In the last month or so I’ve received tenant applicants that would like  to supply their own credit reports? I have always ran their credit report and charged them. I use my own company that I work with. I hate to lose a good applicant because of this, but I’ve also had tenants lose interest when I asked them to supply me with the $35 to run the report.Has anyone had experience with this? Maybe since times are a bit tougher, I can tell them if I accept them as tenants that I will waive the $35 report? Thanks kindly

@Gayle Eisner   I wouldn't trust the report that they provide any more than I would trust a reference letter from a perspective employee that they supplied.  

If they are worried about the $35, you can tell them if everything looks good and they sign the 1 year lease, you will apply a $35 discount to their rent at the end of the year.

It should be a HUGE red flag. Trust your gut.

I will sometimes look at a potential tenant's credit info if they likely won't qualify. I do this to save them the $35 fee. If what I find looks acceptable, I still do the full background credit check that they have to pay for. Do not take shortcuts on tenant screening. ever.

Thank you...that seems like a good idea. I am only renting the home out for three months however (summer) they seem to be in a hurry and  want to pay all three months plus deposit up front.. if so, they can’t afford to have a credit check? They told me it is a hard hit on their credit, is that true? Thanks!

The downside is the possibility they may pull from an agency that isn't reporting derog info that another agency is. I think the upside is that an applicant who knows how to pull their own is likely more financially savvy than the average Joe or Jane, which may indicate less risk of nonpayment. 

I'm looking at income and credit history to determine the risk of tenant defaulting or nonpayment, based on financial agility (DTI, ITR ratio, savings) and health (on-time payments, credit usage).

If they start destroying your house, constant parties, drug growth and or use, many extra occupants and they are paid in full for the Summer you will not get them out.

Its easy to fix a credit report and remove what you want, so do not let them supply a 'special' one.

@Gayle Eisner I much prefer to run credit and BG checks that I organize not ones that are brought to me. I have  found that applicants who want me to hurry or skip steps in the selection process are up to no good. And when they start throwing at me that's pretty much it. On to the next one! BTW Gayle I lived in downtown LG from 1987-2017. We raised our family there, our kids went to all the local schools, it is a really special place. All the best!

@Gayle Eisner It would be SO easy to manipulate/alter a credit report if it’s being brought to you by the applicant. And don’t think an applicant wouldn’t do that.

There’s been plenty of other posts on here about applicants submitting completely fake paystubs, using their friends/family members as landlord and employer references, and all kinds of other tactics to fool landlords and trick their way into homes they otherwise wouldn’t qualify for. 

Stick to your normal screening process and don’t deviate. Better to lose a possibly good tenant then to take shortcuts and end up accepting a bad one. 

@Gayle Eisner They want to pay 3 months up front and can't afford the $35 fee? They are in a hurry yet haven't paid the $35 to get it done and sign the lease??

Anyone trying to pay upfront for months of rent is usually trying to fool the landlord to make them focus on the large payment vs the fact that they will NOT qualify for the rental. Even the most qualified tenants wouldn't pay upfront for a lease!

Also trying to rush the landlord is another tactic. They are trying both on you. 

The reason that  they provide you with a a credit report was probably NOT about saving $35....

The prospective tenants might of not wanted their credit to show a additional inquiry on their credit profile it could have a negative impact on their score. 

Originally posted by @Gayle Eisner :

In the last month or so I’ve received tenant applicants that would like  to supply their own credit reports? I have always ran their credit report and charged them. I use my own company that I work with. I hate to lose a good applicant because of this, but I’ve also had tenants lose interest when I asked them to supply me with the $35 to run the report.Has anyone had experience with this? Maybe since times are a bit tougher, I can tell them if I accept them as tenants that I will waive the $35 report? Thanks kindly

I never charged an application fee or a credit report fee. Apartments here are very competitive and I usually have a dozen applicants, 3 or 4 good ones I want to check out. The danger of running reports for the top picks, then rejecting 3 out of the four would leave 3 angry applicants. I worked in my retirement at a non profit handling with people having trouble with English and had people paying 3 and 4 applicants fees plus 3 or 4 credit report fees, at $50/each and not selected by the landlord. One guy paid $300 in fees and still looking. He thinks it's a ripoff and so do I. In some cases, there are co-applicants, and the fees are doubled. So I advised them if they run across rentals asking for fees, skip it. There are many people under the mistaken impression if they paid the fees, the got the place. Not so.

So if our clients refused paying fees to a landlord, it's not a red flag, it's because we told them so. There's enough rentals around where fees are not charged that they have to go with ones that do.

Yes, there are applicants that have their own copies of reports. I take a quick glance, I tell them, that's great, but if they get selected, I'll get my own to verify.

Originally posted by @Frank Chin :.... One guy paid $300 in fees and still looking. He thinks it's a ripoff and so do I.

As it so happens, vetting an applicant is work, and somebody has to do it. That somebody is probably going to be none too happy about providing that service without some sort of payment.

If you have to provide certain "free" services in order to be competitive in your market, then so be it. That doesn't mean it's a "ripoff".

Originally posted by @Alvin Sylvain :

Originally posted by @Frank Chin:.... One guy paid $300 in fees and still looking. He thinks it's a ripoff and so do I.

As it so happens, vetting an applicant is work, and somebody has to do it. That somebody is probably going to be none too happy about providing that service without some sort of payment.

If you have to provide certain "free" services in order to be competitive in your market, then so be it. That doesn't mean it's a "ripoff".

I talking about landlords that collect application fees, where the applicant in no way qualifies, but pays the fee just to be considered. What work? Put the application in the junk pile?

Yet the same owners never bothered to paint. I do open house showings and often rent it out in one, never more than two showings. And the frequent complaint about many of the properties they checked out were they're not painted or cleaned. One was an exact same property as mine, on the market in the area at the point close to 60 days. When I was rented my place, it was on the market for another 30 days. Rents ran $2,500/month back then and I was at least $5,000 ahead, counting money on hired painters for $1,500, spent 6 hours waiting for people showing up, collected 15 applications, 30 people showing up, reviewed the top 4, and didn't collect any application or credit checking fees. 

In business, you have to consider the pluses and minuses. Can't think the same way as a server in a restaurant where you count the hours you work, and therefore I should be paid so much because I put so many hours in. I often ask people showing up at my open houses what they thought of competing properties, whether they charge any fees, so what I do was the result of my market research, and I never felt short changed. It's not how hard I work, but how smart.

A man seeing 15 - 20 places, pays $20 each for application fees, not totally fluent in English, not considered for any of them, if he doesn't feel ripped off, maybe we can invent another word to express it. It certainly is not the word "happy".

@Gayle Eisner the trouble for some applicants is that landlord accept multiple applicants, rather than first qualified. So these people end up spending $35 over and over, even though they are qualified, someone is "more" qualified. Not only does it cost money, but each pull is a hard pull, so it affects their credit score.

I don't let tenants give me their credit report. The service I use actually has the tenant pull their own credit report and share it with me. The sharing comes directly from the agency. The different is since the tenant pulls it, they don't count it as a hard pull. Also my service charges them $20, so not as much money.

@Gayle Eisner   What everyone else has already said.  I tell an applicant they are welcome to submit their report as part of their application but I will be running my own.

One objection I hear is that the report is a "hard" hit on their credit.  You should verify what your reporting agency is doing.  The reports I use are a "soft" hit, IE it doesn't ding their credit.  When receiving push back, I simply say sorry this is company policy.

I use http://cozy.co/ for credit-background check. I also said if they apply, I would refund the money back from the first month rent. Usually the ones willing to apply have no red flags on them. Other just don't bother , that's a great filter. 

What's funny (not really), is since last year, tenants in the State of New York are ALLOWED to give you their own credit report and, as long as it is less than 30 days old, you as the landlord must accept it.  If they don't have one, you can run one yourself, but (a) you must not charge them an application fee of more than $20 despite the actual cost, and (b) you may not run a report that includes eviction history.  If that's not enough for you, you may not check court records on your own and then deny an applicant based on prior landlord/tenant cases, and you may ask for references, but you may not ask their prior landlords if they paid on time (or several other useful types of questions). 

And now with COVID, the socialist groups are taking advantage and pushing hard for "just cause" evictions to be added to the many tenant protections in this legislative session.

Originally posted by @Frank Chin :

Originally posted by @Alvin Sylvain:

Originally posted by @Frank Chin:.... One guy paid $300 in fees and still looking. He thinks it's a ripoff and so do I.

As it so happens, vetting an applicant is work, and somebody has to do it. That somebody is probably going to be none too happy about providing that service without some sort of payment.

If you have to provide certain "free" services in order to be competitive in your market, then so be it. That doesn't mean it's a "ripoff".

I talking about landlords that collect application fees, where the applicant in no way qualifies, but pays the fee just to be considered. What work? Put the application in the junk pile?

...

A man seeing 15 - 20 places, pays $20 each for application fees, not totally fluent in English, not considered for any of them, if he doesn't feel ripped off, maybe we can invent another word to express it. It certainly is not the word "happy".

I agree that collecting a fee for an applicant you already know doesn't qualify isn't fair. However, I can also see how it may be a legal requirement in some jurisdictions. Not accepting each and every application tendered, regardless of obvious qualification issues, carries the risk of being accused of illegal discrimination.

The person who applies to 20 different places possibly is not doing his own due diligence, and is unknowingly applying to places where he clearly doesn't qualify. There's no way I can know, but I've never as a renter needed to apply to more than three places, and never as a landlord been told by an applicant that I was his 21st attempt.

@Gayle Eisner - I’ve provided my own credit report to many places I’ve rented. But they can also google I went to a prestigious university and my income (job offer letter) was at least 5x the rent.

Especially in times like these it is important to have qualified tenants.  In my opinion, you should stick to your credit, income, and general qualification requirements.  If an applicant in unwilling to spend $35 on a credit check then to me that is a red flag.  Maybe have them sign a qualification acknowledgment before submitting the app.  The qualification acknowledgment form should list your qualification requirements (ex:  no bankruptcy, income requirements, minimum credit score, etc...).

I have noticed that tenants are sometimes hesitant to apply, because they had past experience where landlords indiscriminately processed multiple applications for a single property, only to be rejected because the landlord found a better qualified tenant. These application fees add up for the tenants, when they have to apply for multiple properties given the shortage in my area. 

So we ask all interested prospects to to send us their free credit report and proof of income as part of our pre-screening process. We only do the full screening if the credit and income looks good; otherwise we let them know that they don't qualify. I know this might slow down the process a little, but we have tons of applicants for each property in the DC Metro area, so this is not a major issue. More importantly, I have noticed that tenants appreciate the fact that you are trying not to waste their money, and that is a good start to the relationship if they end up becoming your tenant.  

Thank you all! Yes, I will stick with standard procedure. The last applicants that tried this was a couple. I told them I would run their credit reports anyway. So I did & both their credit scores were in the 500s.   I have other applicants that will let me run credit reports—i is a red flag! 

@Gayle Eisner

I wonder if the are in a hurry due to an ongoing eviction.