What standards should I set for my tenant applications?

Question

I have a new (first)  investment property and I am screening potential tenants through Zillow. I have read that I should have a pre set level for standards that must be met to be considered. How / where do I set those requirements? Is there a certain credit rating I should stay above? Automatically exclude anyone with an eviction?  I’m getting applications that provide information to me but I’m not quite sure how to evaluate that information.

Taylor L. · Answer

Depends on your area, some states and cities have laws preventing you from counting evictions and such against potential tenants. Common standards are gross income = 3x monthly rent, no evictions, decent credit (you can pick your number).

You should 110% take a crash course on fair housing law as well. There are a lot of landmines you need to avoid which most investors don't know about.

Jim K. · Answer

My number one indication of a bad tenant has been the same for many years now: penmanship is king. Really, you simply can't trust the ability of a person to follow any system of rules over the long haul if they can't manage to write out an application to rent a home for a year legibly. You just can't.

Mary M. · Answer

I dont take apps before showing.  Also, i dont “do” applications fees.  I beleive they are cost of being a landlord. I do have the applicant pay for their credit reports.

John Thedford · Answer

No. I let them look and then take an app if they want the unit. I get $75 app fee. That is higher than what others charge but shows me they are serious.

Tom Coakley · Answer

@John Thedford

Great stuff! Thank you. Do you require potential tenants to fill out applications BEFORE seeing the property?

John Thedford · Answer

Here are some of my standards:

Monthly income 3x the rent

No smokers

600 minimum credit score

1 year on present job

No eviction in last 10 years

Criminal records scrutinized. If they murdered their last landlord that is an automatic FAIL

Print out your requirements and pass them out at showings. Don't do 10 different showings. Schedule a 1-2 hour wimdow for all to come look.

Tom Coakley · Answer

@Taylor L.

Thanks!

What standards should I set for my tenant applications?

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