My three biggest concerns when "qualifying" a Tenant/Buyer:
1. Show me the Money. How much $$ do they have to put down? More Money = More Security for me. If they walk they lose their NON-REFUNDABLE deposit and you find another Tenant/Buyer.
2. Do they have a steady job? If there will be two people living in the home, is there dual income? Basically I am looking to see if they can cover the monthly payments.
3. I have a Credit/Background check done with a Tenant Agency for $35 which all my Tenant/Buyer applicants pay for. In most cases I am expecting it to not be in good shape, but I am really only wanting to know if they have had a Disposessery or a Foreclosure. Also, when I take an application I ask them a series of questions regarding their Credit. If it doesn't match what I find in the Credit Report I am dealing with someone with little integrity or maybe a liar. Little Integrity usually translates into BIG TROUBLE.
1) How much do they have to put down
2) Do they have a steady job
3) You might run their credit to see what you are getting in to. You dont expect them to have perfect credit or they probably would be getting a bank loan.
3A) Make sure that if you are looking to get cashed out in 1-3 years that the tenants will be able to qualify for a loan at that time. Check their credit history. If your tenant wont qualify, you can always extend the L/O or you can evict the tenant (According to the lease), keep the consideration fee, and go out and get another non-refundable consideration fee with a new L/O tenant. It is all a matter of preference!
Thanks for the replies. What FICO score do you look for and what % option fee do you seek? Can you recommend a good program that teaches lease option - how is Ron LeGrande's?
Thanks a bunch!
My three biggest concerns when "qualifying" a Tenant/Buyer:
1. Show me the Money. How much $$ do they have to put down? More Money = More Security for me. If they walk they lose their NON-REFUNDABLE deposit and you find another Tenant/Buyer.
2. Do they have a steady job? If there will be two people living in the home, is there dual income? Basically I am looking to see if they can cover the monthly payments.
3. I have a Credit/Background check done with a Tenant Agency for $35 which all my Tenant/Buyer applicants pay for. In most cases I am expecting it to not be in good shape, but I am really only wanting to know if they have had a Disposessery or a Foreclosure. Also, when I take an application I ask them a series of questions regarding their Credit. If it doesn't match what I find in the Credit Report I am dealing with someone with little integrity or maybe a liar. Little Integrity usually translates into BIG TROUBLE.
Have Fun!
Stacey hit it right on the head!
1) How much do they have to put down
2) Do they have a steady job
3) You might run their credit to see what you are getting in to. You dont expect them to have perfect credit or they probably would be getting a bank loan.
3A) Make sure that if you are looking to get cashed out in 1-3 years that the tenants will be able to qualify for a loan at that time. Check their credit history. If your tenant wont qualify, you can always extend the L/O or you can evict the tenant (According to the lease), keep the consideration fee, and go out and get another non-refundable consideration fee with a new L/O tenant. It is all a matter of preference!
Best of Success!
BAMZ
Thanks for the replies. What FICO score do you look for and what % option fee do you seek? Can you recommend a good program that teaches lease option - how is Ron LeGrande's?
Thanks a bunch!
Brad