How to deal with approving quality Tenant Screening

Question

What happens if you already know the person trying to rent your unit does not qualify? Should you allow them to look at the place and filled out the application? Or can you tell them straight out that they don't qualify already and not let apply?

Current reason not qualify: 1. Temp Job  (income not stable) 2. Person just got out of prison after doing 2 years for DUI 5th.  3. Fact that they are living in a motel for the mean time.

Thanks in advance!

Dick Rosen · Answer

The DUI may be a Fair Housing Issue, I wouldn't bring that one up. The motel really isn't a bad thing. But based on my criteria I would tell them that we require 3x's the rent in verifiable income with 3 consecutive pay stubs. He's not going to have that so tell him he wouldn't qualify.

Jan Kutrzeba · Answer

Hi @Kham Sing,

Experienced Brooklyn (NY) rental real estate agent here. I've rented hundreds of apts in the Brooklyn market over the past four years. My two cents below...

What are your tenant requirements? Do you know exactly what they are, and have you clearly communicated them to people who want to apply for your apts?

I don't see where you're located (every State has different legislation) but in my market, all three of the criteria you mentioned would be unlawful reasons to decline an application. In New York, you cannot discriminate against someone based on the type of employment ("temp" vs. "full-time" or "contract" etc.), or just for the fact that an applicant did 2 years for a DUI, or based on the applicant's current living situation.

1. your applicant's temp job may be e.g. software development, for which they might be getting a 6-figure salary

2. Having a DUI on their record doesn't necessarily mean they're not paying their bills (incl. rent) on time

3. Living in a motel is a personal choice, and frankly it sounds way better than sleeping on Mom's couch, although that also wouldn't be a reason for a landlord to decline an application in NY.

Here are the criteria all Brooklyn landlords I've worked with use:

1. good credit (680 and above)

2. proof of income (min 36 x monthly rent: $72k/y on a $2k/month apt)

The source or type of income is irrelevant. In order to get approved, the applicant must fulfill both the credit and the income requirement. If they don't, we ask for a guarantor to co-sign the lease. The guarantor requirements are:

1. good credit (700 and above)

2. proof of income (min 72 x monthly rent: $144k/y on a $2k/month apt)

I often clearly state these criteria on the apt ad online, and I pre-screen applicants on the phone. I simply ask them: "How's your credit? How's your income?". It might sound rude or too direct, but NY applicants are used to these and understand this is a practice that saves both their and my time.

If they don't pass the pre-screening on the phone, I won't show the apt as it's everyone's waste of time. I advise them on how to build credit or direct them to Insurent and help them with other options, but respectfully tell them I won't show them the apt if they know from the start they wouldn't qualify for it.

In Brooklyn we say: "credit is king!". Your tenant might be making $1M a year, but it won't guarantee s/he is paying her/his bills. Check their credit. It never lies. Ppl with good credit rarely want to mess with it. Whenever we've made exceptions and approved ppl with lower credit with an extra security deposit (or two), problems have been more likely to arise.

Good luck finding great tenants!