Glen Allen, VA · Member since 2013 · 17 posts · 1 vote
Hi I closed on a house in mid December and was trying to rent the place out by Jan. 1st. It's 12/27 and all the work needed is done and it's move in ready. I have had multiple showings but have found no suitable tenants except one guy who said he would rent it if I let him start the lease on Feb. 10th instead.
He seems qualified, wife is studying to be a doctor.
What would you guys do? I don't have any other applicants interested right now so I was considering it. :/ But the downside is i would lose a month and 10 days of rent. But i could lose even more if I say no and he doesn't want it and I don't 'find someone else....
I would recommend that he put down a deposit to reserve the space and have them sign a document that indicates the deposit is non-refundable unless you choose to not rent to them.
example: on my properties i'll make potential tenants who want to hold the place put down $200 (rent is $1200) that will go towards their security deposit. If I find something in their background, i will return the money to them and move on.
if they call me up and say they've found a new place 2 weeks later, they forfeit the $200.00 and it's mine to use to re-advertise the space ect.
I would NEVER take a property off the market for 2 weeks for $200. In your example you've just lost $400 rather than gained $200. You gave up 2 weeks of potential rent for a meager $200 and you're back to marketing the property again. You've wasted your time and lost $600 in potential rent for a $200 fee. I always collect the full security deposit (one month's rent) prior to taking a property off the market.
Real Estate Agent · Milwaukee, WI · Member since 2010 · 129 posts · 24 votes
12y
I would recommend that he put down a deposit to reserve the space and have them sign a document that indicates the deposit is non-refundable unless you choose to not rent to them.
example: on my properties i'll make potential tenants who want to hold the place put down $200 (rent is $1200) that will go towards their security deposit. If I find something in their background, i will return the money to them and move on.
if they call me up and say they've found a new place 2 weeks later, they forfeit the $200.00 and it's mine to use to re-advertise the space ect.
Real Estate Investor · WI · Member since 2013 · 125 posts · 33 votes
12y
OR, Tell them You'd love to have them! But They'd have to pay the full amount for Feb. It's Your policy. Then do leases and deposits immediately for Febuary.
It's a compromise. Maybe worth it this time of year. You have to decide.
You could also offer to leave utilitys in Your name untill they actually move in, for an added bonus if needed.
Rental Property Investor · Denver, CO · Member since 2013 · 4k+ posts · 2k+ votes
12y
I would run a rent special for January right now something like Jan rent for $99. Might pickup someone looking to move Feb 1. They will then pay the $99 for Jan plus utilities. Feb 10 is too far out for me. Ramp up your marketing. You need people to move in sooner.
Real Estate Investor · Saint Petersburg, FL · Member since 2013 · 1k+ posts · 951 votes
12y
If you have no other prospects I'd probably be willing to hold until Feb 1st at the latest, maybe that's a comprimise that would be acceptable for the tenant.
I would recommend that he put down a deposit to reserve the space and have them sign a document that indicates the deposit is non-refundable unless you choose to not rent to them.
example: on my properties i'll make potential tenants who want to hold the place put down $200 (rent is $1200) that will go towards their security deposit. If I find something in their background, i will return the money to them and move on.
if they call me up and say they've found a new place 2 weeks later, they forfeit the $200.00 and it's mine to use to re-advertise the space ect.
I would NEVER take a property off the market for 2 weeks for $200. In your example you've just lost $400 rather than gained $200. You gave up 2 weeks of potential rent for a meager $200 and you're back to marketing the property again. You've wasted your time and lost $600 in potential rent for a $200 fee. I always collect the full security deposit (one month's rent) prior to taking a property off the market.
Glen Allen, VA · Member since 2013 · 17 posts · 1 vote
12y
@Alex Anderson i was about to say i would start doing that but then as I was responding I saw @Patrick L.'s response and he does have a good point.
I will tell him I'd be willing to start the lease on Feb. 10th as long as his application and everything passes and the lease is signed. And until then keep showing the house until I get a lease signed with security deposit and first month's rent in my bank.
He asked me to meet him halfway because his lease ends Feb 28th. I think it's a good sign that they are looking and planning ahead of time vs someone who wants to move in ASAP. And hopefully they will be responsible tenants as well. Responsible people would secure a place sooner and have their ducks in a row well before their lease ends. I am thinking I don't want any of the people who are in the OMG NEED PLACE ASAP now category.
@Bill S. 99 cent rent in jan. sounded like a good idea initially to get some people interested however that still makes me lose the month of Jan's rent vs starting the rent in Feb for this couple that seem very responsible. I am getting calls but I had to turn away a lot of people due to them not meeting our min. credit score. A lot of them have very bad credit and one of my phone screening questions is: "Do you have good credit?" And some of them tell me they have some issues...so then I tell them our min. credit score is 650.
Do I need to tell them that? I'm not sure what to say when I ask the question and then they respond that they have had some issues in the past.
Racine, WI · Member since 2013 · 24 posts · 6 votes
12y
I agree, get the deposit up front with proper documentation. If he doesn't want to pay it then he isn't serious. Also do the background checks before you take his deposit. People aren't always as they appear. I have learned not to be in a hurry to rent your place out. Lose one months rent before you take someone without doing the background checks. It will cost you much much more if you have to evict someone down the line.
Dallas, TX · Member since 2013 · 4k+ posts · 744 votes
12y
Credit scores don't mean anything. Most new landlords push the credit score thing. Be concern if they have evictions, criminal history, do they have income to support the rent the rest doesn't mean anything.
Rental Property Investor · Denver, CO · Member since 2013 · 4k+ posts · 2k+ votes
12y
@Jennifer H. I don't follow your thinking. You seem to be seriously considering someone for Feb 10 to START paying rent and utilities but are concerned about reducing rent for Jan with someone else paying utilities. There are other good tenants out there. Keep marketing. You are selling out too soon. Patience, there are other good tenants out there and the past few weeks were not a good time to find them. BTW it's $99.00 rent. I actually use $199.00 but what ever. This deal only goes for the very best applicants.
I totally agree with @Account Closed . Credit score is way over rated. My best long term tenants have a lower score but great rental track record. Low score means they can't buy which is where I lose all my tenants with a good credit score to. BTW I don't consider a 600 score to be "good". There are many with 600 that are living on the edge and will end up bringing you down with them. There are some with a 600 that will make great tenants. You don't know though until you dig in and learn about them.
Real Estate Investor · Audubon, PA · Member since 2009 · 13k+ posts · 8k+ votes
12y
At this time of year I would be willing to accept somebody to move in for Feb provided they qualify. Especially given Jan 1 is within a handful of days away.
But I think you are trying to set too high a standard for tenant qualification based on a credit score number. Many renters will have items in collection for things like medical bills that have little bearing on whether they pay their rent, but those collection items kill the credit score. Some links below for you to ponder:
Real Estate Agent · Milwaukee, WI · Member since 2010 · 129 posts · 24 votes
12y
@Patrick L. you are absolutely correct! that would be silly to forego that additional revenue. I should have mentioned that when showing soon to be vacant units, they are currently occupied by the current tenant. Because I am near a University, I tend to get a lot of interest and applications around May and August.
Investor · North Wales, PA · Member since 2013 · 116 posts · 44 votes
12y
I would be fine holding it a month provided that they put up at least a Month's rent now and signed the lease. Then last months rent and security due the first day of the lease when you hand over keys.
I would consider January lost but would try to get them to start Feb 1rst, considering your position though, I wouldn't go nuts over it. Maybe give them a discount for Feb if they start on the first and move utilities to their name at start of month.
I like the idea of compromise of putting at least utilities in their name at beg. of Feb. The sad thing is, they negotiated so hard and then in the end they haven't given me their application yet! Bahh! Lol. Hopefully I get some more bites next week. There is another unit nearby who is renting for 1250 but they don't have a washer dryer. I am renting for 1275 so I guess we'll see. :( When do you guys think I should lower the rent if I still don't have someone in by? Here's my ad: