Should I rent to tenant with 540 credit score

[Bill Briscoe]

I have 1 property which rents for an above avg $1275/mo, SFH, tenant pays all utilities, yardcare, etc. We did a full reno 3+ years ago and have a mtg so cash flow is only about $450/mo.

So far we have had 3 tenants - all of which have been very responsible and had credit scores over 700.  Now it is vacant again and our only applicant in 6 weeks has been a single mom, 2 older kids, recently divorced, and with a credit score of 540.  Income is $50K so she makes the 3x ratios barely, but that comes from 2 jobs, the 2nd of which is a newly opened bar so she only has 1 paystub year-to-date.  The other job is leasing manager at her current apartment.  She pays that rent "on time" but it is a payroll deduct, so it would be hard/impossible to pay it late.

She is very interested, and paid the $39 background fee check, so I want to work with her, but don't want to take on a completely stupid risk. Thoughts on this one? 

Would you approve her?

Ask about a co-signer?

Deny application initially but offer approval with deposit plus 2 months rent up front?

Something else?

[Jeff B.]

1) verify all income AND employment

2) pull a full credit report and look at 30,60,90 day lates;  verify there's NONE in the last 6 months.

3) how many and what kind of collections are on the account?

Life gets messy and the FICO means JACK as to what kind of person she is and her level responsibility.  The fico of 700 for the others has nothing to do with her 5xx.

Question is: what could/can she change vs how has she been reacting to circumstances?

Being thorough and careful, you can get a loyal and reliable tenant.