When do I require a co-signer on rental application?

[Sarah Nguyen]

Hello BP family,

I am new and still learning about the rental business.  Can you please let me know in what situations I will need to require a co-signer on the lease?

My property is in a college town so the chance of renting to students/roomates are high.

Appreciate all the information you can share.

[Penny Clark]

@Sarah Nguyen, make sure co-signer also goes through your screening process (credit check, income verification and rental/mortgage payment history) In answer to your question, I always require a co-signer for any of the following situations:

- If credit score is below minimum set by rental criteria. For example, a score under 600

- If income is less than 3 times that of the rent

- If the applicant does not have an established rental history both current and previous. For example, he/she is currently living with friends or family

If you will be renting to students, it may be wise to get parents to co-sign anyway, particularly if the applicant falls short of the criteria listed above or this is their first experience away from home. Depending on the laws in your state, you may also be able to ask for a higher security deposit to compensate the risk.