Help! Should I rent to these people?

Question

Hey y'all! I'm renting my first deal as of 3/10, yay! But I have a question, I have a mid-high end 2 bed, 2.5 bath, 1600  sq. ft. townhome that I'm renting for $1295, a good market value price in my area in Alabama. I have potential tenants who seem very serious on moving in as soon as they can, but there are a few red flags and I'd like to know what other landlords would do in this situation.

One girl has credit score of 400, her supposed boyfriend has credit score of 650, 2 other adults will also be moving in with them, which is the height of our limit of 4 people per room, I don't know the other 2 credit scores yet but of course I'll screen. Apparently there's 4 separate incomes, so there's that, but do I need to do anything special here? Should they all still be on the lease? Should I deny them? Any advice?

Thomas S. · Answer

You have already provided enough information that would have me rejecting their application. You state there is a few red flags. One red flag and you reject. 4 unrelated adults...no way.

You need to study how to properly screen. You must set a minimum credit score and never go below it when accepting any applicant.

Thomas S. · Answer

I begin seeking replacement tenants 2 month ahead of a upcoming vacancy. I do not rent to anyone needing the unit sooner than a month out even if it is vacant. I do not hold any unit for a applicant beyond when it becomes available. I build vacancies into my expences and will rely on that ahead of increasing my risks.

Plenty of fish in the sea.

Casey Culver · Answer

Wow! Thanks everyone for the responses! I was leaning heavily towards "no" anyway, but y'all confirmed it for me.

Some of these answers beg another question...how far in advance do y'all typically let tenants move in after they sign the lease? I'm assuming that time goes unpaid right? I've had multiple prospects asking if they can move in 1.5 - 2 months from now, but that seems too far out to me, am I mistaken?

Corby Goade · Answer

@Joshua Saunders is being generous- a 400 credit score means they DONT pay for things. Read up on fair housing laws and determine your criteria for tenants, stick to it no matter what. I know with this being your first rental, the idea of vacancy is scary, but please trust me; a month of vacancy while you wait for a great tenant is going to save you thousands of dollars, hundreds of hours and immeasurable amounts of stress compared to what will happen if you pull the trigger on a questionable tenant because you are eager. Be patient and you will be rewarded.

Chris Szepessy · Answer

To me, wanting to move in right away is a bigger red flag than the credit score.  However, they probably go hand in hand.  I'm sure with 4 people they make enough to afford the rent, but actually being responsible enough to PAY the rent is a whole other story.  I know it can be stressful when you have a vacant unit with a mortgage to pay, but an eviction is a lot more expensive than missing one month's rent to find a better tenant.  I'd pass on these applicants.

Peter S. · Answer

@Casey Culver - Any person over 18 should be screened and on the lease.  Sometimes no credit is better than bad credit, why the low scores?  Is it due to foreclosure or due to eviction or other bad decisions.  Also a tenant wanting to move in right away and not wait till the first might mean they are only days away from being homeless/evicted.

Help! Should I rent to these people?

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