Should it Be Legal for Landlords to “Use Their Gut” When Screening Tenants?

by | BiggerPockets.com

There has been a bit of a fuss lately in Seattle regarding an ordinance the city passed back in 2016. The City believed that landlords were not being fair to all prospective applicants. They worried that a potential applicant who met all of the landlord’s qualifications to rent a property was still be denied in favor of someone who was, I guess you could say, even more qualified. The City therefore ordained that landlords must accept the first applicant who meets a landlord’s rental qualification guidelines. Landlords can no longer discriminate amongst qualified applicants. Some landlords, especially smaller ones, recently cried foul, stating that “they have to use their gut feeling” somewhat when qualifying tenants. Being a smaller landlord, I have to say that I use my gut all the time in screening tenants—but perhaps not in the way that you might think.

Download Your FREE copy of ‘How to Rent Your House!

Renting your house is a great way to enter the world of real estate investing, but most first-timers (understandably) have a lot of questions. Fortunately, the experts at BiggerPockets have put together a complimentary guide on ‘How to Rent Your House’. All the skills, tools, and confidence you need to successfully rent your house are just a mouse-click away.

Click Here For Your Free Guide to Renting Your House

Must Landlords Select Based on “First Come, First Serve”?

I suspect some of this fuss stems from the fact that Seattle is a hot real estate market. According to Trulia.com, rents in the area have increased significantly, up about $300 over the past year or so. These numbers lead me to believe that the demand for housing is very strong, and I would bet that most landlords are in the enviable position of having numerous qualified applicants.

Related: 10 Not-So-Obvious Ways to Thoroughly Screen Potential Tenants

So, how then should landlords choose the best applicant in Seattle—or anywhere else for that matter? Should landlords be forced to select tenants on a “first come, first serve” basis, or should they be able to “use their gut” and pick from a pool of qualified applicants? Can the rental application and qualification process be distilled down to checking “yes” or “no” boxes on a form? Should landlords have to take the first qualified tenant? I’m not completely sure, and there are many property and association rights issues there, but I do think that the tenant application and qualification process can be tailored so that the items used to qualify applicants have a direct bearing on whether or not the applicant will be a suitable tenant even when using your gut feelings.

Here is what I mean.

tenant-funnel

A List of Specific Criteria

All landlords, no matter how small an operation they are, should have a written list of criteria they use to qualify and disqualify potential tenants. This list should have a direct bearing on the individual’s ability pay rent and in general be a good tenant.

This may include items such as:

  • Verifiable sources of income
  • An acceptable rent-to-income ratio
  • A lack of evictions or bankruptcy filings
  • A lack of a major or recent criminal record
  • Evidence suggesting a courteous person who does not use intimidating or foul language
  • A generally clean and well kept appearance
  • Truthfulness on and during the application process

Many other items could be included on this qualification list as long as they do not break the law and as long as you are consistent in their application. You could, for example, not rent to folks who own motorcycles or who smoke or who are full-time students if you wanted to, as none are generally a protected class.

What should not be on your list are criteria that have absolutely no bearing on an individual’s ability to pay rent or otherwise be a good tenant. Many of these are protected classes, and you could get into a lot of legal trouble if you deny an applicant based upon any of the following:

  • A person’s race, color, or national origin
  • A person’s religion, creed, or personal politics
  • Familial status or number of children (subject to some overcrowding guidelines)
  • A person’s age, sex, or sexual orientation
  • A disability that can be reasonably accommodated
  • Their current or former military status

Discriminating against these folks seems stupid to me. Why would you want to shrink the pool of folks willing to give you their money? It just seems like a poor business decision.

Once you have such a list, should you be able to use your “gut feeling” during the application process? Yes, I think so. In fact, I think landlords have to, and I do not know how they could not. As an experienced landlord, my gut tells me when something is wrong, when two plus two is not adding up to four.

Where the “Gut Feeling” Comes in

If you get a bad feeling in your gut, what it is trying to tell you is that the applicant is trying to cover something up. And just like a detective, you have to investigate. You have to dig a little to find out what is not adding up. I’ve had prospective tenants, for example, submit fake check stubs and provide phone numbers that went to friends as a means to verify income and employment. I discovered these attempts at deception because something did not sound or look right. My gut told me something was wrong. Can that be difficult or uncomfortable? Yes, but experience will teach you. Will you catch everyone? No. But every experience will help you revise your qualification criteria periodically to cover those who slip by. This in my view is the proper way landlords should use their gut.

tenant-screening-tips

Related: 12 Tips I’ve Learned From Screening Close to 500 Prospective Tenants

Should you take the first qualified applicant? Sure. I would. To me, a qualified tenant is as good as a bird in the hand, and if you’ve set up your criteria properly in the first place, you are not going to find someone better anyway. Plus, it seems like kind of a jerk move to qualify and accept someone, only to reject them later.

The bottom line to me is this: I don’t care if you are gay. I don’t care if you are a middle-aged woman from Nigeria with three kids. I’m not interested in having a religious or political discussion with you. I am interested in having a respectful landlord/tenant relationship with you, where I provide decent housing and rent is paid with minimum hassle. That is what I think my rental qualification process achieves, and yours should as well. Does that take using my “gut feeling” sometimes? Yes. Can you legislate that away? I don’t think so. But when jurisdictions try to do so, perhaps some landlords were not quite objecting to the right part.

For the record, I am not a landlord in nor do I own property in the city of Seattle. But as a landlord, I do like to keep up with such trends because what one city does often trickles down to others.

Landlords in the Pacific Northwest and elsewhere, please chime in and share your experiences.

Let me know your thoughts in the comments.

About Author

Kevin Perk

Kevin Perk is co-founder of Kevron Properties, LLC with his wife Terron and has been involved in real estate investing for 10 years. Kevin invests in and manages rental properties in Memphis, TN and is a past president and vice-president of the local REIA group, the Memphis Investors Group.

56 Comments

  1. Ali Hashemi

    I would argue that ‘intent’ plays a large factor. I would rather rent to someone who plans on staying a long time than someone who is simply transitioning living arrangements. Both candidates may qualify however I prefer one over the other due to their longevity.

    The comparison can be made to hiring employees. Both candidates may be qualified however one has an interest in becoming CEO the other is perfectly happy working this job the rest of their life. Depending on what I’m looking for in a candidate the intent matters.

    Intent can’t be reduced to a check box on an application

    • Adam Britt

      I’m saying this as an individual with absolutely no background experience, but to your last point … Why not?

      Off the top of my head, I can’t see why you shouldn’t have a little question at the end that says something like, “How long do you anticipate living in the area?” or something to that effect. Then have a multiple choice option.

      Then, if you do get sued and this new law is cited, at least you can point to a qualification you listed and you have logical, business related answers to the question!

      • Darin Anderson

        I have had multiple qualified applicants applying at the same time. They always ask me how are you going to decide. I make it real simple. I tell them who ever qualifies and signs the longest lease wins.

        The ones who want to stay a while immediately start talking two and three year leases, which is exactly what I want to hear. The ones who are just passing through don’t say much at that point. They already know they lost.

        An no I am not afraid to sign a 3 year lease to a new tenant. If they violate the lease in any way I can remove them. If they don’t, why would I want to.

        • I can’t say I agree with your view towards long leases. One year max and no automatic renewal or month to month at lease end. 60 day prior notice to intent is necessary from both parties to the lease. This can make ‘eviction’ for a non monetary breach a relatively painless and far less costly issue. Eviction can take three or four months and $3-$4k. A long term lease means that you can’t easily raise the rent and in my experience….waiting 3 or more years to raise the rent becomes a difficult sell when the market is inflating. People aren’t any more clairvoyant as to their future than you are….stuff happens….and in my many years doing this, people find a way to leave, and with you holding the bag……every time.

          But hey, good luck with your plan.

        • Darin Anderson

          BTW if people want to leave early my lease has an early termination clause. it will cost you 2 months extra rent to terminate early. If they don’t want a judgement on their credit they pay it. Yes I have had people leave early. Yes they paid it. Again, might come down to the types of tenants one’s properties attract.

          I am only doing this on people who already pass all my criteria. Length of stay is the tie breaker, not the key determinant. I am also not trying to force someone to stay who doesn’t want to. I am trying to eliminate the person who is just on a 1 year pass through plan as they move to a different area or buy a house or whatever. That tenant is costly. Very costly. More costly than an occasional eviction (which I have never in 10 years had to do by the way). I don’t know what state you live in but in MN eviction takes 3 weeks and costs a few hundred dollars.

          This policy is extremely effective at finding long term renters. Saves me time. Saves me hassle. Saves me money.

        • Katie Rogers

          The policy is treating my tenants according to the Golden Rule. This policy is extremely effective at finding long term renters. Saves me time. Saves me hassle. Saves me money. A good landlord has no trouble keeping long-term tenants even if the lease is a month-to-month. This kind of good landlord doesn’t have expensive vacancies because their departing good tenant will recommend your place to one of their friends, also likely to be a good tenant (birds of a feather and all that). Your place will not even go on the market before it is re-rented.

        • Kevin Perk

          Darin,

          I think I am more inclined to agree with Daryl below, but every market is different and there are a million ways to do this business. If what you are doing is working for you than more power to you.

          Thanks for reading and sharing,

          Kevin

    • Kevin Perk

      Ali Hashemi,

      I agree with you about long term tenants as tenant turnover is one of the costliest things about this business. We do look at how often a tenant moves and I know landlords who will disqualify applicants if their application shows they move year to year.

      But, your market may also dictate tenant movement. I am in a market that serves folks who are just getting out of school, changing jobs, getting married, having kids, etc. These factors lead to some tenant instability. On the other hand, they are often very good tenants who leave my properties in excellent condition. Other landlords in different parts of Memphis just don’t have that. But they do have tenants who are looking to get their kids in a particular school and stay for the duration of school age years. It can be quite different from place to place even in the same city.

      Plus, as others have mentioned below, I’m not sure I want to be tied to a tenant for a long term. We do a year lease with automatic yearly renewal if both parties agree. And while I like long terms tenants, sometimes it is best for everyone to part ways.

      Thanks for reading and commenting, I do appreciate it,

      Kevin

  2. Cindy Larsen

    Kevin,
    i agree with everything you have said: as landlords we have to be fair and non-discriminatory. However, as business people, we have a right to choose who we are willing to do business with. If I have a pool of applicants who have all passed my selection criteria, then I must choose somehow.

    It unlikely to find two applicants who have excatly matching credit backgrounds, criminal backgrounds, etc. Whatever your objective criteria, once those are met, you enter the realm of the subjective. This is no different from any other business. A businees may choose not to use a particular supplier because they do not like doing business with them, or may choose not to serve a rude customer.

    In general, I will chose the most qualified applicant, based on which qualifications are more important to me. This may be, for example, a higher credit score. But given two qualified applicants, I may NOT choose the one with the higher credit score. My selection criteria simply specifies a minimum credit score. Once that score is achieved, there is room for judging which tenant I would rather do business with. I genuinely do not care about race, religion, sexual preference, political affiliation, etc.

    However, I self manage my properties, and not spending time dealing with difficult people is important to me. A tenant who approaches each interaction in a hostile or agressive manner is not one I would chose, for example. Imagine having to evict such a person. I would not choose a person whom I have observed to not treat others with respect. And there is nothing wrong with not choosing someone my instincts tell me not to trust. There is also nothing wrong with choosing someone who meets my criteria, but is slightly less qualified, and who I can help by choosing them.

    I support the laws that stop landlords from being unfair. But I do not support the government telling me how to make my business decisions once I have ensured that I am not being unfair.

    • Erik Whiting

      There is a simple soltuion to at least one of the objections raised here, one that I use.

      “A businees may choose not to use a particular supplier because they do not like doing business with them, or may choose not to serve a rude customer.”

      1) Why don’t you like them? You need to state that, clearly. “Doesn’t pay bill on time….shows up late to meetings….picks their nose during the tour of the house.” All defined criteria. “I don’t like them” is a LAZY man’s description of a real-world problem. Get specific and you can still deny legitimately.

      2) Rude applicants. Easy cheesy. One of my written criteria is “applicant is cooperative and polite to land lord, employees, and contractors.” Again, this is an easy legitimate criteria, as long as you are consistent.

      I have DQ’d people on the spot for showing up 20 minutes late to lease signing when they failed to call, text, or somehow communicate they were running late. Yeah…. I did that. Disrespectful of my time; I figure they won’t be timely rent payers either.

    • Kevin Perk

      Cindy,

      All very good points.

      Government’s however keep trying to legislate what is “fair” and thus keep restricting the choice of who you can do business with. I fear that as landlords adjust to Seattle’s new legislation, it will foster more legislation to counter those adjustments. Time will tell.

      Thanks for reading and commenting,

      Kevin

  3. Intent??? A tenant, no more than a job candidate can predict the future. They may want to stay for several years, but things happen. House is drafty, you’re not the landlord you think you are, the neighbors don’t get along and scream at each other, too many kids walking on the grass, bias exists in everyone to a degree. The only best practice that I can see keeping you out of trouble is to lay out specific benchmarks, in writing, for applicants to meet or exceed. That way ‘best’ becomes a game of whack a mole that you, the landlord control. Unless the law passed by the council has outlined specifics as to what a qualified tenant is, it’s mostly bark without bite. They can only restate what the protected classes are, they can’t project what the ‘correct’ credit score is to be, any more than they can set rent by dollars per square foot.

    Hope for the best, plan for the worst.

    • Kevin Perk

      Daryl,

      “Unless the law passed by the council has outlined specifics as to what a qualified tenant is, it’s mostly bark without bite”

      I’m concerned that this is often where these types of things lead.

      “They can only restate what the protected classes are, they can’t project what the ‘correct’ credit score is to be, any more than they can set rent by dollars per square foot.”

      I there there are plenty of folks who think they can and will lobby to try.

      Thanks for commenting,

      Kevin

  4. Dennis Patterson on

    The day I cannot use my experience and common sense in selecting a tenant- is the day I will sell my rentals and invest elsewhere. Just because someone might fill all the blanks out right does not mean they will be clean and respectful of others around them- theres more to being a good tenant than just paying the rent. A property provider thats been in the game a while knows in a few minutes in a interview what he or she is looking for in a tenant- If they don’t see what they are looking for they will keep looking- I don’t care what this kid thinks- its just his opinion- When you move a tenant in- at that moment- its either your dream come true or your worse nightmare. That thing called a gut- is there for a reason.

    • Kevin Perk

      Dennis,

      That day may very well come as these things tend to build and compound. But I generally agree with you about what experience teaches. As a sort of realist though and understanding the society that we work in the more specific I can be about my reasons for disqualification the better I feel.

      BTW, thanks for calling a guy born in the later 60’s a kid. 🙂 I appreciate that, your comment and you taking the time to read my post,

      Kevin

  5. gayle quinlan

    Thats crazy..Its my place, I own it and Ill go with my gut..because its usually correct !!! Enough with the politically correct BS..spare me..If I check everything out and they ‘seem ” ok, but something doesnt seem right..I have the choice to move on

  6. Erik Whiting

    Very well written piece, thank you for addressing it.

    What I have learned over 13 years in the game is my “gut” is picking up on a legitimate concern, one that is absolutely legal to deny someone based on. I just have to get better at “listening.” Tenant screening takes practice, and there are few folks who tell you what to do.

    One trick I started a few years ago was checking on Social Media. I get them to “like” my company facebook page in exchange for a discount of $5 off our normal application rate. That way I get to the person quickly without having to try to find the John Smith applicant among 100,000 other John Smiths. I have found all sorts of valid reasons to deny people on social media. Pictures of pets (that they said they didn’t have), keg parties, white supremacists who actively advocate violence (hey, I’m all for the 1st Amendment, but when you say, “I want to kill all the #@$#”….that’s a no-no! Plus, I’m not the Govt….I can discriminate against free speech if I find it personally distasteful…only the Govt is not allowed to do that.)

    Another trick is the 2-minute in home inspection. Once an application is “qualified”, we schedule a time for me to go visit where they live today. Yes, this is a must-do for any serious land lord. You will see, hear, and smell exactly what your unit will look, sound, and smell like in 1-2 months. You will also find out if they are slobs and have roaches. You will also meet their 5 pets (they claimed to have only 1). What about out-of-towners? Call a local real estate agent I whatever town they live. Offer $50 for them to drop by the applicant’s house and have the applicants sign a form. They’ll fill out a simple checklist to mail back to you. Tell me know many starving agents are in the average real estate office, and someone will “bite” on this opportunity.

    You may think this costs too much, but if you’ve ever evicted a hoarder before, it’s $50 well-spent. Remember, you only do this once every other piece of the application is completed and they’re a “Good to Go!” resident otherwise. It shouldn’t be an issue most times and you’ll only spend 1 agent fee to get incredible peace of mind.

    If they refuse to let you/the agent come over….WARNING! WARNING! WARNING! There’s your sign! Deny based on lack of cooperation with the screening event. Remember, the bottom of your application (if you wrote it right) authorizes you to verify EVERY REFERENCE (including their address) using whatever reasonable means necessary. A 2-minute visit is very reasonable. And VERY effective.

    Soooooo many legal reasons/methods to deny those who make our guts “tingle.” We cannot be lazy any more. We must be creative and protect our investments.

    • Kevin Perk

      Katie,

      You know I struggled a bit with hat sentence as I was writing this post. I was trying to think of a word that properly captured all of the various types of properties landlords provide, from luxury homes to student housing and weekly rentals. So I agree in principle to what you are saying and perhaps could have found a better adjective.

      Thanks for reading and commenting,

      Kevin

  7. Andrew Syrios

    This sounds like a lot of regulations; good intentions, but it will end up with bad results. Good landlords, probably ma and pa types who don’t know the law very well will get in trouble on dubious grounds or it will become a bureaucratic mess, or it just won’t be enforced.

  8. William Shadbolt

    Couple of points:

    1. The ordinance requires every rental criteria to have a minimum threshold to pass. For example, the attorney for the City argued that landlords could require an interview but that fails to take into consideration the minimum threshold to ‘pass’ that requirement. Would it be showing up? Then it’s pretty useless to the landlord. Anything useful would be hard to create a ‘minimum threshold’.

    2. The ordinance has been challenged in court. Oral argument happened a few weeks ago and I was in court to hear it. Here’s my article on it: https://www.rhawa.org/blog/first-in-time-lawsuit-filed-by-landlords-receives-its-day-in-court-summary-judgment-hearing

    • Per your article, it seems the city attorney doesn’t have a clue as to what problem the law supposedly solves.
      How did this law get proposed…a tenant group, or a bored councilman coming up for re-election or??

      • Kevin Perk

        Daryl,

        If you read the “Whereas” clauses at the beginning of the ordinance you will see that there were studies and committees that preceded this ordinance. This if often the case with these types of things. Very seldom do they come from out of nowhere.

        Often times as well these things are the result of very innocuous sounding committees or studies. How, for example, could anyone be against a committee to increase the quality of housing? Well, when I hear of such committees my gut tells me to keep an eye on them. As I stated above, some very misguided policies are the result of some very good intentions.

        Kevin

  9. Christopher Winkler

    You can’t, don’t even try; with the fair housing laws, you will regret it. The only thing you can “discriminate” on is finances, or lack of. You can set high credit score minimum, we have seen some landlords not even bother with anyone under 650, or even 700 FICO.

  10. Max Householder

    This law is utter nonsense. It’s the landlord’s property, they and they alone should choose who they do business with, not some local bureaucrat. IMO even anti-discrimination laws are unnecessary and should be repealed, so there’s no way I can get on board with saying to a landlord hey, even though you already jumped through all these ridiculous hoops and now have two or more qualified tenants to choose from, you’re still not allowed to use your judgement, you need to follow yet another completely arbitrary guideline and rent your property on a first-come, first-serve basis. Whose property is it after all, the landlords or the city of Seattle’s? Frankly, I don’t know how anyone can justify owning property in a market that treats property owners like this.

        • Jesse Anderson

          Katie,

          Please show me in the Constitution where somebody doesn’t have a right to refuse to associate with any person/company/affiliation for any reason they deem necessary.

          The Civil Rights Acts are UnConstitutional. As it forces one to associate with another.

          Is discrimination based on the least valuable attributes a person has?

          Absolutely

          Do I agree that a person has a right to discriminate based on those principles?
          Absolutely, that’s freedom.

          If someone wants to be a POS and discriminate on those things, let them. It is in everyone’s best interest to know who those people are so we can financially destroy them by voting with our dollars.

        • Katie Rogers

          For some reason our exchange did not post, so I will copy it here
          I answered that civil rights also in the constitution and suggested you study up on the right of association.

          You responded “Katie, Please show me in the Constitution where somebody doesn’t have a right to refuse to associate with any person/company/affiliation for any reason they deem necessary.

          The Civil Rights Acts are UnConstitutional. As it forces one to associate with another.

          Is discrimination based on the least valuable attributes a person has?

          Absolutely

          Do I agree that a person has a right to discriminate based on those principles?
          Absolutely, that’s freedom.

          If someone wants to be a POS and discriminate on those things, let them. It is in everyone’s best interest to know who those people are so we can financially destroy them by voting with our dollars.”

          Here is my reply:

          My entire question is about the conflict between constitutional rights. You cannot resolve it by picking and choosing which constitutional rights you accept and which you reject. I am not even talking about the Civil Rights Act at all. Civil rights is the first article of the 15th amendment. The Civil Rights Act enumerated those civil rights, but it should not have been necessary to do so. Of course every citizen has the same civil rights regardless of circumstances of birth or other characteristics. It is an American shame that civil rights had to be so enumerated and explicitly conferred upon all citizens. Supposedly the 14 Amendment had already accomplished that purpose.

          There is no such explicit thing in the Constitution about “right of association.” Right of association as a concept was derived from the First Amendment’s right of assembly, and emerged when the courts evaluated attempts to block the NAACP’s efforts to help its members seek redress for violations of Article 14. http://constitution.findlaw.com/amendment1/annotation12.html and https://scholarship.law.nd.edu/cgi/viewcontent.cgi?referer=&httpsredir=1&article=1806&context=law_faculty_scholarshipThe doctrine of right of association pertains to groups, particularly political groups and their members. ”There can no longer be any doubt that freedom to associate with others for the common advancement of political beliefs and ideas is a form of ‘orderly group activity’ protected by the First and Fourteenth Amendments.” (Kusper v. Pontikes, 414 U.S. 51, 56 -57 (1973). )

          So my original question still stands.

        • Jesse Anderson

          13th amendment was between the state and individuals. Had nothing to do with interactions between private citizens due to the fact that it would infringe on the 1st amendment.
          15th was between the state and individuals on voting rights. Not on inn interactions between private citizens.

          Whereas 1A states the right to assembly… Which in today’s vocabulary would equate to association.

          A lot of words used in the constitution changed meanings, almost as if it were orchestrated. Example: welfare – it’s definition changed to what we know today as a synonym for social subsidies; when it was written it didn’t mean that at all, it meant to fare well, prosper. If the founders wanted welfare to mean what FDR assisted changing it to they would have written “poor relief”

        • Katie Rogers

          Why are you talking about the 13th and 15th amendments. I am talking about the 14th amendment. Welfare in the Constitution still means still means fare well and prosper. It implies that the government will not throw up obstacles to a whole group of people achieving prosperity. FDR did not change the meaning of the words in the Constitution. You are still left with the question I posed unresolved.

          “almost as if it were orchestrated. ” Sounds like you have been relying on dubious sources for your information about the Constitution and should probably seek out credible sources.

  11. You may all be good people but the law is to eliminate discrimination and refusal based on race and other factors landlords deny people housing. Racism exists so laws are needed to punish those livinging in the past. Here is an old article but the data is significant. Do background checks and due diligence then make that money. I only see green. https://mobile.nytimes.com/2013/06/12/business/economy/discrimination-in-housing-against-nonwhites-persists-quietly-us-study-finds.html?referer=http://www.google.com/

  12. Tim Swierczek

    There is a common misconception that this issue is local. The fact is the federal Fair Housing laws prevent discrimination and most “gut feeling” criteria are used to discriminate. I would argue that any landlord that does not take the first tenant that meets their criteria discriminated and is potentially liable. If a landlord wants criteria to be a factor such as a lease length or if the tenant smokes it should be in the written criteria. If your factor is subjective, car cleanlienss then this may be a legal gut feeling but good luck to you defending yourself against HUD if that person met every objective criteria but was part of a protected class but that person lost to a “cleaner” non-protected class renter.

  13. John Murray

    I rent to tenants on a first application / submitter / approval basis. Can they pay the rent, is a big criteria point. The next is their credit score. I have seen some pretty low ones in the millennial generation that I have approved. Some criminal backgrounds are an eye opener, but main criteria is income and credit score. So for me first application submitted , income and credit score. Can’t go south on any of those standards.

  14. John Teachout

    We send out a tenant profile to everyone before we will show a property. It lists our restrictions such as non smoker, no cats, min 600 credit score, minimum verifiable income, and so forth (varies with each property). Most people I send our tenant profile to I never hear from again. I have a property now that has had over 300 inquiries and I’ve still not approved a tenant. Had only one completed application and turned it down just this evening. My gut feeling was to rent to this prospective tenant but the data was screaming NO NO NO. So in this case, I went with the data (tenant score of 251)
    Also, a lot of dots didn’t connect. This always concerns me. (so maybe it was a gut decision) At any rate, selecting tenants isn’t easy by any means but is probably the most crucial part of landlording. Selecting a paint color someone doesn’t like is minor compared to placing someone that either trashes the place, doesn’t pay rent or both.
    I’ll leave a property empty for months if needed rather than place a bad tenant.

  15. Ted Carter

    John
    I send out a renter profile also. It has 11 questions. The most important one is “what would your current LL say about you”. Why is it that most, about 90% do not fill out the questioner? This is a Yes-No -brief explanation maybe take 5 minutes. But all the inquiries request a walk through. Go figure.
    And as far as gut. You need that and every type screening strategy you can use. Been doing rentals for 20 + years. I call it acknowledging red flags. And now days you need to use every instinct you have to eliminate the BAD renter.

    • Careful with that current LL thing. I know landlords that give glowing references for a current tenant just to get rid of them. Corporate owned appt. building managers are notorious for that. I go back three years or more. I don’t even rent to anyone who has only one rental under their belt.

    • Katie Rogers

      Maybe 90% of applicant’s won’t fill out your questionnaire because it is too invasive. As far as the what would the current landlord say about you question goes, when I was a tenant EVERY landlord I ever had would be able to say that I was a great tenant who always paid on-time, usually a couple days before the rent was due, was very quiet and left the property near move-in ready it was so clean. But will they say that? Who knows? They might choose to rag on me because I was a dissatisfied tenant (which is why I left) in the first place), and most landlords blame the tenant rather than self-reflect. Most new landlords will believe a complaining landlord, so even if the tenant is accepted, the new relationship is poisoned from the start.

      I do talk to landlords, but since I have been through it with landlords myself, I know which landlord comments to take with a grain of salt.

  16. Casey Culver

    A city or state ordinance where I’m required to rent to the 1st person who qualifies, ironically, is going to end up hurting the people that the ordinance was partially written to help; folks with low(ish) credit scores, like 580 – 620. As a landlord, if I know that I HAVE to accept someone if they qualify, my first reaction is to raise my qualifications. Now, instead of 620, I would require 640. There are a lot of people in the low-mid 600’s that would make fine tenants, but you would have to look at the credit report piece by piece to determine that. This ordinance eliminates a landlord’s freedom to do that and, consequentially, a lot of would-be borderline tenants don’t get a fair shot.

      • Casey Culver

        Katie I absolutely agree. In my experience many foreigners tend to make great tenants because 1) If they break the law with a visa status they may not get to stay and 2) A lot of foreign countries do not have a “debt” or “paycheck-to-paycheck” culture that USA has.

        Let me give an example to demonstrate my point. Let’s say Mr. Kim from South Korea has been here for 4 years, never had a credit card because he doesn’t need one, only has solid rental history, has good income. He would make a great tenant!
        Now take Mr. Smith, born and raised in the USA. He has a bad credit score because he’s irresponsible with money, pays no bills, has 10 collections agencies after him, debt has been increasing despite the fact he BARELY makes 3x rent cost.

        If a city/state ordinance was written saying I have to take tenants in chronological order, I have to raise my qualifications because I do not want Mr. Smith in my property, period. So I raise my standards to minimum credit score of 640, I’ll still find a tenant, it just may take a little longer. Who got screwed? Mr. Kim got screwed because he no longer qualifies…not because I don’t want him in the property, but because I don’t want Mr. Smith in the property.

      • Anthony Wick

        What is the percentage of people with no credit score, are not U.S. Citizens, and are also “great tenants”. My criteria is 600+ credit score. If you are a “great tenant” and can’t show that, then the next landlord should accommodate you, because I am not.

        • Katie Rogers

          I don’t think that anybody know the percentage, but long-term foreign tenants tend to be great tenants and have no credit score. Besides the credit score is not actually a measure of financial responsibility It is a measure of how profitable you are to credit card companies. My credit card balance is zero every month which fact is listed as a derogatory item on credit report. the credit report will tell you nothin about whether the tenant is clean and quiet.

  17. Patrick McEvoy on

    If you read Marcus Buckingham’s article in the Harvard Business Review (https://hbr.org/2015/04/reinventing-performance-management) you’ll see overwhelming proof that as humans we are TERRIBLE evaluators of other people. Most of an evaluation is actually a reflection the biases of the evaluator and not the person being evaluated.

    I like this blog post, as it gives me good things to check for that maybe I wouldn’t have thought of. I think it is totally rational that an owner should be able to come up with a set of requirements for any renter, but that beyond the scope of those minimum requirements, should not be able to use their gut on anything else. I do NOT mean don’t do your due diligence. Your gut tells you something is up, yes, go investigate.
    But your gut is telling you way more about you than it is about the person in front of you.

    • I sure that the military and security forces of the world order will take issue with every bit of that article.
      Evaluating organizational efficiency isn’t the same as relying on an ability to measure a person for fit. It’s the friend or foe thing. It’s at the root of every first meeting between humans…..’who are you and why should I care?” No list of requirements for that. Body language tells 80% of what a person is thinking or intending….no list of requirements for that either. People who don’t observe body language make way more mistakes evaluating situations of people than those who do….and it’s a fact that some are better at it than others. They make the best salespeople.

      Everyone posting here seems to say they endorse some version of using a metric of requirements as well as some gut measure when evaluating for a tenant. It comes from the results obtained…the experience of not getting what we want. Humans have a dedicated neural system that processes relevant information thus allowing quick and accurate decisions. This ability has developed over thousands of years as a mechanism for survival with early detection of danger from others and their intentions, providing a person the time to fight or flee. Some are better at it than others, but then nothing is perfect….including having a list of requirements, but like anything of value, both the requirements get modified based on results over time as well as the reading of people, which also improves with use. Studies by behavioral psychologists have shown this to be true. What your article is based on are studies of large businesses organization data collected by the Gallup Organization that resulted in two books….First Break all the Rules by Marcus Buckingham (see what I did there) and the Strenthsfinder series …both focused on improving organization efficiency and productivity through better fit of people and talent…ie: lean and mean.

      Bottom line, those who apply themselves out of want or necessity usually get pretty good at determining the intent of others through the use of their senses and reasoning. Those who rely on reasoning alone….(the list makers)….don’t.

Leave A Reply

Pair a profile with your post!

Create a Free Account

Or,


Log In Here