Is This An Undercover Co-Signer Attempt

46 Replies

I have had a young couple apply for my 2bed 1bath apartment in my multiunit. The girlfriend is unemployed and stays home looking after the couples 1 year only son. Her credit score is 522.

The boyfriend has a 615 credit score and has had a job since April 2019 working at the same company his father manages. He is only bringing in about $2,500/mo. He and his girlfriend alone do not meat the income requirement for this rental, as it is $1,075/mo +$1,075 security deposit.

This is where it gets interesting:

The boyfriends father also filled out an application to be a co-applicant. Under reasons for moving he has: "This is my first time renting. I own a house in Heber, CA, but due to a change in my personal circumstances I will be moving out." (mind you, everyone applying here currently lives together). His credit score is 776, no total debt, and is bringing in about $4,500/mo. He said that he would be able to afford the mortgage on his current home and the rent required at the rental property, because he says his wife pays a portion of the mortgage too.

Upon conduction a walkthrough of the property, I was told last minute that the father could not make it (so now it is just the couple and their child). I told them that they could do the walkthrough, but if I haven’t rented out the property yet and the father still wanted to see it himself, that he would be welcome to schedule a viewing. The girl friend said that the father if very busy and travels at least 6 months out of the year and wouldn’t be here at the property often.

For me, red flags seem to be popping up all over the place. Are they attempting to use the father as an undercover co-signer and should I decline the application? and if so, on what grounds can I do this?

This is my husband and I's first time renting to people, as we are first time landlords. Any and all advise is welcome. Thanks

What is father's mortgage taxes, insurance HOA? Take that out of the $4500 can he make it alone? My thought is pass

I'm sorry, but is there any reason you don't want him on the lease or being used as a co-signer @Iesha Padilla ? If yes, then be worried. If no, then proceed as you normally would. 

Thanks Filipe, 

We are new to renting and being landlords, so we just don't want to be having to chase down the established tenant on the lease, in the event that the others end up not being able to pay rent. 

I just don't think that they are being transparent with their intentions. And if in the end that will come to bit us in the butt.  

Originally posted by @Filipe Pereira :

I'm sorry, but is there any reason you don't want him on the lease or being used as a co-signer @Iesha Padilla? If yes, then be worried. If no, then proceed as you normally would. 

Thanks Filipe,

We are new to renting and being landlords, so we just don't want to be having to chase down the established tenant on the lease, in the event that the others end up not being able to pay rent.

I just don't think that they are being transparent with their intentions. And if in the end that will come to bit us in the butt.

 

@Iesha Padilla  Where are you in the process?  Do you have a fully-executed lease, or was the walkthrough simply showing them the unit?  What is your legal responsibility if you decline to rent to them at this point?  Just trying to get more info here....

Originally posted by @Dan Schwartz :

@Iesha Padilla Where are you in the process?  Do you have a fully-executed lease, or was the walkthrough simply showing them the unit?  What is your legal responsibility if you decline to rent to them at this point?  Just trying to get more info here....

There was just a walkthrough. I don't have any legal responsibilities to the applicants at all. I conduct a pre-screening phone interview with all applicants after reviewing their application (background check is clear and all). Then, if everything or most important things check out, then I invite them to do a walkthrough of the unit (this is typically when I am able to put eyes on the applicants and interact with them), and you'd be surprised at all of the added information that you didn't ask for (but maybe should have asked for) starts flowing out.  

 

@Iesha Padilla good.  Whew.  It appears to me that these applicants don’t meet your income criteria.  Always be careful that you don’t say (verbally or in writing) any more than you have to. I would continue your search.  The father has presented himself as a co-applicant and resident, yet you have now found out that he will rarely be at the property. Chances are he will never be at the property. You didn’t agree to add a cosigner, you agreed to add a co-applicant and a resident.   Thank them for their time in coming to the walk-through, and take some more applications.  This will hardly be the last applicant that you have to disappoint.

Originally posted by @Dan Schwartz :

@Iesha Padilla good.  Whew.  It appears to me that these applicants don’t meet your income criteria.  Always be careful that you don’t say (verbally or in writing) any more than you have to. I would continue your search.  The father has presented himself as a co-applicant and resident, yet you have now found out that he will rarely be at the property. Chances are he will never be at the property. You didn’t agree to add a cosigner, you agreed to add a co-applicant and a resident.   Thank them for their time in coming to the walk-through, and take some more applications.  This will hardly be the last applicant that you have to disappoint.

Thank you very much for your insight. I appreciate all of the helpful advice. 

 

@Iesha Padilla You are right to have reservations about this group. If the father is 'too busy' to take a look at the property he may be too busy to pay rent as well, and he is the only qualified applicant in the bunch. They could be legit but it sounds complicated even if they are on the level. The house in Heber may be real, or not, and that is verifiable from the county tax records probably on line, you might take that additional step if you choose to proceed. 

I was in the exact same situation a few years ago. Tenants did stop paying, and I ended up evicting them. Got the judgment, and attached the wages of the one person with good credit score (never lived in the property as far as I can tell). It took 9 months, but I got all that was owed to me from that wage garnishment, interest included. Just saying. 

In general, having a solid co-signer--or even better a guarantor-- is better than not having one, but none of this seems great. Pass. A co-signer has some rights to communication etc but a guarantor is just putting their money and credit on the line to support the applicant.

Originally posted by @Jonathan R McLaughlin :

In general, having a solid co-signer--or even better a guarantor-- is better than not having one, but none of this seems great. Pass. A co-signer has some rights to communication etc but a guarantor is just putting their money and credit on the line to support the applicant.

Thanks for the feedback. 

 

Originally posted by @Iesha Padilla :


...

For me, red flags seem to be popping up all over the place. Are they attempting to use the father as an undercover co-signer and should I decline the application? and if so, on what grounds can I do this?

This is my husband and I's first time renting to people, as we are first time landlords. Any and all advise is welcome. Thanks

I love that you're recognizing the red flags. I see a lot of them as well.

I would sit down with your husband and write out criteria for who you will rent to.
Minimum credit score (650is a number I see frequently)
Minimum income (3X rent, verifiable by check stubs and a call to HR) 
Maximum number of tenants in the unit (most places state 2 per person, plus one additional person)
Pets (yes or no. Deposit or fee? A deposit is refundable, a fee is not)
Past Evictions? (some states do not allow you to screen for past evictions, learn your landlord tenant laws)
Criminal History? (Again, some states do not allow you to screen for criminal history.)
Landlord Referral (not the current landlord, the one before that. If they won't answer, that's an answer itself.)

Please note that you cannot discriminate against any number of reasons that are found in fair housing, including familial status, race, gender, sexual orientation among many others.

Write out your criteria and do not deviate from it. So many new landlords will let their criteria down a little for someone. Don't be tempted. It never ends well. I've heard countless stories of landlords who say "My worst experience with a tenant was when I made an exception.

Screen over the phone before giving the address and setting up a showing. If they don't meet your criteria, then they don't get the information. 

If you catch them in ANY lies, they are out. 

Get yourself a rock solid lease. 

Never accept partial rent payments or partial deposits. You want tenants who can easily afford the property, not excuses for why their rent is late.

If I had multiple applications I would pass


if not I would say WOW you are so close but not quite. However if you would like to put up an additional month for security deposit I can make it work 

Originally posted by @Mindy Jensen :
Originally posted by @Iesha Padilla:


...

For me, red flags seem to be popping up all over the place. Are they attempting to use the father as an undercover co-signer and should I decline the application? and if so, on what grounds can I do this?

This is my husband and I's first time renting to people, as we are first time landlords. Any and all advise is welcome. Thanks

I love that you're recognizing the red flags. I see a lot of them as well.

I would sit down with your husband and write out criteria for who you will rent to.
Minimum credit score (650is a number I see frequently)
Minimum income (3X rent, verifiable by check stubs and a call to HR) 
Maximum number of tenants in the unit (most places state 2 per person, plus one additional person)
Pets (yes or no. Deposit or fee? A deposit is refundable, a fee is not)
Past Evictions? (some states do not allow you to screen for past evictions, learn your landlord tenant laws)
Criminal History? (Again, some states do not allow you to screen for criminal history.)
Landlord Referral (not the current landlord, the one before that. If they won't answer, that's an answer itself.)

Please note that you cannot discriminate against any number of reasons that are found in fair housing, including familial status, race, gender, sexual orientation among many others.

Write out your criteria and do not deviate from it. So many new landlords will let their criteria down a little for someone. Don't be tempted. It never ends well. I've heard countless stories of landlords who say "My worst experience with a tenant was when I made an exception.

Screen over the phone before giving the address and setting up a showing. If they don't meet your criteria, then they don't get the information. 

If you catch them in ANY lies, they are out. 

Get yourself a rock solid lease. 

Never accept partial rent payments or partial deposits. You want tenants who can easily afford the property, not excuses for why their rent is late.

Wow! What a wealth of information. And thank you! 

I wonder why you are screening (and charging them?) before they have seen the unit 

people do get busy for work and do travel. That does not bother me per se. 

also there is nothing wrong with co signers. 

If I were you I would Read the local tenant/landlord law and then create your screening criteria. Then stick to it 
you might look into local rental owner associatjons as they will have model screening criteria you might be able to use 


Originally posted by @Michael Plante :

If I had multiple applications I would pass


if not I would say WOW you are so close but not quite. However if you would like to put up an additional month for security deposit I can make it work 

Nice. I hadn't thought of that either. Thanks 

Originally posted by @Mary M. :

I wonder why you are screening (and charging them?) before they have seen the unit 

people do get busy for work and do travel. That does not bother me per se. 

also there is nothing wrong with co signers. 

If I were you I would Read the local tenant/landlord law and then create your screening criteria. Then stick to it 
you might look into local rental owner associatjons as they will have model screening criteria you might be able to use 

Hello Mary,

I am not screening and charging people. I use apartments.com and Zillow.com as a means for interested parties to apply directly. When they apply, they are will aware that there is an application fee through those platforms for applying. 

I can then screen all candidates against all that they have SELF-REPORTED on their applications. If things don't add up, matchup, they don't meet the income threshold, background check doesn't check out, or there is unwillingness to be forthcoming on even the most basic of information, then I don't extend and invitation to tour the property. I do this because I do have other tenants with their families residing here and I don't want anyone coming to the property that could ever pose a security risk to them. 

I'm just not sure where you might be getting that I screen and charge anyone. Please clarify...

Thanks  

 

I had to go read how zillow and apartments.com work for prescreening.  My concern is that quality tenants wont want to pay to view but this may be a regional thing. 

I understand your concern re current tenants and you can easily "pre screen" by just talking to the individuals and/or sending them your screening criteria and asking them if the pass the quick pre screening. 

FWIW i dont use either service for applications/screening just advertising my vacancies.