Do you grant first come priority for applicants?

Investor · Québec, Québec · Member since 2016 · 33 posts · 13 votes

I have a unit for rent and two days ago I showed It to a young man who will probably meet my minimal standards (screening process is in process). I also got a visit yesterday, an older man who is looking for an apartment for as long as he could live by himself.

Short story short, with the info I have, the young will probably rent for two years max, and the older one may rent to the day he die (he's around 65).

Given that they both meet my minimal requirements, who would you rent to and why?

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Amy Beth

Rental Property Investor · Edison, NJ · Member since 2016 · 753 posts · 565 votes

We select the best candidate which is not always the first applicant.

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Peter MckernanBusiness Member
Residential Real Estate Agent · Irvine, CA · Member since 2013 · 2k+ posts · 1k+ votes
9y
@Samuel Lacroix
You should always set a standard and stick to it. For example, if one credit score is 640 and the other is 655; your standard is 650 minimum. This would be placed into your standards, so that if someone were to come back after a year, or come back after a month accusing you of discrimination, or being unfair you have a solid argument that is a basis that you use every single time. That would keep you out of hot water. There should be multiple standards set in place just in case you don’t run into two applicants that have the same exact credit score, you will have another layer of qualification one may not hit.
It does not matter if you take the first to apply or the 31st person that applies, it matters that you are consistent with screening.
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Thomas S.
Member since 2016 · 13k+ posts · 12k+ votes
9y
As stated impose strict screening standards and stick to them. I would continue to take applications so that you have a larger pool to choose from if you feel there will be more coming. There is no reason to settle and it is always better to have a vacancy that to choose a applicant out of desperation.
In the case of the older applicant if you believe he will stay a long time make sure he is the perfect candidate. Mediocre tenants are a pain and unfortunately most landlords once they get a tenant are adverse to terminating them.
Best policy is to only offer M2M automatic renewal lease with the option for both parties to terminate/non renew with 30-60 days notice.
In your case neither of your applicants seem to be the best choice so you need to keep looking.
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Samuel Lacroix
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Investor · Québec, Québec · Member since 2016 · 33 posts · 13 votes
9y
@Peter Mckernan
Yes indeed I have set standards, which, for now, is
- Credit score 600+
- Revenus ≧ 3x rent
- Good feedback from previous landlord
- No recourse against them
I would accept an applicant with a credit score sub 600 for lack of credit history and/or first time renter (non landlord feedback) if they have an endorser who meet the requirement.
Like I said, screening process is in process for both of them, but there's a good chance they'll meet all the requirement :/ Of course I would like to rent to the second one because he want to stay a long time. But I would feel unfair to the first one.
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Samuel Lacroix
OP
Investor · Québec, Québec · Member since 2016 · 33 posts · 13 votes
9y
In fact, unless screening process says otherwise, they both seems promising. The only difference being that the older may stay longer in place, which is something I seek.
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Robert Melcher
Residential Real Estate Broker · San Antonio, TX · Member since 2016 · 506 posts · 311 votes
9y
As a PM, if we get more than one qualified applicant for a property, we present both to the landlord for the ultimate decision.
We do have published criteria, and a policy of keeping a qualified applicant for presentation to another landlord if they are declined for the preferred property. Applications are good for 30 days for any other property we manage, and we do advise that there is no first-come-fist-served basis for decisions when more than one person applies.
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Justin Fox
Software Developer · Vidor, TX · Member since 2015 · 922 posts · 639 votes
9y
I think every one of my tenants so far has had a credit score sub 600. All pay on time and aren't problems. I would leave credit score out and use evaluations of the credit history instead (delinquencies on mortgages, car notes and etc.) I typically ignore student loan and/or medical late payments.
As long as they aren't delinquent a lot, can afford the place (with verifiable income), have good landlord reference(s) (aren't needy, paid on time, or paid late fees if they were late and didn't destroy the property) and don't have any evictions, then they're good.
If the first guy qualifies, let him know, set up a date to get the lease signed and then mail the old guy his fee back since you didn't process it.
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Thomas S.
Member since 2016 · 13k+ posts · 12k+ votes
9y
Unless your property is in a C class neighbourhood your credit score standard is far too low at 600-649 there is a 23% chance of your tenant defaulting. You need to raise your standards to a minimum 650. When reviewing the credit history take all debts into consideration, ability to pay and for you to collect if they default is dependant on all their debts including student and medical. If they can not or do not pay debt is debt and you do not want to be last in line to collect.
I always tell my tenants I expect the rent to be paid ahead of car repairs, utilities, medical and food.
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Samuel Lacroix
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Investor · Québec, Québec · Member since 2016 · 33 posts · 13 votes
9y
@Justin Fox Intersting thought about credit score. I didn't screened a lot of tenants so far in my REI life (aroung 15), but maybe It's because everyone I screened that was sub 600 had horrible laite payments and stuff.
So, if the first one qualify, you would sign the lease with him based on the fact he came first?
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Justin Fox
Software Developer · Vidor, TX · Member since 2015 · 922 posts · 639 votes
9y
@Samuel Lacroix
If you send people your criteria up front you'll find that you will get fewer applications from shady people. Those types of people usually can't pass the rental history, eviction, satisfied judgment(s) and/or other criteria.
Yeah, either he qualifies or doesn't. If not, move on to the next.
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Peter MckernanBusiness Member
Residential Real Estate Agent · Irvine, CA · Member since 2013 · 2k+ posts · 1k+ votes
9y
@Samuel Lacroix Sounds like you are getting there!
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Samuel Lacroix
OP
Investor · Québec, Québec · Member since 2016 · 33 posts · 13 votes
9y
Mmmk :/
@Justin Fox is for first-com who meets min. standards
@Robert Melcher is for best tenants.
I would need more advices to get a consensus here lol.
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Robert Melcher
Residential Real Estate Broker · San Antonio, TX · Member since 2016 · 506 posts · 311 votes
9y
@Samuel Lacroix as a professional I also have to be careful of fair housing standards in the US and Texas. I can't speak to the legal requirements a-la-Quebecois, but be careful of any possible liability you may create. Hence the published criteria and review of our process for legal compliance.
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Samuel Lacroix
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Investor · Québec, Québec · Member since 2016 · 33 posts · 13 votes
9y
@Robert Melcher Good point. I'll give a call to my local Landlord Association. As far as my standards goes, they aren't published anywhere, just in my head. But I would include them in my listing in the future.
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Michael Noto
Real Estate Agent · Southington, CT · Member since 2008 · 5k+ posts · 3k+ votes
9y
@Samuel Lacroix This isn't nearly enough information for anyone to make an informed decision. Also, I find that trying to predict how long someone will stay in an apartment is a waste of your time as a landlord. Rent it to the most qualified of the 2 and go from there.
There has to be some way to differentiate between the two: credit score, income level, length of time at job, etc...
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Samuel Lacroix
OP
Investor · Québec, Québec · Member since 2016 · 33 posts · 13 votes
9y
@Michael Noto I'm not normally trying to predict how long one would stay in, but here It's a bit of a clash here.
Young applicant is an out-of-towner who's fresh out of firefighter school. It's really tough to get a full-time job in that field here so he came to the village to get experience as a volonteer firefighter (the building is in a 1 000 inhabitants village). I know for a fact that those people generally move out in the coming two years.
The older one literally said to me that he's looking for an appartment to stay there as long as could (meaning here that he'll either die there or move out when he won't be able to live by himself).
I know that this still don't guarantee anything, but the odds are there for the older one to stay longer.
Anyway, the bigger question here is:
You have two applicants, they both meet your minimum requirements. One applied one day before the other.
Do you chose on a first-come basis or do you choose the best?
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Justin Fox
Software Developer · Vidor, TX · Member since 2015 · 922 posts · 639 votes
9y
@Samuel Lacroix I would have processed the youngin' and determined that he satisfied my requirements, get the lease signed, close all the ads and mail the old dude his fees back (and cancel the next day's viewing).
Why not wait for applicant three, four, ..., thirty? Might get a better applicant but you have potentially wasted weeks (time and money). For all you know the old guy will bail first time you increase rents because he's on a fixed income. Then you're in the same boat, except maybe the youngin' could have foot the bill.
If length of stay is part of your requirement, then you need to update your criteria to, "Must sign a 5+ year lease." Otherwise, you pick the first qualified tenant while ignoring the rest and save lots of processing time.
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Samuel Lacroix
OP
Investor · Québec, Québec · Member since 2016 · 33 posts · 13 votes
9y
@Justin Fox Ok I hear you.
Of course, once I got an applicant that meets the requirement, I won't wait in case someone better shows up. In this particular case, the second guy came when I hadn't processed the first one yet.
The whole thread was more to see the ethcial standpoint.
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Justin Fox
Software Developer · Vidor, TX · Member since 2015 · 922 posts · 639 votes
9y
@Samuel Lacroix
In that case, you still have the same dilemma. You still had to do a background/credit check on the one of them first. So you ran the background and/or credit checks on both and then started to process them.
If they both meet your current minimum requirements and length of tenancy is not a listed requirement, then you have no leg to stand on denying the rental based on the pinky-swear from the older gentleman. Even if the credit score of the younger applicant is 600 (current minimum req.) but the older man's is 640, if you're going to pick the older guy because his credit score is higher, then you need to increase your minimum to 640+.
When you process someone's application and they meet your criteria, but you skip on them and wait for better or choose the next for any arbitrary reason (non listed or documented as a criteria), is that really your minimum requirement(s)?
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Samuel Lacroix
OP
Investor · Québec, Québec · Member since 2016 · 33 posts · 13 votes
9y
@Justin Fox
I guess that wouldn't be fair to deny the first one. That's what looked like to be the most ethical choice. And like things to be fair and square.
Thanks for keeping me in the right path :)
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Colleen F.Pro Member
Investor · Narragansett, RI · Member since 2013 · 8k+ posts · 4k+ votes
9y
Don't bank on people staying because they say they will. The older guy is statistically more likely to die then the young one so he might also "leave" sooner. I used to go with 1st qualified but you can also go with best qualified by some date. I have added some unpublished criteria as well argue with me on the phone, show up late without calling... you sound like they are both good but you have not processed anything yet, take an application from each of them. you can always accept more then one application.
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Amy Beth
Rental Property Investor · Edison, NJ · Member since 2016 · 753 posts · 565 votes
9y
We select the best candidate which is not always the first applicant.
2 Reply
Thomas S.
Member since 2016 · 13k+ posts · 12k+ votes
9y
If you care about your business future you always choose the best candidate from all applications. When they apply is irrelevant.
Ethics does not enter into the equation, you placed a unit for rent, you received applications you choose the most qualified/best fit for your property. You are not in any way obligated to any applicant in your selection process. Plain and simple.
Tenants have rights, applicants do not (aside from the housing police regulations)
If your first applicant is unemployed or does not have a consistent two year employment with the same employer (which he does not) he does not qualify and should be rejected without further consideration.
If the old guy has sufficient income (3X rent) and can manage annual rent increases he may be acceptable but it is important you review his entire past payment history and dig deep into why he is moving. I have found many older renters with low credit scores to be quite deceitful. Old people should have perfect credit.
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Steve Babiak
Real Estate Investor · Audubon, PA · Member since 2009 · 13k+ posts · 8k+ votes
9y
So, you want the older guy, which is fine by me. Just something else to consider though - if he is retired, he will be home most of the day, whereas the younger guy will be away most of the day. More time spent in your unit means more water usage, more wear and tear, more complaints!
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Samuel Lacroix
OP
Investor · Québec, Québec · Member since 2016 · 33 posts · 13 votes
9y
@Colleen F. Good advice about the unpublished criteria. I'll add this as well :)
@Thomas S. He's still working, but good thoughts though.
Seriously, awesome advices I got there :)
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Thomas S.
Member since 2016 · 13k+ posts · 12k+ votes
9y
I would not select a applicant based on having a guarantor (endorser). First off it is more work for you which is unnecessary and second guarantors are simply another layer to navigate when a tenant defaults. For student rentals they are necessary for all others if you need a guarantor you are trying way to hard to make unqualified applicants fit. The purpose of screening is to find reasons to reject applicants not reasons to accept them.
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