Real Estate Broker · Johns Creek, GA · Member since 2009 · 870 posts · 664 votes
This is the first time listing the rental property as an agent representing myself. I almost went through an eviction on my last property in Chicago and wanted to be extremely cautious when screening a prospective tenant for my new rental property.
I had a situation where a tenant was upset at me for asking her to go through the smartmove.com process. She told me that the process was too exhaustive and I guess this really turned her off. Anyone else have a similar situation when screening tenants?
She made only $35,000 a year, but had a perfect 800 credit score and just had her personal residence with 30% equity under contract.
I started the process of asking for 2 bank statement and 2 paystubs. Everything went smoothly until i asked her to pay for the credit process through smartmove.com and this turned her off enought to find another property.
Where did i do wrong? I would appreciate any advice in proper screening.
BTW - I started putting all my requirements in writing and giving that to the prospective tenants upfront, to serve as a filter. Either hard copy or electronic - doesn't matter to me. I've still had some with criminal records applying (and being declined), but they can't say they weren't made aware ...
James - I'd be interested in finding out what turned her off more specifically. It sounds to me like this tenant felt that they had good credit, so she shouldn't have to go through a rigorous screening, but I'm just speculating here.
Without more information, it is hard to say. I'm guessing that regardless of who you used to screen her, she may have been turned off.
I guess that's the question.
And, if that's the case, then I'm guessing you may not have wanted her as a tenant.
What I've found is that tenants that are high quality tend to be easy to work with and have little issue going through proper screening. On the other hand, those that may have something to hide get aggravated by thorough screening.
I haven't seen smart move to know if it is a chore to fill out but our applicants are told about the app fee right away and if they don't want to fill out an app online, we always offer a paper app. As far as the fee goes, if they don't pay application, we don't even look at them. Understandably, some folks don't like putting credit cards on the internet so there is always this cool old school option, cash. Make sense or help?
I tend to also think she probably would have left either way or she might have been hiding something. Like Tiger M. said, I'd make sure you let everyone know up front what the application process looks like - from beginning to end.
I use smartmove for screening my tenants. I have had several applicants have some trouble with the screening process, but everyone who has been interested in the property has been able to finish the screening. It is not the easiest system, but it is inexpensive and there is a customer service number the applicants can call for assistance.
(my posts keep getting deleted for some reason hmmmm)
I don't think you did anything at all wrong, some people just take things differently. I would expect you to do some sort of credit check on me and would have been much happier using something like smartmove. Opposite of your applicant I wouldn't have given you any bank statements and would have walked if you required it.
I think there is more to the story and you are probably better not having her as a renter. This is pretty common practice so I think you are well within your right to protect your property and who you are renting it to. She sounds like she might have been high maintenance.
From my experience, my best tenants are actual greatful that I'm doing a background check. It lets them know I'm not a slumlord, I'm actually taking care of my property. In fact, my latest tenant was debating between three properties and chose mine BECAUSE I did a thorough screening on her and the others didn't. She has been a perfect tenant so far.
It sounds like you were asking for things piecemeal. First you want some statements; you receive those and ask for something more. You receive that something more and ask for SmartMove application and fee. Explain everything that you will be asking for right upfront, so that the ones who are afraid of being screened move along to some landlord who doesn't care about screening. And then the ones who are still interested know that you will expect to receive the items you already explained - they will know that there is an application, an application fee, some background checks, employment verification, landlord verification, etc. I wholeheartedly agree with Joshua Dorkin's statement:
Originally posted by Joshua Dorkin:
... high quality tend to be easy to work with and have little issue going through proper screening. On the other hand, those that may have something to hide get aggravated by thorough screening.
...
BTW - I started putting all my requirements in writing and giving that to the prospective tenants upfront, to serve as a filter. Either hard copy or electronic - doesn't matter to me. I've still had some with criminal records applying (and being declined), but they can't say they weren't made aware ...
BTW - I started putting all my requirements in writing and giving that to the prospective tenants upfront, to serve as a filter. Either hard copy or electronic - doesn't matter to me. I've still had some with criminal records applying (and being declined), but they can't say they weren't made aware ...
I also do this. I put a cover page on my rental app with some facts about the property, as well as my requirements and the application process. I find that it answers most questions and makes it crystal clear up front what I'm looking for (and what I'm not).
I hand over a 4 page document:
Page 1) Standards for approval
Page 2) Application
Page 3) 1 months rent verbiage
Page 4) Credit pull authorization
With the $35/app fee per 18+ year old, they also need a money order for 1 months rent. If approved, the 1 months becomes their deposit. If denied, they get their 1 months back. If they are approved, and back out, they forfeit the 1 months rent.
Hi Joshua, I think after my last tenant experience where my wife and I had many sleepless nights, I became a little too cautious.
The prospective tenant had a 800 credit score and she really liked my property and was willing to $1645, and i told her that there were two more candidiates coming to look at the property and I can tell she was disappointed. Had i taken her right then and there, i would of had her.
When i found out that the other two candididates were not a good fit, I came back to the her to go through the smartmove.com. She asked me, "I am paying for this?" After the smartmove process, she was very annoyed and texted me, "I don't understand why i am putting her through such a rigorous process." After that she leased from someone else.
What are some processes you guys have taken to secure a good tenant? Is it a standard procedure to ask for 2 bank statements and 2 pay stubs. Asking for this also annoyed several of my prospective tenants as they felt that this information was very sensitive.
How should i proceed in screening my next prospective tenants?
Originally posted by Joshua Dorkin:
James- I'd be interested in finding out what turned her off more specifically. It sounds to me like this tenant felt that they had good credit, so she shouldn't have to go through a rigorous screening, but I'm just speculating here.
Without more information, it is hard to say. I'm guessing that regardless of who you used to screen her,
I guess that's the question.
And, if that's the case, then I'm guessing you may not have wanted her as a tenant.
What I've found is that tenants that are high quality tend to be easy to work with and have little issue going through proper screening. On the other hand, those that may have something to hide get aggravated by thorough screening.
Some don't have bank accounts, so asking for non-existent bank statements is definitely going to drive those away; so if you want that, keep asking for them, but if you want to deal with ones without bank accounts ...
800 credit score is almost not good for the rental business, because somebody like that can be buying a house sooner than the 600 credit score tenant. But the score number in itself is almost meaningless for rentals; people with bad scores are sometimes excellent at paying rent (just poor at paying for other things, or they have medical collections or student loans in collection).
If someone can't complete your simple application, do you really want them as a tenant anyway?
Did she say she had a 800 credit score? Unless you saw it, I would assume she was hiding something on her credit.
I've been asked to fill out more than what you asked to live somewhere. Asking for smartmove.com isn't asking too much. I rarely was asked for pay stubs/etc. as a tenant. I'm not sure if I ever was, in fact. But, if someone wants to come into YOUR home, they shouldn't mind basic tasks like this.
If they won't follow a simple screening process, let them go. They're probably hiding something, or petty/arrogant and feel above the process. It's not like you're asking for a full background check, tons of references, etc. It's a credit check. I bet she was hiding something. Who knows if she really was in the "upside" on her house or not. Could have been a foreclosure or short sale.
If she says "am I paying for this," she just sounds annoying. Be glad she didn't move into your house, she sounds like a PITA. If she can't afford a $35 credit check, how can she cough up $1600 in rent?
I would screen with SmartMove and check rental references/credit.
I don't think I would ask for pay stubs and bank statements. Someone making great money today could be fired tomorrow, and someone making great money may pay everything but their rent. I would check references and search local court records for collections/evictions on your own (without requesting it from them) instead. It's reasonable to ask for pay stubs/bank statements, but SmartMove and verifying job/credit/rental references should be enough... in my opinion.
Also, I would not say "well, I'm showing it to 2 other people..."
Just hand her an application. Tell her to take it home, fill it out, and bring it back. If you get multiple applications, figure out how you want to screen them and choose a candidate. Have set standards of what applications you approve.
Remember....
A tenant who can't be "bothered" by an average screening process and gets annoyed from the start is going to be a tenant who gets annoyed and whines about EVERYTHING later on.
Remember....
By letting someone move into your home, you're doing them a favor by giving them a nice place to live. They're paying for the privilege, but you have the right to have reasonable screening to protect your house.
You can avoid all the miscommunication by telling them your screening process up front. It is normal for a tenant to pay for a credit report, although in NH we can't have an application fee. But a credit report payment, yes.
Applicants self-screen if they won't go through the process. Saves me all that work and hassle. Whenever I have made exceptions to my process, I'm always sorry later. The good tenants are happy that I am screening and are eager to meet my requirements, to get into a building where everyone else has met the same requirements. If it's a single family house, a defined screening process indicates that you are a responsible business person, which tells the tenant two things:
1. That you will be responsive to repair requests and maintenance issues because you are a responsible business person
2. That you won't put up with drama and excuses because you operate as a business.
Nice to see you again, I remember the issues you went through with your eviction which you posted about some time back...
I haven't been doing this that long, but the people I've had balk at proper screening are the ones who have something to hide. Although usually they just lie on their app and hope you don't check things out. The one group I've had with high FICO scores were very organized, never any problem.
Hey guys,
I am meeting a prospective tenant today at 1pm. The significant other and two daughter threw me off from her email.
How can i handle a situation where another significant other may come along later. Is this acceptable? This is 4bed/ 2.5... and I am not sure about 6 people living in there.
Should i be open minded?
Prospective tenant's email.
Thanks James! I look forward to meeting you! I have two children, a 16 y.o. daughter and a 12 y.o. son. If I find the right home, my significant other and his two daughters, age 9 and 13, would also be part of that equation. We are definitely a nice, young long term family unit! :)
Hey guys,
I am meeting a prospective tenant today at 1pm. The significant other and two daughter threw me off from her email.
How can i handle a situation where another significant other may come along later. Is this acceptable? This is 4bed/ 2.5... and I am not sure about 6 people living in there.
Should i be open minded?
Prospective tenant's email.
Thanks James! I look forward to meeting you! I have two children, a 16 y.o. daughter and a 12 y.o. son. If I find the right home, my significant other and his two daughters, age 9 and 13, would also be part of that equation. We are definitely a nice, young long term family unit! :)
The house sounds large enough--2 per bedroom is usually the guideline people use.
I would try to get all the adults (including significant other) to sign the lease now, and identify on the lease all the names of the people who will be living there so that they don't try to bring in extra people beyond the six mentioned.
Also, are they both income earners, or just one? If the significant other is the main breadwinner and that person decides not to move in later, you could have a problem.
My ideal tenant would be a married couple with 2-3 young children. It appears that two families are coming together which can complicate things. Any of you had a similar experience?
I much rather keep the home vacant for 3 months than to compromise. I am unsure when but I know the home will eventually get rented due to the school district.
call me crazy but I require last paystub, last year's W2, last 6 months proof of rent paid (tenants can give a false # for a landlord & have their buddy verify), & last month's paid utility bills.
I am also going to start requiring visiting their current place of residence.
As we all know, if/when they get a mortgage, they will be providing much much more documentaion.
Did you charge her an application fee, and then ask her to pay for SmartMove? Just curious since you mentioned she was turned off by the fee.
I had a couple who used SmartMove and were fine with it. But I charged them $35/adult to start with as the application fee, and paid for the screening myself. I asked for the application, application fee, proof of income all in one shot and ran the credit checks as soon as I got the money, not going back and forth.
However, I ended up creating an account with CitiCredit.net and used that service instead of SmartMove because it's a lot easier on our side since we don't have to wait on the tenants to fill things out.
Good luck on your new prospect. Four teenagers seem like a stretch, but if it were me, I'd collect everything on the 2 adults, including the application fees, run their credit reports, and decide from there.