish out the lease.   That scenario made more sense, but not with pets involved.

Randy E. · Answer

I probably wouldn't rent to them, because I can't verify they make enough to meet my income threshold and the father won't be a full-cosigner.

However, I like Marcia's idea of an increased security deposit to mitigate any money problems.  Just remember, you'll have to stay on top of the situation.  If they ever fall behind on the rent, initiate eviction proceedings promptly.  If you wait because you feel the extra security deposit will cover the late rent, you'll take a chance on losing money to property damage.

Also, don't forget to collect extra security deposit for the pets.  Two pets can cause a lot of damage when left alone for most of the day.  And it sounds like with the jobs and classes that the pets will be left alone for most of the day.

Good luck.

Colleen F. · Answer

The reality of this is that this is essential going to be a student rental with co-signer and pets.  They really want this place because you posted before he would not co-sign.   Does the boyfriend have any parents or is he older?  I usually have cosigners for each occupant for young students who are not self supporting.  The lawyer drawing it up seems to be misplaced spending but that is his option.  What is the current situation, are they already in a place and why do they have to move?  Do you have good references and have you seen that place.  (where the dogs also live).

In the end if they default on the lease you won't probably get anything from anybody so I agree with @Marcia Maynard if you state law allows take a higher security deposit.  If not accept the co-signer ONLY if the previous occupancy looks good.  You could consider month to month or shorter trial term. I suspect dad wants to impress upon them that they have an obligation to pay this rent.  I usually don't allow pets for students but have when the students are self-supporting and have been on there own ( been there) I have.

Marcia Maynard · Answer

@Ayodeji Kuponiyi The purpose of a co-signer is to mitigate your risk, all of your risk. That means beyond $600 portion of rent that the dad said he'd pay. Suppose they are in default more than one month, or perhaps they cause significant damage to the property? Gets complicated. We have never gone the co-sginer route. Instead, if we decide to rent to someone but they pose a higher risk to us, we just require additional security deposit. Depending on landlord-tenant law for your jurisdiction this may or may not be an option for you. If it were I, I would ask for additional security deposit to cover your additional risk.... such as $1200... totally refundable if the tenants don't default. Less risky for dad and actually more secure for you.

I would be more worried about accepting the pets. Check them out carefully and make sure the tenants can demonstrate they are responsible pet owners. Get a pet agreement in place that covers their additional responsibilities.

Also, be prepared if the GF and BF should break up. I would do a MTM rental agreement and not a long term lease. Easier to work with if things so south.

I would be more worried about accepting the pets. Check them out carefully and make sure the tenants can demonstrate they are responsible pet owners. Get a pet agreement in place that covers their additional responsibilities.

Also, be prepared if the GF and BF should break up. I would do a MTM rental agreement and not a long term lease. Easier to work with if things so south.

Ayodeji Kuponiyi · Answer

@Don Glasgow thanks for the advice. We'll lower it if we don't get enough response. I agree with you, vacancy > bad tenant

Don Glasgow · Answer

If you allow the prospective tenants to rent from you I am 95% certain that you will regret it.

So many red flags.

Better to leave a property empty than put a bad tenant into it.

If you can't find a good tenant then your price is too high. Lower your asking price to the point where you have several potentials to rent to.

Don - owner of a 10 year old property management company, managing 140 doors.

Stephen E. · Answer

The tenant's cosigner drafting a lease is toxic. There are enough signals here that these people will be trouble that I would move on. There are other tenants out there that do not come with cosigners who want to dictate terms to you. You have to demonstrate the necessary resolve to move on.

Steve Babiak · Answer

OK, this was posted about the same time as my previous post, and so I missed it earlier.

The tenant having an attorney draft your residential rental documents will almost certainly turn out bad - FOR YOU. In the commercial space, that might be the way it's done, but never have I had that in a residential unit. Expect the documents to be one-sided to favor the tenant, with lots of loopholes allowing the tenant to escape unscathed.

I can't even believe that you even gave these prospects suspects an opportunity to be considered for this unit. Don't waste too much of your time with this sort of tenant applicant, unless you have reached the point of desperation to fill a unit. And even then, you can resort to other alternatives that might not backfire as badly on you.

Ben Parr · Answer

Short Answer: No!

Long Answer:

I probably would not rent to them, but it would depend on the response to your property listing. If it's been available for 2 months and no one else is interested or qualified (and your price is not too high for the market) I might reconsider. I would never allow a tenant to create the lease document either, though again if it's been hard to find people I MIGHT allow them to add 1 clause.

This assumes that with both of them working that they don't meet your minimum income standards (Mine is 3x with 4x preferred) If they do meet your income standards on their own and the dad is willing to guarantee part of the rent then that is just an extra bonus.

I also second the higher security deposit. In Michigan where I operate I've been told the max security deposit we can charge is 1.5x the monthly rental rate (check with your lawyer, I'm not one) and the market is good enough in my area that I always charge the maximum amount.

Should I Rent to Prospects?

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