Rental Property Investor Ā· Cranston, RI Ā· Member since 2017 Ā· 171 posts Ā· 158 votes
Hi All,
I have my first showing tomorrow for a vacant apartment, and it's a group showing. My question is with regards to application fees. If I get a bunch of people who apply (fingers crossed!), I assume some might get eliminated just from the basics on the form (i.e. lack of employment, landlord references, etc), but for all those who pass the initial qualifications, do you process background checks on all of them and then select the best candidate? Or do people process a couple at a time until you have a qualified candidate and then mail back the fee to those who didn't get processed? I feel bad taking $35 from each person when there is only one vacant unit to fill, but mailing back checks seems like a hassle as well. I'd appreciate feedback from those with some experience in this area!
Investor Ā· Post Falls, ID Ā· Member since 2016 Ā· 606 posts Ā· 699 votes
8y
We only do group showings when we have a vacancy. Bring a friend or partner who knows not to say anything that violates Fair Housing. You only answer questions about the property, do not have the friend ask any questions about family size or where the potential applicants are from. Have your requirements printed out and visible, so that applicants can self screen themselves out, rather than waste an application fee. Use actual $ numbers -- say "to rent this apartment you must have a monthly income of $X,XXX and total move-in money is $X,XXX" rather than "you must have an income of 3 times the rent". Do not expect applicants to do math. Charge an app fee high enough to discourage the unqualified from applying, but accept applications from all. Let applicants know that you WILL run credit/criminal/eviction checks -- you are not just collecting app fees to line your pocket.
Bring a computer printer/copier to the showing. Ask applicants to bring a copy of their government issued photo ID and a paycheck stub to the showing, if they are interested you can copy right then. We collect app fees at the showing, run applications and refund the app fees to those who qualified if we rented to another. We have a standard feel good letter we send to qualified applicants who just did not get the apartment due to only having one vacancy.
In my experience, the people who have to "think about it" are the ones who realize they will not qualify and say that to save face. You will never hear from them again. The applicants who know they qualify and want to rent the property, will be very eager to get their app fees and applications in.
Real Estate Broker Ā· Naples, FL Ā· Member since 2013 Ā· 9k+ posts Ā· 6k+ votes
8y
I charge $75 per application. I also hand out a qualification requirement letter during time of showing. The people that can't qualify aren't going to pay $75. Once I have 1,2,3,4...no more than that, I look over everything and try and decide who appears to be the best candidate. If I run that person and approve them, I send back the other application fees. Only once in five years has someone forfeited the fee and not been approved. The reason I charge $75 is to weed out the true prospects from others that know they won't qualify.
Rental Property Investor Ā· Huntsville, AL Ā· Member since 2013 Ā· 419 posts Ā· 323 votes
8y
I personally do not take checks. Money order or cash only. I'd be interested in how your group showing goes. In my experience, the least qualified person is in a rush to get the app filled out and the qualified ones move on quickly. I had to convince someone who eventually became my tenant to stay and fill out the app as another applicant talked loudly about how they were getting my rental. I run credit checks in the order they are received and stop with the first one that meets my criteria. Refund those who don't get checked.
Rental Property Investor Ā· Cranston, RI Ā· Member since 2017 Ā· 171 posts Ā· 158 votes
8y
@John Thedford - I have a listing of qualifications on paper to present with some details about the property for that exact reason...they won't waste their money (even if it's just $35) if they know they don't qualify. Thanks for confirming that you send back the fee if not processed. It seems like the only reasonable thing to do.
@Mike S. - good idea with not allowing checks. I was wondering what would happen if the check bounced, as it wouldn't be until well after I process the background check and figure I'd be stuck with that cost. I'll probably follow suit with your suggestion with what forms of payments to accept next time. Thanks!
Rental Property Investor Ā· Cleveland, MN Ā· Member since 2017 Ā· 518 posts Ā· 354 votes
8y
I don't collect application fees. If someone applies I check out their application, verify their references, and then if they get past that part, they get an email from SmartMove. They pay the $35 fee to SmartMove and I get the background/credit check via email. If/when they get approved and move in, I subtract $35 from their first month's rent.
I have my first showing tomorrow for a vacant apartment, and it's a group showing. My question is with regards to application fees. If I get a bunch of people who apply (fingers crossed!), I assume some might get eliminated just from the basics on the form (i.e. lack of employment, landlord references, etc), but for all those who pass the initial qualifications, do you process background checks on all of them and then select the best candidate? Or do people process a couple at a time until you have a qualified candidate and then mail back the fee to those who didn't get processed? I feel bad taking $35 from each person when there is only one vacant unit to fill, but mailing back checks seems like a hassle as well. I'd appreciate feedback from those with some experience in this area!
I would recommend only accepting Cash or Money Order. After that you should run them all & choose the best candidate. No sense in trying to pick a tenant without all the information that is available to you. Tenants should be aware that this is just the cost of doing business.
Investor Ā· Post Falls, ID Ā· Member since 2016 Ā· 606 posts Ā· 699 votes
8y
We only do group showings when we have a vacancy. Bring a friend or partner who knows not to say anything that violates Fair Housing. You only answer questions about the property, do not have the friend ask any questions about family size or where the potential applicants are from. Have your requirements printed out and visible, so that applicants can self screen themselves out, rather than waste an application fee. Use actual $ numbers -- say "to rent this apartment you must have a monthly income of $X,XXX and total move-in money is $X,XXX" rather than "you must have an income of 3 times the rent". Do not expect applicants to do math. Charge an app fee high enough to discourage the unqualified from applying, but accept applications from all. Let applicants know that you WILL run credit/criminal/eviction checks -- you are not just collecting app fees to line your pocket.
Bring a computer printer/copier to the showing. Ask applicants to bring a copy of their government issued photo ID and a paycheck stub to the showing, if they are interested you can copy right then. We collect app fees at the showing, run applications and refund the app fees to those who qualified if we rented to another. We have a standard feel good letter we send to qualified applicants who just did not get the apartment due to only having one vacancy.
In my experience, the people who have to "think about it" are the ones who realize they will not qualify and say that to save face. You will never hear from them again. The applicants who know they qualify and want to rent the property, will be very eager to get their app fees and applications in.
Funny you should say that. Plans are in place for a Holton-Wise office to open in the Clearwater area in 2019. I need more sun in my life. These Cleveland winters get old after awhile.
Funny you should say that. Plans are in place for a Holton-Wise office to open in the Clearwater area in 2019. I need more sun in my life. These Cleveland winters get old after awhile.
Yes James I had seen that. STAY OUT OF FL. It is too hot.
Funny you should say that. Plans are in place for a Holton-Wise office to open in the Clearwater area in 2019. I need more sun in my life. These Cleveland winters get old after awhile.
Yes James I had seen that. STAY OUT OF FL. It is too hot.
Rental Property Investor Ā· Cranston, RI Ā· Member since 2017 Ā· 171 posts Ā· 158 votes
8y
Thanks, @Bettina F., the group showing went well, as even if only 8 out of the 30 inquiries showed up, at least it wasn't a waste of our time. I'll probably take this approach for our vacant units again. I learned some things the hard way (i.e. you are right that I had to do the math for them), and I agree with you that most of the ones who left with applications will probably not send them back for the reason you noted. Thanks for your feedback...very helpful!
Rental Property Investor Ā· Prairie Village, KS Ā· Member since 2015 Ā· 2k+ posts Ā· 2k+ votes
8y
I do a prelim screening using tenant cloud, no fee. It gets their contact info, email, and asks a few questions:
Is your credit score over 600?
Are you willing and able to pay rent online (free)?
Do you make 2.5x the monthly rent?
Do you have any evictions?
They are self reporting, but they now know what Iām looking for.
Once they do this, I send them an email from Smartmove and they pay for their own background check. Some people have trouble with tenantcloud because the platform isnāt that great (lots of glitches).
Iām not sure itās the most efficient way to do it and Iām thinking of switching to cozy for the application and the background check.
I donāt take anything but online payments through ACH transfers. Tenantcloud has this setup through a payment processor called Dwell. Itās free but I pay tenantcloud $9/mo. I think Cozy actually does the same thing BUT they donāt do online leases. I really like online lease signing-so much easier! If others have suggestions for platforms Iām open. I donāt have enough units for buildium or app folio.
I do first qualified candidate to complete the background check for all adults in the unit. When I filled up my units in Nov/Dec I had 5 that I needed to fill, so I didnāt have the problem of a ton of applicants. I did have several who wanted it, but had evictions in their background check.
I have my first showing tomorrow for a vacant apartment, and it's a group showing. My question is with regards to application fees. If I get a bunch of people who apply (fingers crossed!), I assume some might get eliminated just from the basics on the form (i.e. lack of employment, landlord references, etc), but for all those who pass the initial qualifications, do you process background checks on all of them and then select the best candidate? Or do people process a couple at a time until you have a qualified candidate and then mail back the fee to those who didn't get processed? I feel bad taking $35 from each person when there is only one vacant unit to fill, but mailing back checks seems like a hassle as well. I'd appreciate feedback from those with some experience in this area!
I do a initial screening or qualifications. Usually over the phone. I used to do the meet and greet. After wasting time driving around to meet with people that couldnāt qualify and I could of declined over the phone. I now do a initial questionnaire by phone. Can you pass this that or the other. No? There is no point going on as you wont qualify. And Iām not wasting hours to meet with you just so I can say no thank you in the end
All applicants over 18 are processed. If itās a group I need ALL the applications filled out by all the applicants in that group over 18. If a few separate groups are applying I simply call and tell the ones I have not processed and I can write void and shred the check. If they want it mailed I can mail it back to one applicant if they provide a address. Most choose to shred. Groups ar3ctreated as one person.
But
What I do now is use TransUnion smart move. I donāt even take any checks. I simply send a invitation for tenant to fill out and pay for the background online. I get the results emailed to my TransUnion account. This way I have absolutely NO money to deposit, nobody accuses me of stealing their money and I leave the whole process up to the applicant.
I havenāt processed a application payment in years. I tried Cozy and didnāt care for it. Went back to TransUnion.
Thanks, @Bettina F., the group showing went well, as even if only 8 out of the 30 inquiries showed up, at least it wasn't a waste of our time. I'll probably take this approach for our vacant units again. I learned some things the hard way (i.e. you are right that I had to do the math for them), and I agree with you that most of the ones who left with applications will probably not send them back for the reason you noted. Thanks for your feedback...very helpful!
We always get a high proportion of no-shows, too. That was the impetus for the group showings. Nothing is worse than wasting time at the rental, waiting for a no-show.
Rental Property Investor Ā· Cranston, RI Ā· Member since 2017 Ā· 171 posts Ā· 158 votes
8y
@Rob D., I hadn't settled on a company yet for the background checks, but Smart Move sounds great and probably what I'll try. Thanks for your offering your feedback on that, as I'd rather not handle the fee at all. I'm curious though....do you find that you get a lot applications from people who aren't qualified? Meaning that they fill them out even though they know they may know they don't qualify? I ask, because when I discussed the fee with them in person, I could see their facial expression and get a sense of whether or not there was a concern. Or maybe that should just be part of my initial questionnaire when I pre-screen on the phone. Always learning :)
Rental Property Investor Ā· Cranston, RI Ā· Member since 2017 Ā· 171 posts Ā· 158 votes
8y
@Tami R., I ask some of the same questions that @Lee Ripma posted in this thread and find it pretty helpful over the phone. Their first questions is usually "When can I see the apartment?" and I have to steer that conversation towards my questions. Pretty often, I can hear the change in the tone of their voice based on one of the questions I might ask. We still got some duds that showed up, but as someone else noted...you just need one good applicant!
@Rob D., I hadn't settled on a company yet for the background checks, but Smart Move sounds great and probably what I'll try. Thanks for your offering your feedback on that, as I'd rather not handle the fee at all. I'm curious though....do you find that you get a lot applications from people who aren't qualified? Meaning that they fill them out even though they know they may know they don't qualify? I ask, because when I discussed the fee with them in person, I could see their facial expression and get a sense of whether or not there was a concern. Or maybe that should just be part of my initial questionnaire when I pre-screen on the phone. Always learning :)
I used to get a lot of unqualified applicants but that was partly my fault as I simply didnāt ask. I would meet and when we got to the meat and potatoes after the initial meet and greet it was apparent that people were struggling. When I ask a question and the response is āsee hereās the thingā I know Iām in for a convoluted story that will make no sense, I have no interest in hearing it and will be guaranteed to end with thatās why I have bad credit or need to make payments on the deposit or whatever excuse or reason th applicant has. I had people take applications but I never hear back from them. Which is fine with me. I donāt want to waste my or anyoneās time or their money just to say no. I donāt need to spend all that time processing people just to say I did something. Itās a simple Iām sorry but at this time you donāt meet our criteria.
If a applicant makes a face when you ask for a 40 dollar processing fee you probably donāt want that tenant. I had a few who wanted to submit their own credit and background checks. Yeah donāt do that. You pull your own records