I am in the process of leasing my first rental property. Its a low income property so of course there are a lot of people applying with "less than satisfying" applications and understand that as a land lord for this type of property I will have to overlook some things. I have received several applications as of yet but I do like one. The credit is bad and there is a prior eviction but I have talked with her and she was very upfront with everything and explained pretty thoroughly and it seems their situation is better now.
My ultimate goal is to maybe market the property for another week to see if I can get something better, and if nothing comes through then see if I can work it out with this family.
How would you suggest prolonging that situation? They paid $60 ($30 each) and applied and are expecting a decision asap. I want to wait it out and use them as a plan B if nothing else comes along in the next few days. What would be the best way to handle this without getting into deep water?
@Vincent Plant Keep marketing the property until you find an applicant you feel comfortable with and meets your criteria. Have rushed filling properties in the past and it's come back to haunt me. In the end, it's better to have a vacant unit than one with a bad tenant. Good luck!
I don't think prolonging the situation is a good solution for you. You should decide whether to rent to them or not, and without feeling pressured since poor credit is not a protected class. Maybe you need to get your comfort level up vs. waiting for someone better. The last time I was doubtful I asked for a co-signer, and the tenant produced one with a very high credit score. Or you could also ask for additional security deposit money, or two months rent up front.
Any time you are renting a low income property, you are going to get applicants with less than desirable credit scores...that's why they are living in low income properties. Do you run a background check? I would also consider their driving record and any other criminal activity. If they seem responsible in other areas of their lives I would take that into account. Also, not knowing if your property is in a B or C area it's hard to say whether it would be worth the wait.
Let us know what you decide, and how it turns out.
Even in a “low income” area, you should consider coming up with written criteria for the applicants. Ultimately it’s easier for you, helps avoid complaints of discriminations, and is just a more professional way to run your business.
Stringing applicants along after they’ve paid the application fee and are awaiting an answer, while you wait for something better to come along, is not really fair to the applicants either.
Yeah you’re doing this wrong. Pick an income requirement, minimum credit score and probably say no past bankruptcies judgements from other landlords or evictions. If they meet all that criteria you need to rent to them, else you may come across as discriminatory
I understand that in your area you can’t expect good credit. However, I would not accept anyone with an eviction no matter what story they have. They promised another landlord to pay the rent and did not. Plus they did not leave when they could not pay, they required the landlord to evict them in court. This is not someone you want to give a chance to.
It would be better to rent to someone with bad credit without an eviction history than someone with an eviction. This could be a professional tenant whom is excellent talker but will result in you having an expensive eviction and loss of rent. I would also call past landlord of prospective tenants to see what they have to say about the tenant. That should be more telling than their credit scores.
One thing not mentioned that I think a lot of new landlords miss is to factor in the eviction laws and procedures of your state and city. Here in Las Vegas, NV I can evict for non-payment in 12 days. Lease states rent due on 1st of the month and late with late fee on the 5th. If rent is late, I post a 5 day Pay Or Quit Notice and if tenant has not paid by the 10th I can get Sheriff to evict 2 days later. So my risk and cost of an eviction is a lot less than another state where it might take months to evict a tenant. I had a property manager tell me a story that in New York he had a client that took 23 YEARS to evict a tenant in court.
Know your costs to evict and let that guide you on borderline applications.
As a landlord, it's not your responsibility to "work" things out with someone who has a history of bad credit and a prior eviction. You need proof that their "situation" is "now better". How is this? Is this because everyone else you have looked at is so bad?
I understand where you are coming from. We currently have our smallest (and cheapest) rental up for rent and the type of folks who have shown interest in this one...while impressive in numbers...are generally depressing in lifestyle. I'm avoiding the phone calls from those asking me to "discuss issues with them" as this typically means some sob story about their sad and depressing life on how they screwed up royally more than once and how I, as a landlord, am supposed give them one more chance by turning over to someone who has made many mistakes in their life a property worth many thousands of dollars.
Then of course, you have those who attempt to override any screening by telling you they have money just burning a hole in their pants. Frankly, I don't really care what they've got stuffed in their pants.
The bottom line is you set your criteria and you continue to follow it. For us it is no history of dispossessory filings (the first step to an eviction in my state) or an eviction, no accounts in collections and income at least three times the rent. No "working" with someone on the deposit, etc. etc.. Cut and dried. It may take a while but the right tenant will come along, even for a low rent property.
Hi Vincent. I would be very cautious renting to someone with bad credit AND an eviction on their record. I would make sure that they fit your rental criteria (or create a rental criteria if you do not have one) or they have a cosigner who does in order to protect your property and avoid having to go through the expensive process of filing for eviction. I honestly would reject this applicant simply because of the eviction on her record, you are running a business and nonpayment could threaten the cash flow of your business. At the apartment complex where I worked, we would not accept anyone who had any sort of skip or eviction on their record. This protected us from having to go through the eviction process often.
“she was very upfront with everything and explained pretty thoroughly and it seems their situation is better now. “ ////// You sure about that? Tenants lie. It’s what they do. I would not rent to somebody who has been evicted. Also, I have a pre screening process to save the $$$ on a background check that I’m going to deny anyway.
I agree with the others. If you have standards, stick to them. If you can't find tenants, consider lowering the standards. It sounds like they don't fit so reject them and keep looking.
As a general rule, I do not accept tenants with prior evictions. However, I have made two exceptions. In one case the eviction was almost a decade old. The tenant still has terrible credit but now prioritizes rent.
In the other case, the tenant still has terrible credit but the evicting landlord gave them a good reference on how she left the place and the problem was temporary and she now has very high income (though still terrible credit).
In both cases, over a year in, it has worked out for me (so far)