Investor · Suwanee, GA · Member since 2013 · 251 posts · 30 votes
Hello. I have a question. I have a client who’s looking for a 2 or 3 bedroom home to rent in the Metro Atlanta, Georgia area. She’s looking to purchase but wants to wait it out for a while to see how the market goes. In the meantime she’s willing to pay either a 6 or 12 month lease all upfront ($1200/month).
How do I find a landlord willing to accept these terms???
Hello. I have a question. I have a client who’s looking for a 2 or 3 bedroom home to rent in the Metro Atlanta, Georgia area. She’s looking to purchase but wants to wait it out for a while to see how the market goes. In the meantime she’s willing to pay either a 6 or 12 month lease all upfront ($1200/month).
How do I find a landlord willing to accept these terms???
Why would a landlord have to accept those terms? My question would be, why doesn't she qualify without having to offer that? And if she doesn't, then why would I want her?
I know this woman personally. She’s not trying to get around any qualifications. She’s willing to complete an app, etc. This is a legit tenant. I remember when I first started out as a real Estate wholesaler and I paid a landlord upfront for the full year because I used to earn money in chunks and it was easier for me to get priorities out the way in that way and because my income wasn’t consistent.
One thing for renter or landlord to be aware of in this type of situation is, what happens if the lease ends early for any reason, let's say for discussion sake the house is haunted :)
If you are the renter and have paid 6-12 months upfront, good luck getting your money back. If you are the landlord and you want to let the person out of the lease but have spent the money you now have a conundrum.
This occasionally happens in the PM business and we hold the money and pay the owners the correct amount each month. I most often see it when we have students or diplomats from overseas that do not have SSN's and offer to pay upfront to secure a property.
Best of luck to your friend in search of a new home, I hope she finds exactly what she is looking for.
In addition to what @Chris London said, in some states you aren't even allowed to deposit those funds until they month hits. I.e. even if she pays Jan, Feb and March up front, you can't cash Jan's rent until 1/1, Feb's rent until 2/1, etc.
I guess what I am trying to say is that as a landlord & property manager if a tenant were interested in doing that for one of our CT rentals, it wouldn't carry too much weight for me, personally. Mostly because rent isn't paid until we receive it, and if it isn't deposited (because legally it cant' be) then it's about as good as not having received it at all.
Just thinking outside of the box here - maybe one option to avoid this issue would be to set up an escrow account, and have the tenant sign off on something in addition to the lease acknowledging what the funds are for.
There's no way I would ever accept "prepaid" rent, lots of reasons. For one, it's a huge red flag- why would a tenant want to pay rent up front? Terrible credit? Money laundering? No one else wants them?
Second, if you accept a year of rent up front and something else goes wrong- they violate your lease in another way and you need to evict, you can create a really terrible situation for yourself, especially if you are in a tenant friendly area. A judge who has sympathy for the tenant and knows they've already paid you rent for the rest of the year is not likely to rule in your favor.
@Rashad S. typically when a person says they are willing to pay upfront rent for a year, the idea they are conveying is that they have the money to pay rent even if income stream is minimal. If credit score is decent, rent history of having paid on time or mortgage history (if home owner), account showing decent deposits ( esp since she is planning to buy a home later) and willing to a two months security deposit may be a better way to present the client/ family friend as a tenant. My 2 cents.
@Rashad S.. As a private landlord, I would want to hear from you "why", first and foremost. Second, I would want you to explain to me that she is elderly and disabled and would just prefer to handle the business transaction all at once (if that is what I read correctly here). Third, you should explain to the landlord that in no way are you asking them to change their criteria for her to qualify as a tenant. Fourth, I would still certainly want to meet with the applicant and you, and verify everything that you have told me. And fifth, of course, I will be doing verification and qualify her like I always do for any applicants.
And after all that, I would probably explain to her that paying more than one month at a time is not necessary, nor is it required.
I have had multiple students or their parents prepay rent in our student rentals. Sometimes coincides with student loan money or scholarships being funded or in several cases just independently wealthy parents that just didn’t want to deal with payments. They likely made one payment to the university for tuition and fees and then another to us for about a semesters worth of rent payments. All tenants had co-signers who were fully vetted and credit checked.
I'd rather have a tenant who was capable of putting the money in a bank account and setting up automatic payments, if they didn't want to remember rent every month. Someone who isn't capable of dealing with monthly bills isn't someone I'd want to rent to. To me, this smacks of someone who also won't call me if the sink is leaking or otherwise just be responsible.
I just learned that making exceptions for a tenant who didn't want to do things the normal way just ended up being a high-maintenance or problem tenant one way or another.