Accept or Deny or Compromise?

Question

I have a tenant application today who paid the application fee. However, he said he cannot pay the deposit until next Friday and the first month rent the Friday after, the day he would move-on. The credit score and references are great. I am worry he might just live paycheck to paycheck. Should I:

1 - Deny the application

2 - Accept it and sign a lease now and receive the deposit/1st month later (maybe I cannot show my place int he meantime though)

3 - Compromise: sign a lease now contingent to receiving the checks for deposit/1st month and still show the place to others?

Patrick L. · Answer

I also wanted to add that you should NEVER sign the lease until you have all of the funds from the tenant. Even if you wanted to approve this application I wouldn't take it off the market or promise it without at least the security deposit in my hand. I would tell the tenant that he is approved (but in this case I'd flat out reject) but I will continue to show the property and reserve the right to select a different applicant until I receive a non-refundable deposit (the security deposit) to hold the property.

Once you sign the lease you have a tenant, whether you've collect the money or not, and you cannot rent it to anyone else. That tenant has a lease and can begin moving in upon the start of the lease even he hasn't paid you and you would have to evict to regain possession of your property.

Once you sign the lease you have a tenant, whether you've collect the money or not, and you cannot rent it to anyone else.  That tenant has a lease and can begin moving in upon the start of the lease even he hasn't paid you and you would have to evict to regain possession of your property.

Bill S. · Answer

@Matt Smith  - NO NO NO. He has had an eviction. Unless you are renting a D-class property in a D-class neighborhood to D-class tenants there should be no reason to take an eviction. History says he will stiff you for rent.

Classic bait and switch with the move to the girlfriend. EVERYONE living in the unit over 18 must sign the lease, must be screened and must pass the screening process.

Chances are very good that this couple is going to give you a first class education and it is going to cost you big time.

Remember this, a vacancy is a blessing compared to a bad tenant. This guy has "bad tenant" written all over him.

You don't sound like you have a lot of experience as a landlord. Find a tenant with No evictions and then move forward.

Patrick L. · Answer

Is it actually the landlord is a friend posing as the landlord?  I'd check public records and confirm the person you're talking to is the owner.  I've also seen current landlords give positive references to get rid of a trouble tenant because it's easier than an eviction.

Patrick L. · Answer

Easy pass.  I don't care about credit score but if people can't pay their rent then that's the point where I start caring.

First red flag is he has NO money now at all to hold the place.  People that have no money at all when they're looking for a rental will probably have no money again at some point when the rent is due.  He has a prior eviction and will most certainly have a future one, do you want to be the next landlord that has to evict him?  Keep looking.

Matthew Paul · Answer

They both sign the lease , what happens when the girlfriend moves out after the first month?????

Marcia Maynard · Answer

I would choose option 4: Accept his application and tell him you will process it this week.  If he qualifies, you will offer to rent the unit to him and will expect a holding/security deposit no later than Friday October 17 (less than a week from when you offer to rent) and will expect him to sign the lease and pay first month's rent on Friday October 24... the day his tenancy will commence.

His current cash flow situation may or may not be indicative of his future cash flow situation. I wouldn't worry about it. If it concerns you, talk with him about it. However, realize that it is not uncommon for people to have extra expenses when moving from one home to another, which may be one reason he can not pony up all of the money at once. I don't see his request as unreasonable. At least he is being open and honest with you.... that's a good sign. Just make sure all money is paid prior to handing him the keys.

Account Closed · Answer

Absolute pass. Shoplifting = dishonest. I would not accept a past eviction either. And full rent should be paid BEFORE move in. I agree with other posters, it will cost you less in money, stress, and time to wait for the right tenant. I speak from experience on that. Good luck and you were smart to ask for input on this.

Walt Payne · Answer

@Matt Smith  I think the most important thing you need to do here is evaluate what your criteria are, and why. Knowing why helps when making decisions so you understand how to evaluate borderline cases.  Some of the criteria used by people matter more in Class A and less in Class B,C or D. Some always matter.  As others have said, look at the property type, the best tenants you are likely to get, and go from there. But it is also important for many reasons to set firm, unyielding criteria. Why? Well two very good reasons. Bending the rules usually means "settling" for something less out of desperation. Bad move, it also means problems more times than not. The other important reason has to do with discrimination laws. You need to be able to show that you accepted/rejected tenants based on consistent factors. Otherwise you are opening yourself up to criticism and possibly losing a lawsuit. A few important things to consider:

Does credit score really matter? Personally I think it only does when you get into the really low numbers. If they have no evictions and a few years of rentals they probably are typical in considering shelter the priority, even if they stretch their income a bit thin.

Do evictions matter? If so do you allow an exception after x years?

Do convictions matter? What kind get no exceptions? What kind get exceptions after x years? Personally violent crimes and sex offenders are generally lifetime no for me. Exceptions that I would make - sex offenders who were 18-19 and got charged with statutory rape with an over 16 yr. old ... after 5-6 yrs. without incidence.

Income ratio: Evaluate and set it and make zero exceptions, or expect to regret it. Unless of course you accept Section 8.

I suggest you require payment of deposit upon signing, first month rent before they get keys.  Again, no exceptions. Depending on state and local laws, find out if you might be able word the lease so that deposit is not refundable if they bail, but you do not need to do an eviction. Not all states allow that kind of thing but if they do, get it in your contract.

Always include all adults living at the property on the lease. Always require that all of them meet the requirements. Always make sure your lease says that they are all responsible, together and separately, for compliance with all terms of the lease. Otherwise if the "responsible one" moves, you are left with someone less than acceptable as a tenant.

Justin Escajeda · Answer

Judging by what his background said, I'd deny him if I was putting him in one of my houses or apartments.  If eviction pops up, I don't care how long its been, that's a no for me.  However, if he was going into my mh park, I probably wouldn't care.  Credit score is not a huge indicator (for me) that the person is going to pay or not, people get their credit screwed up sometime and its a long, uphill battle to regain it.

Like I said, in a background check I care about evictions, megan's law, and major felons.  What kind of area is this rental in?  How much a month?  Whats your target tenant?

One thing Ive learned is that you may find a great tenant, but they might not fit in a certain area where the rental is located (EVEN IF THEY THINK THEY WANT TO LIVE THERE! - Ive made this mistake before).  For example, you cant put a single post grad girl from the suburbs, in the ghetto - believe Ive tried.

My mobile home tenants (in one area), are flirting with the poverty line; government assistance, food stamps, etc.  However, in most cases, they are out of options after my place.  Therefore, that is the leverage that I use to make sure I get paid, month after month.

There's nothing worse than moving someone in and moving them right back out in 2 months.  Then you have to clean everything again, show it to more people (who half the time don't show or call for appointments).  Call references, use your gut instinct too, will they fit in this area??? @Marcia Maynard is right, moving is an expense that can really through off someone's monthly budget.

If you accept him, Id get everything signed, but not start the lease (and give keys) until the final week where all his $$$ is paid to you, tell him you'll hold it until you guys are square.

John Thedford · Answer

No thanks! Find a better qualified tenant. DO NOT be in such a hurry that you accept someone you know has a bad history. History does repeat itself!

Accept or Deny or Compromise?

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