Should I have STR guests (via Airbnb) complete a rental application

Should I have STR guests (via Airbnb) complete a rental application

Rental Property Investor · Chicago · Member since 2022 · 20 posts · 7 votes

Hey y’all! 

Since listing my basement unit on Airbnb for stays 32+ days, I’ve gotten a few hits. Some of the leads have seemed very scammy - imagine someone willing to pay $22,000 for six months? Not me! But it’s happened - I ultimately deemed it not a good fit because the message exchange got weird. 

I have another request now from a mother/daughter duo that’s looking for a 3-6 month stay while they house hunt. So far, the only red flag is the cat they’d like to bring (and I don’t really allow pets), but it’s the mothers emotional support animal. They also have a move in date of 3/19 - this weekend, seems kind short notice for such an expensive stay ($15k) - so maybe another red flag. But, they want to bring furniture - and that’ll cut down my furniture rental costs. 

Saying all of that to ask… should I be putting these people through my regular application process? I know Airbnb does background checks and what not - but do they verify one’s ability to pay beyond entering a 16 digit card number?  This would also be my first time hosting my owned unit and I’m not even really sure how payments work. $15k is a lot to just charge at once to ones CC and I’d like some assurance knowing who they are beyond their relatively slim Airbnb profile. Member since 2013, but only 1 stay in DC last year that yielded a 5* review, and loves to rollerblade. 

Does Airbnb allow you to do that? You can’t even paste a link or phone number in the messaging. 

Thanks in advance!

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Nathan GesnerBusiness Member
Moderator
Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
3y

MTR is not a real thing and only serves to confuse people.

If you are renting for more than 30 days, it is legally considered a long-term rental and you should follow long-term rental practices. They should fill out an application and pass your screening. Collect a deposit. Use a written lease agreement. Treat it like you would a long-term lease because that is exactly what it is. Whether you include utilities and furnishings with the rent does not change anything and it certainly doesn't create a new situation that justifies a new term.

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  • Member since 2019 · 25 posts · 12 votes
    3y

    I do MTRs which are usually 30+ day stays. So most of my bookings are 3 to 4 months long. Nothing strange there. You can ask for a background check if the booking isn't confirmed.

    I have never had someone ask to bring their furniture though. And probably won't allow it just because of possible damages in the move!

    also, for long term stays note that airbnb doesnt charge the full amount all at once. People are charged monthly instead.

  • Luke CarlPro Member
    Rental Property Investor · Tennessee Florida · Member since 2016 · 4k+ posts · 5k+ votes
    3y

    32 days is a tenant and yes I would do a background check and credit check and a lease. I would also use furnish finder because Airbnb is for 3-4 days not 32. 

  • John UnderwoodPro Member
    Investor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
    3y

    Absolutely.

    Anything over 28 days treat them like a long term tenant with background check and a lease.

  • Property Manager · Raleigh, NC · Member since 2022 · 117 posts · 110 votes
    3y

    Legally speaking, in North Carolina, STRs are under thirty days and MTRs are over thirty days. If booked through Airbnb, I do not require applications for STRs (there is an expedited eviction process which I have never had to use, but minimizes risk). However, I do require applications and formal leases for stays of over thirty days. 

    By the way, things might be different in @Luke Carl's market. But in my area, I commonly get Airbnb reservations for several months at a time. Of course, list on Furnished Finder too. But I have found Airbnb to be just as helpful in marketing MTRs.

  • Nathan GesnerBusiness Member
    Moderator
    Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
    3y

    MTR is not a real thing and only serves to confuse people.

    If you are renting for more than 30 days, it is legally considered a long-term rental and you should follow long-term rental practices. They should fill out an application and pass your screening. Collect a deposit. Use a written lease agreement. Treat it like you would a long-term lease because that is exactly what it is. Whether you include utilities and furnishings with the rent does not change anything and it certainly doesn't create a new situation that justifies a new term.

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  • Rental Property Investor · Chicago · Member since 2022 · 20 posts · 7 votes
    3y
    Quote from @Nathan Gesner:

    MTR is not a real thing and only serves to confuse people.

    If you are renting for more than 30 days, it is legally considered a long-term rental and you should follow long-term rental practices. They should fill out an application and pass your screening. Collect a deposit. Use a written lease agreement. Treat it like you would a long-term lease because that is exactly what it is. Whether you include utilities and furnishings with the rent does not change anything and it certainly doesn't create a new situation that justifies a new term.

    BP is the first place I’ve heard MTR used so frequently - though I understand the concept. I list on Airbnb because the City isn’t approving my house share app because I don’t occupy the unit, so this is my alternative route. Stay has to be longer than 32 days to forego the licensing requirements, so those are the requests I’ve been getting. 

    Have you done this before with Airbnb? Do I take the conversation off of their platform and execute a lease separately with a monthly payment? They’ve asked for a stay of 3/19 - 8/31. 
  • Rental Property Investor · Chicago, IL · Member since 2018 · 53 posts · 54 votes
    3y

    @Kayla D. If this is in the city of Chicago and they're staying over 28 days, the city considers you a landlord, them as a tenant and the city is very tenant friendly. So I would definitely recommend you do the same due diligence as you would for a traditional 12-month tenant and have a strong lease agreement.

  • Rental Property Investor · Phoenix, AZ and Rehoboth Beach DE · Member since 2019 · 1k+ posts · 1k+ votes
    3y

    If Airbnb finds out you're taking the payment off platform, they will ban your listing.  Since they contacted you on Airbnb, take at least the first month's payment there, then subsequent months you can go off platform.  Airbnb does not do background checks.  They are only now getting around (this spring) to verifying that the person booking has a valid identity and credit card.  But that isn't a full background check.  As everyone else says, treat this like an LTR with a lease, background check, valid income, security deposit, etc.  

  • Bruce WoodruffPro Member
    Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
    3y

    As others have said, make really sure if you're going to do a long-term lease to fully vet this tenant. Do background checks, credit checks and every other kind of check you can do. And make sure your lease is tight.

  • Real Estate Agent · Austin, TX · Member since 2020 · 1k+ posts · 941 votes
    3y
    Quote from @Kayla D.:
    Quote from @Nathan Gesner:

    MTR is not a real thing and only serves to confuse people.

    If you are renting for more than 30 days, it is legally considered a long-term rental and you should follow long-term rental practices. They should fill out an application and pass your screening. Collect a deposit. Use a written lease agreement. Treat it like you would a long-term lease because that is exactly what it is. Whether you include utilities and furnishings with the rent does not change anything and it certainly doesn't create a new situation that justifies a new term.

    BP is the first place I’ve heard MTR used so frequently - though I understand the concept. I list on Airbnb because the City isn’t approving my house share app because I don’t occupy the unit, so this is my alternative route. Stay has to be longer than 32 days to forego the licensing requirements, so those are the requests I’ve been getting. 

    Have you done this before with Airbnb? Do I take the conversation off of their platform and execute a lease separately with a monthly payment? They’ve asked for a stay of 3/19 - 8/31. 

    I've hosted dozens of MTR stays on Airbnb. Personally, I don't do a lease or a background check, up to you. I've found that the tenants paying $3-5k per month are high quality and you don't have to worry about evictions. If it helps you sleep at night, get a lease. You can ask on platform to get a lease. Also if they booked already you have their phone number to contact them directly.

  • Investor · Member since 2022 · 1k+ posts · 754 votes
    3y

    Yes you want a signed lease and a background check IMO. This is a tenant, not a guest. 

  • Rental Property Investor · Chicago · Member since 2022 · 20 posts · 7 votes
    3y
    Quote from @Lauren Kormylo:

    If Airbnb finds out you're taking the payment off platform, they will ban your listing.  Since they contacted you on Airbnb, take at least the first month's payment there, then subsequent months you can go off platform.  Airbnb does not do background checks.  They are only now getting around (this spring) to verifying that the person booking has a valid identity and credit card.  But that isn't a full background check.  As everyone else says, treat this like an LTR with a lease, background check, valid income, security deposit, etc.  


     That’s my concern. Executing a lease while adhering to Airbnbs booking policy. What can I do with them and without them? My lease and application process for my other unit lives outside of Airbnb and the total stay includes their fees and monthly discount. I’d draft a lease for that total amount Airbnb is showing? What about my terms, renter insurance requirements, etc - does Airbnbs guest policy trump my lease agreement terms? Tricky 

  • Rental Property Investor · Phoenix, AZ and Rehoboth Beach DE · Member since 2019 · 1k+ posts · 1k+ votes
    3y
    Quote from @Kayla D.:
    Quote from @Lauren Kormylo:

    If Airbnb finds out you're taking the payment off platform, they will ban your listing.  Since they contacted you on Airbnb, take at least the first month's payment there, then subsequent months you can go off platform.  Airbnb does not do background checks.  They are only now getting around (this spring) to verifying that the person booking has a valid identity and credit card.  But that isn't a full background check.  As everyone else says, treat this like an LTR with a lease, background check, valid income, security deposit, etc.  


     That’s my concern. Executing a lease while adhering to Airbnbs booking policy. What can I do with them and without them? My lease and application process for my other unit lives outside of Airbnb and the total stay includes their fees and monthly discount. I’d draft a lease for that total amount Airbnb is showing? What about my terms, renter insurance requirements, etc - does Airbnbs guest policy trump my lease agreement terms? Tricky 

    I believe asking them to sign a rental agreement or lease, plus background check etc. is ok with Airbnb as long as you say that in your description before they book. I would just do a lease for a one month stay on Airbnb.  Then use your regular lease from that point forward, so they'd be signing two documents.  I assume this will be month to month, since they don't have a firm ending date for their stay.  The only disadvantage is that you can't accept any other bookings because you don't know when this one will end.  Make sure they have a good source of income, because they are essentially homeless while they look for this new house.
  • Michael BaumPro Member
    Olympia, WA · Member since 2016 · 8k+ posts · 7k+ votes
    3y

    Well @Kayla D., you would be setting yourself up for a big problem. I would expect that that mother/daughter simply wouldn't leave. Why would they? There is no lease stating anything. They could just squat in there for years if they wanted. You would have almost no recourse as you don't have a signed agreement.

    Don't do it. I am dead serious about this. I know from your other posts that you have been having problems getting the city to allow your STR, but trying to do a short stay long term rental without a proper lease in place is a huge mistake.

    The simple fact that they would be willing to pay full nightly rate for that time is a huge red flag. Anyone who has contacted me about a 3 months stay over the winter wants to pay market rental rate for a long term rental, not my nightly STR rate.

  • Nathan GesnerBusiness Member
    Moderator
    Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
    3y
    Quote from @Conner Olsen:

    Operating a long-term rental without a written lease is playing with fire. You may save yourself some time and trouble in the beginning, but it will come back to bite you one of these days. Taking shortcuts is not a wise investment strategy.

    Tenant drives Lamborghini but refuses to pay $5,000 rent: https://www.blogto.com/real-es...

    Watch "Pacific Heights" with Michael Keaton. It only takes one bad tenant to ruin your life.
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  • Real Estate Agent · Austin, TX · Member since 2020 · 1k+ posts · 941 votes
    3y
    Quote from @Nathan Gesner:
    Quote from @Conner Olsen:

    Operating a long-term rental without a written lease is playing with fire. You may save yourself some time and trouble in the beginning, but it will come back to bite you one of these days. Taking shortcuts is not a wise investment strategy.

    Tenant drives Lamborghini but refuses to pay $5,000 rent: https://www.blogto.com/real-es...

    Watch "Pacific Heights" with Michael Keaton. It only takes one bad tenant to ruin your life.

    Great point!

  • Attorney · New Orleans, LA · Member since 2017 · 38 posts · 19 votes
    3y

    AirBnb requires that guests are made aware of any lease / contract requirement before they book.  I would check out this article and consider what updates you may want to make to your listing: https://www.airbnb.com/help/ar...

  • Rental Property Investor · Chicago · Member since 2022 · 20 posts · 7 votes
    3y
    Quote from @Michael Baum:

    Well @Kayla D., you would be setting yourself up for a big problem. I would expect that that mother/daughter simply wouldn't leave. Why would they? There is no lease stating anything. They could just squat in there for years if they wanted. You would have almost no recourse as you don't have a signed agreement.

    Don't do it. I am dead serious about this. I know from your other posts that you have been having problems getting the city to allow your STR, but trying to do a short stay long term rental without a proper lease in place is a huge mistake.

    The simple fact that they would be willing to pay full nightly rate for that time is a huge red flag. Anyone who has contacted me about a 3 months stay over the winter wants to pay market rental rate for a long term rental, not my nightly STR rate.

    Yes! I don’t disagree and based on the feedback from you and others I have no intentions on proceeding without a lease. I’m just not sure what, if any, implications are with taking the arrangement outside of Airbnb. 
  • Michael BaumPro Member
    Olympia, WA · Member since 2016 · 8k+ posts · 7k+ votes
    3y
    Quote from @Kayla D.:
    Quote from @Michael Baum:

    Well @Kayla D., you would be setting yourself up for a big problem. I would expect that that mother/daughter simply wouldn't leave. Why would they? There is no lease stating anything. They could just squat in there for years if they wanted. You would have almost no recourse as you don't have a signed agreement.

    Don't do it. I am dead serious about this. I know from your other posts that you have been having problems getting the city to allow your STR, but trying to do a short stay long term rental without a proper lease in place is a huge mistake.

    The simple fact that they would be willing to pay full nightly rate for that time is a huge red flag. Anyone who has contacted me about a 3 months stay over the winter wants to pay market rental rate for a long term rental, not my nightly STR rate.

    Yes! I don’t disagree and based on the feedback from you and others I have no intentions on proceeding without a lease. I’m just not sure what, if any, implications are with taking the arrangement outside of Airbnb. 
    Well, one main issue is that you don't have AirBNB as the "big brother" watching over the transaction. You could ask for help from AirBNB if there is a problem and that won't be available. Frankly, that isn't that big of a deal. They are rarely helpful to me when there is an issue.

    Also, if the booking came in via AirBNB, it would be a violation of the terms of service to take it off the platform to book. They lose out on the revenue. That could get you booted off the platform and you wouldn't be able to get back on.

    I don't think there is a problem requiring a signed lease while using AirBNB as the booker. Give them a call and tell them your concerns.
  • Jonathan KlemmBusiness Member
    Moderator
    Contractor · Chicago, IL · Member since 2016 · 4k+ posts · 2k+ votes
    3y

    Hey @Kayla D. - I am also a Chicago mid-term rental landlord.  Firstly, I suggest you check out using www.furnishedfinder.com - you'll find better quality guests.  

    I highly suggest you go through the normal application process as a tenant like this WILL follow the Chicago Landlord Tenant Ordinance which is quite important to know.  

    You can use creative ways to share phone numbers like writing the numbers out fyi.

  • Bruce WoodruffPro Member
    Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
    3y
    Quote from @Jonathan Klemm:

     Firstly, I suggest you check out using www.furnishedfinder.com - you'll find better quality guests.  

    But far less traffic from that site...

  • Jonathan KlemmBusiness Member
    Moderator
    Contractor · Chicago, IL · Member since 2016 · 4k+ posts · 2k+ votes
    3y

    Totally agree with you @Bruce Woodruff!  For our unit here in Chicago we just found that quality guests over quantity have been the best fit for our business model.

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