How to Handle Renting to Waiters?

Question

How do you handle getting applicants from waiters/waitresses and other jobs that are partially/mainly paid in cash? It doesn't quite seem fair to completely exclude people who earn 3x rent but obviously can't substantiate this with paystubs. Yet we are running business and have qualifying criteria for a reason. How have other landlords been handling this sort of thing?

James Mc Ree · Answer

Ask for a copy of their tax return.

Thomas S. · Answer

I screen based only on their actual pay checks. Tips, like applicants working on commission, do not count toward income since they are not consistent. Some one will rent to them but unless they qualify it will not be me since I never work at trying to qualify applicants.

I am far more concerned about being paid than I am about being "fair" to applicants.

Dick Rosen · Answer

We ask for 3 consecutive bank statements that show the deposits. If they aren't putting it in the bank they probably aren't claiming it and paying taxes on it either. In that case we can't count it either.

Vaughn Smith · Answer

@Louis Aller you can take a look at the past two years of tax returns, cash reserves in a bank account or across multiple accounts (ask for statements fro the past 90 days) as a way to mitigate risk in addition take a look at their actual credit report not just their score to view utilization rates, payment history etc. Lastly if your market can bear it perhaps you ask for a bit more of a security deposit.

Wesley W. · Answer

The above suggestions are good.  I insist upon a double security deposit to mitigate any sporadic cash flow (never allowed to be used as rent, but covers me a bit more if there is a problem and we need to part ways).

Louis Aller · Answer

all good advice, thank you so much everyone!

Mark Nolan · Answer

Yup, 2 years of tax returns for me.  If they can't prove they make enough to qualify, then they simply can't rent from me.

How to Handle Renting to Waiters?

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