Approve This Tenant?
House has been vacnt two months plus. Had to lower rent over 10%. Now I have two prospective tenants who are very interested.
They have terrible credit, have been in Bankruptcy, foreclosure and have 3 judgements against them.
Former Landlord says they are very clean and good tenants for the area. No lates, no damage to his unit. Employment checks out.
Is there anything else I need to look into? I am leaning towards approving them regardless of the credit since they apparently pay their rent and that is what I should be concerned about, right?
I should point out that there are slim pickings in the current market out here.
Thanks,
JS
Do more checks to see if there is any pending
judgements or Garnishment of wages. These
can be checked at the courthouse.
Skip the current landlord.
Their statement will have to be
taken with a grain of salt.
Make sure that the so called landlord that is
vouching for them is indeed the real one. A cross
check with the property address and county record
will reveal that.
Talk to the current
neighbours of your prospective tenants. Try to visit
them and see how they care for the property.
Make it clear to the tenants that you have a one strike
and you are out policy due to their credentials and
you are doing them a favour by renting to them.
Also tell them you can
help build their credit by reporting to the credit
bureau.
Having said that, only decent folks seem to be
worried about all the credit rating stuff. Folks who have
been bad apples are immune to it. Again, inspite of
all the due diligence, there is a possibility of bad
apples making it thru.
My 2 cents.
Krish
I suggest you speak with the most recent two landlords. if they both give glowing reports, chances are you will have a good tenant. i have had very good luck with tenants having bankruptcies, criminal records, etc. when the reporting landlords provide good press.
This site is helpful when verifying pass addresses:
http://www.zabasearch.com/
Thanks for all the replies.
Yes, I am probably in a desperate situation, but I tried to let my desperation play out in the form of reduced rent rather than bad tenants.
I had refused to lower the rent for the longest time hoping to weed out unwanted tenants. However, at the last REI club meeting a number of the more experienced investors who have rentals in the same area indicated that they had been forced to lower rents and accept tenants they would otherwise have not. That is when I decided to lower the rents myself.
I do reverse lookup on the phone numbers I get and I also look up the tax rolls to verify who the property owner is. I have not had many tenants who have falsified information but as Brenda stated, maybe I am not looking hard enough.
JS.
When I get desperate I give a move in special. Usually 1/2 rent on the second month.
Brenda
Brenda,
My post indicated that validity of the landlord is verified. I rarely do this myself. I use a large property management company to find and screen most of my tenants. They do an excellent job on determining the legitimate trail of tenancy for applicants. They also do the criminal background checks, credit checks, bankruptcy, etc. So far, I have not had much difficulty with rental performance or maintenance performance on tenants that have been found after I owned the property. Of course, the notable exceptions make for good stories!
Regards,
Ed
Even if she pays late, if her lease is up in Nov, just offer her a 6 month lease in Nov which will put you into May, an Excellent time to find new tenants.
I agree with nyjosh. My lease does not automactically convert to m-t-m. They have to sign on for another six months, if they wish.