Tenants combined income or each must qualify?

Question

I am marketing a couple of rental properties and have several people interested. The problem is that the people I would like to rent to do not qualify individually but do qualify as a couple. Should I keep looking for better qualified candidates or would you take them as a couple? They have a 9 year old together but are not married.

Nathan Gesner · Answer

Income should be qualified, married or not.

However...I have higher standards for three or more unrelated people. If this were three friends, I would require each individual to make 2x the rent. Why? Because one of them is going to leave and I want the remaining tenants to easily afford the rent. If each one makes 2x the rent, two of them would make a combined income of 4x the rent.

Jake S. · Answer

Hey @Shane Ward If everything else checks out with them but the income is the only issue here. I'd accept them. If both incomes can easily cover the rent, than you should be fine.

Steve Rozenberg · Answer

@Shane Ward

My advice is that you should create your qualifications and stick with them. Do not deviate for the person. This is where it can become a slippery slope with fair housing and discrimination.

A 2 person income I think is fine if they fit the qualifications you require.. either “is”  or “is not” not a gray area.

The more standardized you can become the more it will help you in the long run.

Also make sure that whoever you deny you send them an adverse action denial letter. That is becoming a big deal and violation for people not doing this when renting out their places

David Barnett · Answer

@Shane Ward If I understand the situation correctly, they will be living together in one unit/one house as a roommate situation (since they aren't legally married), and qualify collectively to meet the income to rent ratio.  The property management company that I use counts all tenants over 18 (I think is how they do it) with income and counts it collectively towards the rent/income ratio.  As a landlord, I've approved these types of scenarios, and wouldn't think twice about doing it if everything else checks out.

Michael Noto · Answer

@Shane Ward In a relatively expensive rental market it is rare to have any one person qualify income wise for a 2 or 3 bed on their own. We deal with this all the time when we fill rentals here in CT. In these cases we take the entire households combined rental income into consideration.

How is their credit? if one of their credit scores is above your minimum and one is significantly below I may ask for an additional deposit to cover for the risk of the less desirable tenant profile.

Lastly, I know you probably know this, but make sure both are listed on the lease and explain to them that they are both responsible to make sure the entire rent amount gets paid on time. If the ship goes down, they all go down.

Thomas Cummings · Answer

Agreed with the last two posts

Tenants combined income or each must qualify?

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