If tenants don't qualify, would you accept a foreign co-signer?

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If tenants don't qualify, would you accept a foreign co-signer?

Trevor Levine
Member since 2020 路 22 posts 路 2 votes

Two youngsters want to rent my 1-bedroom furnished apartment. They have little income, but one says her parents are supporting her while she's in college. So I asked if the parents would co-sign.

The parents said Yes, but they are French citizens living in France. I assume they do not have SS#s. If I rent to the kids and they default, and the parents also default, is there any real downside for the parents?

I know I can take the kids to court, and maybe put an unlawful detainer on their credit reports. But would I have any leverage to make the parents pay? Thanks.

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Gail K.
Augusta, GA 路 Member since 2014 路 1k+ posts 路 1k+ votes
5y

So...if your young tenants do not pay (and it almost sounds as if the parents will be paying the rent anyway) do you have any idea how you will get the money out of a couple that live in France?

If it were me I'd walk away from this one.

Gail

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  • Gail K.
    Augusta, GA 路 Member since 2014 路 1k+ posts 路 1k+ votes
    5y

    So...if your young tenants do not pay (and it almost sounds as if the parents will be paying the rent anyway) do you have any idea how you will get the money out of a couple that live in France?

    If it were me I'd walk away from this one.

    Gail

    8Reply
  • Bruce WoodruffPro Member
    Contractor/Investor/Consultant 路 San Diego / Phoenix 路 Member since 2021 路 12k+ posts 路 15k+ votes
    5y

    @Gail K. has it right. Walk away. How the heck are you going to get money out of a French couple....? Unless you could have them deposit cash into an account?

    1Reply
  • Scott M.
    Real Estate Broker 路 Rochester Hills, MI 路 Member since 2009 路 2k+ posts 路 2k+ votes
    5y

    No, I wouldn't.  Hard enough to get funds out of co-signer locally let alone 1/2 way around the world.  

    3Reply
  • David Rogers
    Real Estate Professional 路 Lakewood, OH 路 Member since 2015 路 47 posts 路 19 votes
    5y

    Sounds like a pro tenant scam. Request something like 3 months deposit or find another tenant. I'd lean heavily towards screening a different tenant.

    0Reply
  • Genny Li
    Baltimore, MD 路 Member since 2018 路 431 posts 路 281 votes
    5y

    This is kinda normal for international students.  If they have any hope of immigrating later or renting an apartment later, they're really not likely to not pay unless they flunk out and leave the country.  They can pay just fine through Zelle, BTW.

    3Reply
  • John Teachout
    Rental Property Investor 路 Concord, GA 路 Member since 2015 路 3k+ posts 路 3k+ votes
    5y

    In these crazy days of landlords getting plowed over by government directives, I wouldn't be willing to take on any additional perceived risk. It might be fine but it might not. I'd go with a known.

    1Reply
  • Karla Simmons
    Vacaville, CA 路 Member since 2019 路 218 posts 路 140 votes
    5y

    @Trevor Levine

    I would not do it. Sounds very high risk.

    0Reply
  • Steven Warner
    Member since 2018 路 62 posts 路 50 votes
    5y

    No way!!  The purpose of a co-signor is to guarantee that payment is made.  

    Moreover, a co-signor is signing and allows for you to name them in any suit for non-payment/damage to the property.  If they are out of the country, how are you going to collect on any judgment in your favor? 

    Here, there is a good chance on the "kids" are judgment proof and have no money while the parents are in another country which is more than likely impossible to seek enforcement of the judgment on.   

    While I have allowed a co-signor,  I make sure they qualify and can are actionable for any judgment I may have to enforce.  

    I hope this helps..

    Steve   

    0Reply
  • Trevor Levine
    OP
    Member since 2020 路 22 posts 路 2 votes
    5y

    Wow, I really appreciate all of your replies. Thanks a million! Yes, maybe I will have to ask that they pay rent for the entire 8 months upfront. 

    2Reply
  • Kar Sun
    Member since 2021 路 388 posts 路 277 votes
    5y

    I would allow one co-cosigner, but not a cosigner for every tenant. Even if a cosigner lives in states it its still challeging to get money from them especially if they are out of state. think of the attorney fees, and potentially hiring an attorney not only where you live but also in the state where these cosigners live. How are you planning to the money from the cosigners in France? I would let these tenants be someone else's problem. A definite NO for me. I also would not accept 8 months prepayment. 

    0Reply
  • Bruce WoodruffPro Member
    Contractor/Investor/Consultant 路 San Diego / Phoenix 路 Member since 2021 路 12k+ posts 路 15k+ votes
    5y
    Originally posted by @Trevor Levine:

    Wow, I really appreciate all of your replies. Thanks a million! Yes, maybe I will have to ask that they pay rent for the entire 8 months upfront. 

     I don't think you listened well enough.....walk away from these people! Can you really not find other renters in this market?  

    1Reply
  • Kar Sun
    Member since 2021 路 388 posts 路 277 votes
    5y
    Originally posted by @Bruce Woodruff:
    Originally posted by @Trevor Levine:

    Wow, I really appreciate all of your replies. Thanks a million! Yes, maybe I will have to ask that they pay rent for the entire 8 months upfront. 

     I don't think you listened well enough.....walk away from these people! Can you really not find other renters in this market?  

    I will be honest. Good renters are very tough to find nowdays.Luckily my property has seen a tremendous appreciation and I am able to cover the mortgage on it now. Maybe if I was renting C,D,F class property I would find someone quicker. But for an A and B class I have a small room to make a mistake. And I really do not want to deal with the tenants that are best match for C,D,F class properties.

    0Reply
  • Eric Gerakos
    Investor 路 Costa Mesa, CA 路 Member since 2016 路 1k+ posts 路 1k+ votes
    5y

    Don't walk away. Run.

    1Reply
  • Jay HinrichsBusiness Member
    Real Estate Consultant 路 Summerlin, NV 路 Member since 2014 路 45k+ posts 路 66k+ votes
    5y
    Originally posted by @Eric Gerakos:

    Don't walk away. Run.

    Yup foreigners are noncollectable in this scenario  at least at that dollar level.  there is a reason Clayton Morris moved to Portugal.

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    2Reply
  • Account Closed
    Rental Property Investor 路 Savannah, GA 路 Member since 2014 路 298 posts 路 67 votes
    5y

    I would definitely rent to two French college students whose parents agree to co-sign.  I鈥檓 so thankful for the Swiss landlords who rented to me when I was a college student in Switzerland.

    0Reply
  • Jeff S.
    Specialist 路 Portland, OR 路 Member since 2010 路 3k+ posts 路 1k+ votes
    5y

    @Trevor Levine when you have a cosigner you need to qualify them by running credit just like you do a tenant. That would be hard. You can't be flexible about that. These kids need to have some kind of credit card or something. I would skip the cosign and have them show proof of income from the parents then a huge deposit. I would also check on the laws for evicting a non US citizen. It could be a scam and if you are soft and they get in you get have huge problems. if you have to ask here maybe not a good idea for you.

    0Reply
  • Bruce WoodruffPro Member
    Contractor/Investor/Consultant 路 San Diego / Phoenix 路 Member since 2021 路 12k+ posts 路 15k+ votes
    5y
    Originally posted by @Account Closed:

    I would definitely rent to two French college students whose parents agree to co-sign.  I鈥檓 so thankful for the Swiss landlords who rented to me when I was a college student in Switzerland.

    1) Do you currently or have you in the past rented to foreign students? 

    2) If he cannot collect from them or their parents, will you agree to reimburse him?

    0Reply
  • Khoi Le
    Member since 2020 路 22 posts 路 25 votes
    5y

    Get the entire rent up front.

    1Reply
  • Ab Basu
    VA 路 Member since 2015 路 4 posts 路 2 votes
    5y

    Before immigrating here I was an international student and found that in the college town where I lived the landlords were used to and understood our unique situation. They asked for more deposit or other ways to reduce the risks. Would a transcript that shows a responsible GPA or a letter from the parent's foreign bank perhaps help you? It was years ago for me but my dad's bank provided a certified letter attesting to his having enough funds to cover a year of my rent. Also, remember that foreign students have much higher and different hoops to go through from domestic - just to get a student visa, they have to show they have been accepted to the university, and full documentation to the US government that their source of funds is at a minimum enough to pay for roundtrip airfare, the out of state fees for a year, plus lodging and food/health insurance and then some. They also have to have in person interviews with the US embassy with all the certified documentation. So, yes, they can skip on you but there are ways to reduce the risk.

    As an aside, I have a friend who is an investor in student housing - he finds that most of their renters are guaranteed by their parents and he has few problems. That said, it is easy for a foreign student to skip out on you with no way for you to collect unless they wish to immigrate at some point. 

    0Reply
  • Francois G.
    Real Estate Agent 路 New York, NY 路 Member since 2020 路 62 posts 路 72 votes
    5y
    Originally posted by @Trevor Levine:

    Two youngsters want to rent my 1-bedroom furnished apartment. They have little income, but one says her parents are supporting her while she's in college. So I asked if the parents would co-sign.

    The parents said Yes, but they are French citizens living in France. I assume they do not have SS#s. If I rent to the kids and they default, and the parents also default, is there any real downside for the parents?

    I know I can take the kids to court, and maybe put an unlawful detainer on their credit reports. But would I have any leverage to make the parents pay? Thanks.

    Choose your battles wisely in this situation. 

    I'm in Manhattan where this is very common for international students and most landlords won't bother unless you have a guarantor who lives in New York State (few are open to guarantors living in the tri-state). If this doesn't work, they'll accept third-party guarantors like Rhino or Insurent. Worst case scenario, they have the tenant pay the full year lease in cash in advance, at the very minimum 3 months upfront (on top of the deposit and 1st month).

    You're the landlord in this situation so it's your decision to make but it's going to be extremely difficult getting people across the world to pay back rent for their child should the situation go south at all. You will have very little leverage and the cost/time the whole process will take you should make you at least reconsider. It would be a hard no for me personally.

    Good luck on your decision.

    0Reply
  • Sam Exum
    Investor 路 Salisbury, NC 路 Member since 2015 路 3 posts 路 3 votes
    5y

    @Trevor Levine My college roommate was from the Bahamas. His parents always took care of our bills.

    2Reply
  • Sam Exum
    Investor 路 Salisbury, NC 路 Member since 2015 路 3 posts 路 3 votes
    5y

    @Ab Basu 馃憤馃従

    0Reply
  • Phil LoCicero
    Member since 2018 路 40 posts 路 41 votes
    5y

    I only accept co-signers who own property in my state 

    0Reply
  • David Avetisyan
    Rental Property Investor 路 Glendale, CA 路 Member since 2013 路 685 posts 路 334 votes
    5y

    Having the parents co-sign would be good for nothing.

    You can consider a far larger security deposit just to cover yourself in the event things go south.

    To your success!

    0Reply
  • Genny Li
    Baltimore, MD 路 Member since 2018 路 431 posts 路 281 votes
    5y
    Originally posted by @Trevor Levine:

    Wow, I really appreciate all of your replies. Thanks a million! Yes, maybe I will have to ask that they pay rent for the entire 8 months upfront. 

     I have an "in" with the university, as my mother is able to look up anyone to see if they're an active student. :) She's retired staff and still has all the privileges. 

    0Reply
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