All Forum Posts by: Anna Sagatelova

 Portland is a dream. Loved my time there and would definitely live there again.

@Robert Palladino when you set a score cutoff, you set yourself up for these situations. This is why we state our criteria to depend on credit history (which of course includes score) rather than strictly score. If you are advertising a certain set of criteria, and approving this candidate would be contrary to that criteria, you should not approve. If you are in the position of being able to change your criteria (specifics were not advertised AND you have not already assessed other candidates on the old criteria), I think you can move to a more general "credit history" and then consider the low score together with recent history - is he paying his current car loan on time? How long ago was the non-payment?

The whole "it was my daughter" line really doesn't make a difference to me. It sounds like he was a co-signer/guarantor on her loan. Guess what that means? If she doesn't pay, he agreed to be liable and make that payment in full and on time. He should have honored his agreement to remit payment to the creditor and then settled the matter with his daughter as they saw fit.

If you haven't already, I would definitely include past landlord references as part of your rental screening criteria. Create a set standard like a minimum number of consecutive years or landlords, and stick to it.

@Michael Marchman ADA has nothing to do with residential rentals, this is a very common misconception. Fair Housing is the relevant law.

@jocelyn canfield They live there and if they need assistance they are entitled to it per Fair Housing. You don't live there, so there is no Fair Housing rule to apply to you at that property.

We have credit history criteria, rather than one specific cutoff score. Your idea is an interesting one! When you retain the fee based on credit score, are you providing any sort of eviction guarantee to your clients?

 Thank you, Patrick!

Have you considered asking for a 2 year lease, since that's the minimum you really want? It can be risky - they may not be so perfect after all, and you'll only find out after they move in - but you can at least have the conversation saying you are really looking for someone longer term.

If not, there is absolutely no guarantee that any other tenant will stay more than your lease term states, anyway. If you have a 12 month lease, that's all you can expect at the time.

Lots of "spicy opinions" on this all over the forums, especially lately, but I think the "why" boils down to who the owner is and their reasons for getting into rentals in the first place. 

Some see this as simply a passive income opportunity and truly don't want to think too much about all the details. They educate themselves on the financial side just enough to manage the manager (many don't even get that far). Many of our OOS investors here in Cleveland do fall into this camp.

Others want to maximize every aspect of this opportunity, and what does it mean to maximize? Well it's different for every person, because you can only grow within your means. Are you a high net worth individual? Most people are not, and so for many in this camp, "maximizing" means staying as hands-on as possible to cut costs. Others (with the means to do so) will argue that to truly maximize, you have to grow outside your market, and diversify your portfolio as much as possible. When that happens, unless you plan on starting your own de facto management company (even if you don't call it that), you need professional management in place.

Finally, some people are passionate about one side or the other because they've been burned. There are people who started out self-managing and it was a disaster. They now swear up and down about the necessity of hiring a third party PM. Unfortunately, not all PMs are created equal (as with literally any business/industry), and some people have had an unfortunately terrible experience, or two, or even three, and now preach against PMs based on that. It's worth noting that some people's "terrible experiences" are due to unrealistic expectations and severe control issues, but I think that is still the minority compared to people who truly experienced poor service in some shape or form.

Now, that's the "people" side of things. But then there are those people who have a PM for some properties and not for others. These are the folks who have really done their homework, had the means to invest in diverse properties/markets, and understand that it's not a one-size-fits-all approach. @Anish Tolia said it best in the related forum thread.

This is an interesting approach. Does your PM firm retain any part of that fee, or does it all pass on to the owner? What do your clients think of it? 

Bankruptcy is a difficult one to tackle, but as usual @Patricia Steiner is right. Your screening criteria should be as unambiguous as possible and not leave room for you to have to put on the Personal Investigator hat to suss out the truth of the sad story, if one is presented. Then, you need to be disciplined about sticking to that criteria.

This is why we don't set a credit score cutoff, credit history is a more inclusive term that doesn't bind us to act a particular way in this type of situation. Credit score can also be easy to mess up and hard to bring back up, especially with things like medical debt that could be years old.

Take the approach of who is really responsible for paying the rent... technically, they all are jointly and severally liable, but you know it's not the adult kid paying rent for the parents...