which application should I pick: a CEO or a section 8 family????

Question

Hi everyone! We need your help with a tough decision. We received two applications on our 3-bedroom apartment from tonight's showing, and my husband and I have different opinions regarding which to pick.

One is a 25-year-old CEO of a 2-year-old start-up. He will occupy the apartment mainly by himself and use it as a home-office. He offers to pay 6-month rent upfront to seal the deal. But he would not commit to staying at the place for longer than 1 year. So we would anticipate turnover when the one-year lease ends. He has a girlfriend attending graduate school in another state who may occasionally visit. He had one criminal record of serious speeding, and SmartMove recommended 'Low Accept'

Another is a family with section 8 voucher that consist of mom (around 55) and two kids (25, 30). Actually all of them have a job that pays OK. Their total income is about 2.8 times rent. With section 8 voucher, their portion of the rent is even <$100 (according to one kid). They stayed about 5 years in each previous place according to their rental history, and they provided us the email from their current landlord that says many good thing about them. SmartMove recommend 'Low Accept' for two of them, and 'Accept' for the older kid. No criminal record.

Should we choose an the lump sum, or long-term (hopefully stable?) cash-flow? The CEO requested our decision in morning, and he can sign lease and make payment in the evening. Any thoughts would be appreciated!!!!

Thomas S. · Answer

Section 8. This group of misfits is a problem waiting to happen. Do not trust any landlord report you receive about them. A old woman with 2 adult children is not a healthy situation. Next thing you know there will be girlfriends and a pack of welfare children, dogs and other nefarious individuals hanging around.

The start up CEO although risky is a better choice if no one else comes forward. I would consider accepting him but would refuse the 6 month bribe.

Any advance payment remains the property of the tenant, must be placed in a separate bank account and may not be touched by the landlord except to withdraw the monthly rent payments. Additionally the tenant has the legal right to demand the return of any cash in the account at any time.

Legally a advance payment guarantees the landlord nothing and is usually a red flag as it is clearly intended as a bribe to entice mom and pop landlords. If he were not a high risk and having problems finding a landlord to accept him he would not need to offer bribes.

Take the CEO if you have no other options but make it clear rent is paid monthly not in advance. Do not offer him a term lease, make it M2M to insure that you are protected if he defaults or causes any issues. If he balks at the M2M consider yourself lucky that you dodged a bullet.

Remember every new tenant is a stranger that can not be trusted.

Jonathan R. · Answer

Every time I rent a home, I want to take a shot at a long term tenant. I will also say, it depends on your plans. If you are a true buy and hold investor and are not overly concerned about appreciation per say in the neighborhood, go with the Section 8 tenant. If the home is in an up and coming neighborhood and you are only planning on holding the property for a few years and want to bring up the value of the neighborhood, go with the young buck. I would also look at how much you have invested in the property. I own a Section 8 rental and am all in at 32k. If my renter stays for 5 years, the house has paid for itself. If they tear it up a bit, oh well, there is more where that came from. :)

Hilary Mayhew · Answer

Please also be wary of "advice" here that sounds a lot like housing discrimination against section 8 tenants in particular.

Doing your due diligence about any and all applicants is a good way to avoid being "seduced" by a terrible tenant who "seemed so nice", as much as it prevents you from rejecting a great renter with a great track record, who may be falsely stereotyped.

Others here have given good advice about how to do more due diligence research on both applicants, which is helpful for me too as I consider new tenants and I'll be putting that into practice. Calling the second to last landlord instead of the recent one is definitely on my list of great tips.

Lastly, I'd weigh the risk of another month of vacancy against the risk of non payment or needing to evict someone later. Maybe one or both applications check out, or maybe they don't, and you want to wait for different applicants.

Deanna McCormick · Answer

traffic in the unit,, 1 person verses multiple people equal more wear and tear and your building will show it.

I'd go single person,, don't do rent in advance,, or let it spill over what your paid this year for next years rental income / taxes..

section 8 requires a inspection if your unit doesn't pass you'll be delayed in placing the other tenant and the paperwork required is alot to contend with.

To me it's a no brainer..

Jay Hinrichs · Answer

I am admittedly the worlds worst landlord.. but if it was me I would take the kid and the money up front I might counter with a full year paid in advance.. I have owned a few hundred section 8 homes.. and you can take some serious ware and tear with those.. the adult children living at home ??? really.... and then how many kids do they have ????

Rich N. · Answer

how can the section 8 family make "enough" money yet still qualify for section 8? Did you verify their job/salary/paystub or call the number they provided that might be their friend ?

As for both, never trust their current landlord as they might be lying to get rid of them.

Did you check masscourts for any eviction proceedings against any of them ?

If you go with the CEO, just make sure you have him sign a letter or add a foot note to the lease that it was his offering to provide the 6 months upfront.

Amy Beth · Answer

You left out important details. Any prior evictions? Do any of the candidates have collections and are they recent? Do any of them carry a lot of ongoing debts such as car loans, student loans, credit card debts that might make it difficult to pay rent plus these other bills? Why did it say low accept (if the site gives a reason)?

which application should I pick: a CEO or a section 8 family????

which application should I pick: a CEO or a section 8 family????

Most Popular Reply

10 Replies