Should I be hesitant about this applicant?

25 Replies

BP,

I'm currently screening tenants on my first investment property using TurboTenant. Everything has run smooth and I've had a ton of interest but of course after sending our minimum qualification standards only a couple people have applied. One couple in particular I feel really good about but I have a weird feeling so I need some help. This couple is about to relocate to capitalize on our low cost of living. The wife is currently employed making more than 3x the monthly rent but she has not yet secured a job here in our state. The husband is a disabled veteran. They have provided proof of income, proof of disability, drivers license's, 401k statements, etc and so far EVERYTHING has checked out. The only thing is they want to move in without seeing the unit prior. They are comfortable signing a year lease and they also have offered to pay for 3 months rent up front. So far they seem like the perfect tenants but I am very skeptical about moving forward and them signing a lease without having seen the unit and without having met them in person. Thoughts or feedback from past experiences in these situations?

Lots of red flags here. Sign a lease on a unit I have not seen? 

Originally posted by @Justin Youngblood :

BP,

I'm currently screening tenants on my first investment property using TurboTenant. Everything has run smooth and I've had a ton of interest but of course after sending our minimum qualification standards only a couple people have applied. One couple in particular I feel really good about but I have a weird feeling so I need some help. This couple is about to relocate to capitalize on our low cost of living. The wife is currently employed making more than 3x the monthly rent but she has not yet secured a job here in our state. The husband is a disabled veteran. They have provided proof of income, proof of disability, drivers license's, 401k statements, etc and so far EVERYTHING has checked out. The only thing is they want to move in without seeing the unit prior. They are comfortable signing a year lease and they also have offered to pay for 3 months rent up front. So far they seem like the perfect tenants but I am very skeptical about moving forward and them signing a lease without having seen the unit and without having met them in person. Thoughts or feedback from past experiences in these situations?

I've only once rented a unit to someone who hadn't viewed it in-person. In that situation a family member paid the rent, tenant was moving from out of state, and at least the family member who signed as a guarantor did view it.

There really isn't any reasonable logic for an applicant to rent a unit w/o viewing it first. That's a HUGE red flag, same with applicants who show up and 10 seconds later, even without looking around, start talking about how soon they'd like to move in (that weekend) and how great the apartment is. If folks are well off enough to pay 3 months rent up-front they can afford to live in a hotel for a weekend while they find somewhere that fits their needs.

In this particular case (especially with mentioning "disabled veteran" which is very common in scams), I imagine they'll pay the 3 months, then just before move-in date will request a partial refund because work transferred them out of the country, and after you do so their check will bounce and you'll be out a ton of $$$.

@Alex S.

What prompted them to suggest 3 months upfront (unless you mean first, last, security)?

This does sound like one of the scams found in other posts where someone volunteers to move-in and send a check. Then something “comes up” and they can no longer move. They ask you to send the money back or part of it (your money because their check turns out to be fake).

If something seems off to you then it probably is. Why would they want to move if the wife still works in another state and the husband can live anywhere?

Suggest you look at other candidates. There has been lots of scams especially from Craigslist. You need to interview them check VA id, if it is mutual you two sign a lease using certified check or taking cash. 3 months rent up front? They sound like they are ready to set you up....


Make sure you check their credit and previous landlord references.  Googling them is good too.  Make sure they actually lived where they say they have.  The credit report will verify previous addresses.  It might be okay.  Several of my friends have moved to NC even though they have no connections there.  It makes me want to buy an apartment complex there...

Moving from another state is not a "big red flag" like others are implying. It's very common for people to move states and try to procure housing before arrival. 

Your screening should include a way to verify their identity, current employer, current residence, etc. If done properly, your screening will weed out anyone attempting to commit fraud.

I use a "sight unseen" clause to prevent problems:

American West Realty does our best to adequately describe our rental units to you. We strongly encourage you to personally inspect the premises before entering into any agreement. Should you elect to rent the property without first inspecting it, at your own choosing and for your own convenience, neither American West Realty or the Owner will be held responsible for any misinterpretations or problems that could have been avoided had you personally inspected the property prior to the execution of the lease. American West Realty makes no warranties as to the description of the property provided it meets the basic standards of safety, health, and habitability.

If they show up and decide they don't like it, they can terminate the lease and pay the penalty.

I would NEVER do a lease with a prospective tenant who hasn’t seen the unit and I haven’t met THEM. I need to get a feel for who will be occupying my investment. Some things can’t be communicated over phone/e-mail.

I will provide the other side of the coin potentially here. I personally had to relocate for a job, and moved in a tight timeline(3.5 weeks) out of state (460 miles away) during the holidays. 

I had a friend who was in the city I was moving to look at 2 properties I found online, and be my eyes for me. I took their word and recommendation on the unit I ended up applying for and securing. 

I talked to the owner of the condo for nearly an hour on the phone, and he was comfortable after that call, meeting my friend, and my ability to wire first and last month rent to him within 24 hours.

The first time I myself saw the condo was when I drove my Uhaul to unpack. Could things have gone wrong? Absolutely.  Who would be to blame? Me. 

From the owners side of view, you trust your gut. If you think there is an ounce of hesitation with these people, move on. They will find a place somewhere in town if it is truly meant for them to be there, and you will find a renter you feel good about.

I've sold 2 properties sight unseen this past month. Both to people who will be living in them as a primary residence. Finding a short term sight unseen place is not a red flag to me. If I was moving to a new area the best bet would be just finding some place for a year while you get situated, learn where you want to be and where your new friends end up living. 

I'd take the money and then provide keys when it clears

They do not meet the minimum 3X rent income wise. Their income yesterday has nothing to do with tomorrow and at this point in time they potentially have no income. This is the reason for the offer of a bribe (three months advance rent). It is an attempt to take advantage of landlords seeing dollar signs to persuade them to ignore their screening standards. The fact they are taking the unit sight unseen combined with the bribe often means once they arrive they will begin looking for a place they really want to live in and they will be gone at the end of the 3 months. 

Of course they are comfortable signing a year lease since they know a lease does not hold them to the unit. They will move out when they choose regardless and there is nothing you can do to stop it. Collecting a dime after the first three moths is unlikely.

The fact is they may turn out to be great tenants but that is a unknown. What is known is there are multiple red flags. My experience tells me this applicant is potentially a high risk. The purpose of screening is to reduce risk.. correct. When you remind yourself of the reason why you screen, to reduce risk, it would be a obvious waste of your time to do any further screening. You should, I would, reject their application. Screening successful.

I don't really see them not viewing the unit as a red flag either. That happens with us from time to time and we also have a sight unseen addendum for prospects to sign. 

It's their income I would be worried about. The wife's income doesn't mean hardly anything without a job in their new location. 

They have zero income once they move into your rental. Unless she is a career like nursing or doctor or something that she can find a job immediately. How about their bank account, do they have enough reserve to pay for rent and other living expenses.

@Matthew Olszak thanks for the feedback. I had some of these same initial thoughts. Aside from a bounced check fee if I were to accept a personal check (which I don't plan to) what other money would I stand to lose? Couldn't I just require a cashiers check like someone mentioned below?

@Justin Youngblood Sounds like they do not meet your minimum income requirement if the wife doesn't even have a job yet. Did you run their credit yet? How does that look?

@Amy A. Thanks for the info. Yea NC is a great area. So far all their references have checked out and my googling has turned up with no red flags. In fact some of the stuff I found matches their story. Trying to just be very cautious here.

@Mike Cumbie same here. I'm also an agent and I just closed on one with a buyer and they had just seen it over FaceTime. I did require them to sign site unseen clause. I would definitely require that in this situation.

@Michael Noto both of their credit looked good. The partner who is a disabled vet receives 3x the monthly rent each month. They've also provide bank statements showing they can cover the rent well over the potential year lease

@Sam Trentwood she is a chemist and I doubt in this area she will have a problem finding a job. She has provided bank statements and and 401k statements

@Thomas S. Thanks for the feedback. So what if I just required deposit, first and last months rent? Is my only recourse eviction if they didn't pay anything after three months?

@Justin Youngblood I can understand why you feel uneasy about the possible transaction. However, I moved from NY to CA and sign a lease without seeing the place due to job. I did not have the job secured until I made the move, and I am also a disabled vet. If everything checks and they have provided the proof of income as well as offering 3 months pay, I say they are worthy of some trust

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