We've just started showing our first unit. It's non smoking, minimum income of 3 times the rent, basically all stipulations listed in Brandon & Heather's management book.
We had a prospective tenant ask to bring her 10 week old German Shepard (it's pet friendly at owner's discretion), she admitted that someone in the household smokes but insists that it won't be an issue, and her income is barely over the rent...even AFTER I went over all our qualifications with her.
Am I still supposed to show the house to her? And offer an application? I'm confused between not wasting my time and Fair Housing Laws. And what's the point of the questionnaire, if not?
@Alyssa Paros Clearly layout all of your pre-screening requirements, inform them of the fee you charge per application, and what the background check includes (credit, criminal, eviction check, income verification, etc..). From there the situation usually takes care of itself because typically people will not waste their time coming to view an apartment they know they will not qualify for.
If someone wants to see the apartment after you list the pre-screening requirements I would highly advise against refusing to show them the apartment based on what they said in passing. You can get yourself jammed up doing that pretty quick.
The main problem I see is that landlords and agents are not clear enough about their minimum requirements to rent an apartment and it causes confusion and leads to wasting time for the tenant candidate and the person filling the apartment like you mentioned. The bottom line is, you do not know anything about someone until you fully run all of their checks and have their proof of income. Even thinking about "what ifs" with an applicant is a big emotional drain on landlords and those who fill units for a living.
As far as pets go, I would recommend being decisive on what you will accept and what you won't. Saying "at owners discretion" will lead to a ton of tire kickers reaching out to you. For instance, you can put something like "no restricted breeds" or "no dogs, but owners will consider 1 cat". Mention what you are willing to deal with in terms of pets rather than leaving it open ended.
You can decide in advance if you wish to reject a applicant but should probably go through to process unless they are obviously unqualified based on your screen standards. Bottom line is you can reject a applicant on a personal feeling if you wish.
You need to get your s**t together on your pet standard. All pets can/will do damage some simply are higher risk than others. Safest option for landlords is NO pets.
@Thomas S. Actually, I like our pet policy. And while I understand pets are a risk, I also know I was a pet owner myself when I was a renter and needed a place to rent that welcomed my terrier. Ken McElroy has stated on numerous occasions that he has never had issues with pets, even if he’s had trouble with pet owners. We will continue to rent to pet owners.
And I would ask that you remember that this is a professional forum and would ask that you conduct yourself in such a manner. Yes, we will continue to better our business practices daily, as that’s what a well run business should do, but don’t mistake my inquires as naivety or disfunction. I very much have it together. Thank you for your response.
I would be hesitant to use a questionnaire to avoid any legal issues if I reject someone without doing a background check. But I think it you make it clear about your requirements to be approved regarding income requirements, no smoking for any occupant, etc many will just not follow up with a showing or submitting an application and that saves you both time and will avoid you have to do anything that may or may not be legal.
You could also arrange for a group of potential tenants at the same time to view the property at the same time so if the potential tenant does not get the message you have not wasted your time by showing the apartment just to the person whom you know will not qualify.
Make your qualification very clear.......if they still want an application, then give them one....if they still want to see it at a group showing they are welcome to attend
The issues come up when you make up the qualifications as you go, or don't allow them to take the next step even when they know they don't meet the qualifications.
EVERYONE asking should be given an application and allowed to attend a group showing........ even if you know 100% they don't meet your written qualifications that you have provided them in advance...... don't waste your time on them, but don't tell them "don't bother to fill one out or attend".......
Side note....... even if they promise to only smoke outside.....that wont happen......if your policy is no smoking, then its no smoking..... no promises.
Don't waste your time on individual showings unless you have some rock start applicant..... group showings on a certain day and time....ALL are welcome to attend
@Alyssa Paros you are getting some confusing advice so allow me to add my $0.02 to the discussion.
You can ABSOLUTELY reject their application.
The purpose of an application is to determine whether the applicant is an acceptable risk. If their income is barely 70% of the rent, that's a perfect indication they are a HIGH RISK. Rejecting their application does not put you at risk of a Fair Housing violation.
Around 70% of all renters are pet owners. If you reject pets, you lose a large chunk of the market. Also, most pet owners are good people that will take responsibility for any damage caused by their pet. Pet owners tend to stay longer and they're willing to pay more, which off-sets your risk. Accept pets but require a non-refundable deposit or (my favorite) charge them a rent increase based on the size/type of animal. For example, you may charge a rent increase of $25 for a Chihuahua and $50 for a Labrador.
I also do NOT recommend allowing pets under one year of age. There is a HUGE risk of damage due to potty-training, chewing, and other issues. If you do allow a young pet, require a large, non-refundable fee because there is at least a 505 chance something will occur.
If you have any specific questions, please feel free to email me directly and I'll be happy to help.
@Ned Jackson @Nathan G. First of all thank you both for your responses as they are very helpful. Do either of you send a paper stating what qualifications are required to be accepted along with the application to an interested applicant or is it more of a verbal notification?
I guess as a hypothetical, if someone would say their income and it is far too low for what we accept or they say they have a pit bull, should we then say well based on the information we have, your application would be rejected but you can still take the next step if you want to.
I know this is a lot of questions and probably obvious to a seasoned renter but with the two of us renting our first unit of a tri-plex, we just want to make sure we do everything by the books.
Thanks again to all for the help we really appreciate it.
Hi @Alyssa Paros ,
You, as an owner can deny anyone for any reason. As an agent, I am unable to.
Put no smoking in the lease, if you do a 6 month inspection and it smells like smoke, they have breached the lease and you have grounds to evict them.
German Shepherds are my favorite breed of dog, however, they make the list for aggressive breeds. I recommend you call your insurance company and ask for a list of breeds that they don't insure in the event of a dog attack. Sometimes German Shepherds are on them, sometimes they're not. If the breed is on that list, don't take the risk.
Unqualified candidates are not a protected class by Fair Housing standards, so not to worry!
You can refuse to show based on the fact that even if she liked it, she would not be considered as a tenant because she does not meet the minimum requirements for consideration.
Join the Largest Real Estate Investing Community
Basic membership is free, forever.