Should I accept this tenant?

Question

A prospective tenant showed up today and their  monthly household income is 1.9x rent and have additional incomes social security, job disability income etc ,income with this additionals comes close to 3x (little less may be 2.9) they have excellent credit score and no records of eviction was found but my initial impression was to turn down but they vouched that they never missed their rent payments and assured the same with me,and i ended up agreeing but did not yet draft lease. Should I go ahead and accept them?

Steven Foster Wilson · Answer

This is a great idea, and if income is the issue requirement, seeing if he can provide additional security deposit is a good tell of his money saving situation.

Joe Splitrock · Answer

Here are my thoughts:

- You would include disability and social security as income since they are regular payments, so I would include that.

- Most people consider 2.5 to 3X rent as minimum requirement for income, so the 2.9 is within a reasonable range.

- It is important to be consistent so if your standard is 3X income for rent, then stick to that. If it is 2.9X, then stick to that. You shouldn't change qualification standards to meet the applicant.

- It sounds like you already verbally accepted the applicant. If that is true, I would not go back on my verbal commitment.

- You should be able to verify if the current landlord is selling.

Matt Bishop · Answer

@Peter Morgan,  yes. Accept them.

Gregory Schwartz · Answer

@Peter Morgan if an applicant is just short on one of our requirements we ask the tenant if they'd be willing to pay an additional $100-300 in security deposits. Most are willing to pay this and it helps with the increased risk associated with a tenant who is just shy of a requirement be it credit, income, or rental history. Food for thought.

Joe Splitrock · Answer

If you are selling with a year lease in place, the lease travels with the property so the tenant will be allowed to stay with the new owner. That could limit you ability to sell the property, so it is better if you lease to someone willing to go on a month to month lease. I would be transparent with a tenant that you may sell, especially if you think the tenant may need to move.

Peter Morgan · Answer

@Joe Splitrock

Thanks Joe and everyone  who shared your wonderful insights. The tenant is moving out from his current  place because his landlord is selling the property as well as he is on a month to month tenancy.

I am afraid few months from now I may sell my property but I ended up  agreeing when they indicated they are in a tight spot.

I don't know for sure when I will sell it , I will very likely  sell, it could be two months from now or six months from now, I am feeling extremely  confused if I should upfront tell them that I will most likely sell my home,appreciate if you can share me your insights

Michael Robbins · Answer

@Peter Morgan I would stick with your minimum rental qualifications.  If the applicant does not meet the 3x the rent then double check the income.  If income is still not met then I would follow the qualifications.

Steven Foster Wilson · Answer

With all their income they meet the conservative rule of 3x income. They have good credit....Sounds like a good fit and I would move forward. I have found people who have $120k in income but bad credit, they found a way not to afford rent. But people with good credit, IMO have found ways to get that rent paid.

Peter Morgan · Answer

Okay, they indicated their current landlord is selling property and are in a tough spot so looking for something to move immediately. Is it safe to go ahead with them?

Bill B. · Answer

Most places require you to count all income, the rest are probably moving that way. I wouldn’t turn someone down because they are getting guaranteed money from the government, but I also wouldn’t bend my qualifications. If 3.0 is your MINIMUM that’s your minimum. What if you accept this tenant but not the next 2.9x income applicant? Can they claim racism or some factor is the reason?

If des moines is anything like vegas we have an abundance or very well qualified applicants beating down the doors. Has the place been vacant more than a week? If so ask a PM what they would charge in rent snd how fast they think they would get a qualified applicant.

Should I accept this tenant?

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