Guilderland, NY · Member since 2011 · 25 posts · 2 votes
Hi Guys,
We have agreed on a purchase price for a two family house in a college rental area and if the inspections goes well we will be buying our first investment property. I wanted to know if any of you have parents co-sign a lease (these are all college kids). The reason I ask this is when we were looking at properties one of the owners said she insists on parents also co-signing leases for their kids. I have not heard of this and wanted to know how you guys do it.
Rental Property Investor · Tulsa, OK · Member since 2012 · 291 posts · 102 votes
13y
I would be careful on how one approaches it, but in my experience you can usually use the lack of credit history as a basis to justify co-signing. By holding the parents accountable, you ensure a little more influence on the responsibility of lease agreements that college students normally would not.
One college town I lived in I signed my own leases and gave deposits. They asked for income check, no credit check. Trusting.
Another city I lived in, we had to show substantial income and credit history. That made most college students' parents co-sign. I think the minimum income required was $60,000 or $70,000 to rent a studio apartment there. They also checked my references, plus my parents income and credit. I had to send my parents tax statements in, too. Plus, deposit was 1 months rent. That meant a few grand upfront. I was pretty careful with that place!
I would at least credit, reference, and income check the student. If they don't meet your pre-set income requirement or credit score, they need a co-signer (most will ask their parents to co-sign).
Real Estate Investor · Audubon, PA · Member since 2009 · 13k+ posts · 8k+ votes
13y
As Jon K. pointed out, you have to check out the co-signers too. If the co-signer doesn't make enough income or is a deadbeat, you won't be able to collect from them - so their signing is basically worthless (you can get a judgment against them that they won't pay anyway - that's about all you'll end up with).
Real Estate Agent · Virginia Beach, VA · Member since 2012 · 2k+ posts · 1k+ votes
13y
In rare instances, the student makes enough to qualify on their own. Usually not. Coming from the other side, as a parent of a college student, we had to co-sign my daughter's freshman & sophomore year apartment. From the parent's perspective, it's a nightmare as they end up hating their roommate or want to move or the roommate drops out, etc, and you're still liable. From a landlord perspective, I wouldn't think of renting to a college student without a parent cosigning for exactly the same reasons.