Can you ask about child support payments?

Question

Hi everyone,

My M2M tenant just informed me he went to court on Monday and now has to pay $476/month for child support. Rent is $450/month. He said he just wanted me to know things might get tight. I said I'm sorry to hear that and i hope it works out. Good thing you are on m2m and can just give notice if things go south. Also told him to keep in mind late fees are expensive and will add up quickly. I was basically letting him know rent is a priority for me and should be for him as well. I hope I handled it well. I'm wondering going forward, is it ok to ask about child support obligations etc when screening. Even if they make 3x the rent? Thanks BP fam!

Anastasia Jordan · Answer

Are your requirements 3x the rent for the gross or net income?  Most non-custodial parents who have court order childsupport have it garnished directly from their paycheck so it should show on the check stub.

Thomas S. · Answer

Don't know if it is OK to ask or not but as a responsible landlord you need to know every applicants fixed expense's and therefor should be asking regardless of the rules.

Audrey Ezeh · Answer

Thanks Jennifer, I appreciate that! Yeah I tried to be as kind as possible but firm. He did get the message and a couple of days later he paid partial rent (via cozy) and told me he had the rest in cash. I told him unfortunately I do not accept cash and he went to my bank and paid it the very next day. He is only 18 and boy he is discovering that 'adulting' is very hard lol so I am trying to be kind to the kid. I told him he is young and he can hustle so if he needs to, he can get a second job so he can sleep easy knowing he can meet all his obligations.

On a side note, the mailbox is in bad shape and not very secure and I kept forgetting to go replace it. He told me his mail was on the ground that day and I ran out and bought a new mailbox, a new 4x4 post, painted it and installed it in 2 days. He was falling over himself with gratitude and surprise. I told him listen, you have your responsibilities as a tenant and I have mine as a landlord and he seemed to appreciate that sentiment.

Anyway...so far all is well. Speaking of adulting, landlording ain't easy either as I am discovering :)

Rick S. · Answer

Thanks Chris as I saw another thread where a person said the regular payments do appear on his credit report, however I just confirmed with TransUnion that only delinquent child support would be reported.  Sorry about that.

Stanley Parsley · Answer

another thing to consider before you add a bunch of questions to your screenings

you have to play in the everyone gets a gold star for participation arena

that means if you question someone about certain topics when it comes to there financial well being you may end up in court

a lot of the rental questionnaires are controlled and monitored by state

they are a lot like the employment applications and the referral calls after a person has been fired from a job, if you ask certain questions you could end up in hot water be careful and have a attorney look over your lease agreements in the state you are doing business in

enjoy

Chris Mason · Answer

We're allowed (required, actually) to include child support obligations in our DTI calculation. That generally indicates not a protected class when it comes to housing, at the federal level anyways, because Fannie Mae guidelines can generally be assumed to be compliant with federal equal housing laws.

(FHA/VA, ironically, you cannot make that assumption about compliance with the law)

Chris Mason · Answer

Not always. If they are/were late, things happen in a courtroom and poof it appears on a credit report.

But folks that pay on time, it tends not to appear at all, at least local to me. Often it's the paystubs that tips us or underwriting off.

Patrick Liska · Answer

Audrey,

You handled it right, let him know that you will not cut him any slack because of it and that you have no problem charging him for late fees or letting him leave if he can not make payments. @Rick S. brings up a good point, is the payer of child support considered a protected class, like the receiver of child support payments ? not 100% sure on that, but that is a dept that should be on their credit reports and a factor in whether or not they can afford to pay the rent. you can not deny a person because they pay child support, but you can if their overall DTI ratio, with the required support payments, does not meet your requirements for a tenant in your place ( make sure you have some number in your companies operating agreement as a minimum you will allow) just in case a suit ever comes up, your company has a min standard amount .

Rick S. · Answer

@Audrey Ezeh I believe the child support payments would show up as a tradeline on the credit report for the person along with the monthly payment amount.

I don't see why you wouldn't also be able to ask applicants about it, however it would have to be consistent for all applicants.  I know some states consider the source of income a protected class if you are receiving Section 8 or Child Support payments, however this is the opposite where the person is submitting payments so I don't see this as a protected class question.

Jennifer T. · Answer

I could see this potentially being fine if (though, not a lawyer!), on the application, there is a section asking about fixed expenses.  Like loan payments, credit card minimum payments, child support payments, etc.  So it's focusing on DTI, but not necessarily child payments, per se.

Let's face it.  A tenant just barely meeting the income requirement could run out and lease a brand new BMW for $600/month.  Or, less frivolous, they have to go in for emergency surgery and suddenly have a big bill from the hospital with a $500/month payment plan.

Stuff happens all the time that can turn an otherwise good tenant, into someone now having trouble paying their bills.  On a positive note, the tenant gave you a heads up about what is happening.  I think your response was great.  Sounds like you were sympathetic, but nicely and firmly made it clear that his new child support order does not give him leeway with rent.

Can you ask about child support payments?

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