Rental holding fee?

Question

My husband and I found very nice prospective tenants who have both great credits and good employments. Problem is prospective tenants are still under their current lease for a month and now are asking if we could start the lease one week before their current lease ends..but not earlier than that. So we would need to wait 3 weeks before getting rent from the unit.

They are very nice and ready for a 1-year lease. If we agree, what is the habit, should we take a holding fee etc?

Thanks,

Laura

They are very nice and ready for a 1-year lease. If we agree, what is the habit, should we take a holding fee etc?

Thanks,

Laura

Mike F. · Answer

A holding fee? In addition to the lease starting in 3 weeks?

I basically tell people the property is first come, first serve, so if you want to wait 3 weeks to sign the lease, you can, maybe it will be available, maybe it won't, I'm going to keep showing it. If you want it you can lease it now and the rent is prorated. I'm never desperate, but that's my situation, you have to consider what you want to do. Just  don't even think about just holding it for them without a signed lease, payment and security deposit, that would really be bad to hold it for them and then they don't sign.

Joy Remington · Answer

When prescreening tenants, I often ask when they are looking to move. At that point, depending on their answer, I can tell them that we are able to hold the property for up to two weeks for the security deposit. If they agree to this (after full screening, etc), we always sign a holding agreement with them that states the property will be ready for them on the moving date and if they do not move in, the amount is non-refundable. I prefer this to signing a lease because at the lease signing, we go over all the details and exchange keys.

I believe it is worth it to hold a property for a couple weeks for an excellent tenant. I also set a specific time period of two weeks so it is clear up front for them. That also gives me a rule of thumb so I don't hold a property too long and miss out on rental income.

I have had great success using holding agreements.

Margaret Martindale · Answer

I agree with all.of Scott's post.  I also like what Mike said, get the lease signed and a security deposit from them.  What ever you both agree on.  They sound like tenants who hold to their agreement.

Scott Carder · Answer

Sounds like a good tenant. If they could come up with something, even a 100 bucks, at least you would know they are serious.

Nathan Williams · Answer

I dont charge nonrefundable fees but I do require deposit and lease to be signed for a property to be held for a specified move in date.

Laura Hamilton · Answer

Yes, will do the official paper work for it. Decided to ask for 300 $ holding fee, which will become part of the security deposit once the lease is signed in 3 weeks. And if they decide to cancel, we'll keep the 300 $. I think 300 $ is high enough to keep the holding serious.

Andreas W. · Answer

@Laura Reches

Yes, they still can blow you off. They would be breaking the lease but collecting will be close to impossible. I prefer to wait with lease signing until a week before move in. Until then a holding fee needs to be paid that will be turned into part of the the security deposit if lease gets signed as planned. If the tenant prospect bails, I keep the holding fee. I ask for one quarter of the monthly rent for each "holding" week. Obviously, you have to put this in writing with signatures from all parties.

Cal C. · Answer

I won't even consider this without a full month's rent as the holding fee.

Jeff Gates · Answer

I have done this before when there was a line of people at the front door asking for the property and serious. One person agreed and I took the nonrefundable $100.00. You could just tell that most of all of the interested applicants would pass background screening. Of course I did the background screening, they passed and I leased to this applicant.

Cal C. · Answer

it really depend on your particular market and how strong of potential tenants they are compared to typical tenants.  If legal, taking a holding fee (usually non refundable ) and then turning it into a security deposit is an excellent idea.

Rental holding fee?

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