Tenants interested, smartmove not helpful. What would you do?

Question

I have a couple interested in a unit. They did a smartmove credit check, and both came back with "Not enough info".

They make well in excess of the rent, about 5 times. Verified income.

But there's no credit cards, no late bills, no loans, no anything to judge them on.

On the plus side, no criminal history or eviction history. All a-ok there.

References check, and all else looks good. But smartmove won't give a recommendation.

They seem nice, but we all know how that goes. Googling them shows nothing unusual, no odd FB or G+ accounts.

What would you do?

Dick Stevens · Answer

Ask for a co-signer on the lease with verifiable credit.  And Tom, not having a credit card is silly.  You're missing out on valuable rewards.  Just pay the bill in full every month and you never "pay more for something than it costs".

Jeff B. · Answer

Over many years, I have  seen several of these kinds of applicants - - no credit history at all;  no bank or credit unions, no credit cards, but still have valid driver's license.  There are two groups that come to you like this:

• ethnic/cultural types where All-Cash is the normal way of doing business.  With so much online sales these days, it's hard to imagine, but true none the less.
• the other is those who desire to be 'untraceable' and these raise our concerns.

How can you tell one from the other?  That's rough to do.  I find families with other ethnic backgrounds to be safe - - he want's to provide for his family and DOES SO.  The singles are most difficult.  Run a background check when possible, verify employment and the last two addresses of residency is about all you can do.

Thomas S. · Answer

I prefer to fault on the side of caution when in doubt. There is defiantly something wrong with these applicants.

Continue accepting applicants.  When someone else qualifies inform them another more qualified applicant has been approved.

If you accept them make sure you only offer a M2M lease, you want to be able to get rid of them if it doesn't work out. If they refuse to sign a M2M lease you probably dodged a bullet.

Charlotte Edwards · Answer

Dave Ramsey is a proponent of people renting while getting out of debt/saving up for a down payment and he tells them to cut up credit cards/not to borrow money...so it's entirely possible that they are following this plan or a similar one...especially since everything seems to come out favorable. I'd try asking a few more questions relating to their rental plans...just a year...a few years? Since they make well in excess of the rent, with verified income, I think that's a good sign.

And yes, cultural differences might be at play, but I think it was said that these people are Caucasian. In China, nearly everything is done with cash. Parents pay their kids' yearly tuition in cash; we paid a year's rent in cash all at one time. Heck, even our house was bought with cash. Here it's the norm to save up for stuff and then buy it. Not on credit or with a bank loan.

Jeff B. · Answer

It's your call, but I would go with them.

Tom V. · Answer

Thanks for that link, Jim. I am going to give that one a shot as well.

As far as no credit history, yes, it's rare and confusing. However, a couple of you have mentioned no credit cards.

I myself do not have a credit card. Why would I? Why in the world would I ever actually pay MORE for something than it costs? (item + interest - obviously properties excluded from this personal rule)

A second point of note, I have never, and will never, purchase an item I cannot pay cash for. (again, properties excluded, as well as vehicles in this case - talking credit card stuff here)

I do not believe in credit cards, and will NEVER own one. Ever. They are completely useless and irrelevant to me.

And I'm just a standard middle-aged caucasian. I just believe in fiscal responsibility and budgeting. If I can't afford something, I save longer, or I don't need it.

So yes, the lack of any credit history whatsoever is troubling, but credit cards are NOT the issue.

Yes, there was a mismatched address, however it verified it to be an actual previous address. Transunion has not updated it.

I am familiar with that, as transunion still has not updated my own address from one I lived at 12 years ago, and still lists current employer as one I worked at when I was 18-19, back in the 1990's. Wow. In fact, transunion has a name mismatch on my file, which has caused me numerous issues over the years. They say I have an alias, with my real name as my father's last name. I disputed it, and they confirmed it and denied my dispute. ????No idea how, but I am obviously not a dead 65 year old man....

There were no other fraud indicators on their file. SSN was good, name was good, everything else was perfect. Employment verified. ID's verified. Income verified.

Mid 30's, caucasian. Both of them.

And while I can understand no credit cards, as stated, there is no history at all. No loans, no car payments, no house, no late anything, nothing. Just blank.

I pulled from another bureau, and there were a couple of 75 dollar late medical payments, but closed paid. That's it. Everything else blank, as before.

I traced them back 7 years, as far as employers and addresses. Before that, nothing. I've never seen  his before. I've had 18 year old applicants with a credit history. I have never seen nothing.

Unfortunately, I can not ask for an additional deposit, the state limits what I can collect to 2 months, and I am already requiring that.

Jim Adrian · Answer

@Tom V.

I have not used smartmove so im not familiar with it.  Could you deny them for incomplete information when filling out the smartmove due to the nature of result finding of "not enough info".  You can consider this and incomplete application which is deniable and not discriminating.   If they are making 5x the rent and no credit cards hence no credit history something is fishy.   I would pass on them.   Are you sure the criminal history and eviction is correct?  I have used www.tenantbackgroundsearch.com if you want to try another search on them.

David Dachtera · Answer

@Tom V.,

Here's one most people don't think of, but may useful in your case.

Ask them to subscribe - temporarily - to a credit monitoring service such as ScoreSense (CheckMy3Scores) or CreditCheckTotal. MyFICO would be preferable, but is the most money. ScoreSense provides Vantage scores. CreditCheckTotal and MyFICO provide FICO-8 scores; both provide info from all three bureaus.

Then, have them come into your office, log into their account on your computer and download their credit report as a .PDF. This will be a "soft pull" with no impact on their scores.

Now, granted, this does require you to be able to read a credit report. If you need help learning, I can refer you to someone. There you will be able to see the "raw data" rather than a "digested" form. You'll see whether there is any negative info (only goes back a bout two years, however). The reports in that form also may provide a summary of what in their credit history is working in their favor and what's working against them. Sounds like they may have an issue with a lack of credit history.

Bear this in mind about credit scores: they're a numerical representation of someone's likelihood of going 90 days late in the next two years. Vantage scores are actually more predictive of that than FICo because the Vantage calculations take factors into account which the FICo formulas do not.

Dunno if that helps ...

Colleen F. · Answer

Are they  from the US?  how old are they? I have had not enough info on young tenants but never no recommendation   or no info.   I would try to lean on the accuracy of their data vs what they told you and any verifiable landlord references. You can protect your interest with a bigger deposit (if legal in your state) or more pre-paid rent.

One critical part of this issue though is to verify they are who they entered into the system. Address match. Age match, if new grads I look them up in the university directory. If too young you could go with cosigners.  Did you copy their license and does it match where they say they are living or where they came from?

Rick S. · Answer

@Tom V. were there any Fraud Indicators, such as a mismatch reported for the SSN or address?  The Address Mismatch is very common but if there are any other fraud indicators that may indicate either an issue with their credit file or the SSN they are trying to use.  I have only seen a few people not have a credit file or score through SmartMove.  Did you ask them if they should have credit history?  Any inquiries at least?  Thanks.

Tenants interested, smartmove not helpful. What would you do?

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