Would you approve this couple?

Question

I had a very nice couple apply on a unit today. They both work at the same nationally branded company and have been there 5+ years. Combined income in the $125K range. Both freshly divorced and starting over. They submitted applications via MySmartMove a few hours ago.

She passed with a decent score. He got a score >500 but less than <550 and the system declined him. He is still on the mortgage with his ex-wife but she pays the mortgage.

He has debt issues to the tune of about $70K in auto and other revolving loans.

Comments;Recency of a balance overlimit on a bankcard accountNot enough available creditAverage balance of auto accounts is too highBankcard account balances are too high in proportion to credit limitsInquiries impacted the credit score

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I got great vibes from this couple, but I'm not sure what to do when the results are mixed on a report like this. I'm assuming that if one comes below the bar, the fact that she is above does not compensate, right?
Looking for advice on what to do.

Thanks

GT

Aaron Beauchamp · Answer

@Garen T. I would suggest approving with 2 months security deposit on the couple. I did property management for years and I have seen this before if they can do the 2 months thats great, and if they can't then you have reason to say no.

Troy Ramey · Answer

I'd stick to the minimum requirements you've set for renters every time. It reduces the chance you'll be accused of discrimination and the minimum standards you created are there for a reason. Stand by them.

I recently rented to a young couple and the the woman had great credit and an amazing job, while the guy had almost no credit history and was in school full time without regular work. I was obviously concerned because one of them had almost no income and no credit, however I rented to them anyways as their references were excellent and they didn't lie or try and cover up the fact that the guy wasn't working. I'm about 3 months into the lease now and the house is in excellent condition and rent is paid on time, so I can't complain. It worked out (so far) very well, but I was really nervous the first month or two. I believe I just got lucky on this one and after I gave them the keys, I wished I had stuck to my guns.

Just my two cents...

Teresa M. · Answer

I absolutely would NOT approve them.  We are currently in the process of dealing with this type of scenario.  We rented to a very nice young couple 6 months ago.  The young lady make almost $100K annually herself. She had impeccable credit (FICO of 850).  His credit was 550 and he made about $50K annually.  About 4 months into the lease they started having relationship problems and she wanted out of the lease.  Due to verified domestic violence issues where she was the victim, we let her out of the lease.  He didn't want to move and decided to stay.  Now he is living there and unable to afford the rent. He barley paid rent last month.  As of today he hasn't paid rent for the current month.  We probably will have to start the eviction process very soon.  Had we stuck with your requirements we would not have approved them.  DON'T DO IT!!  We have learned a valuable, potentially expensive, lesson.

Anthony Wick · Answer

If he was the sole applicant, I would say no. But, recent divorce, and has run up his credit cards? Well, I had that happen to me. It appears as though their income is plenty. I would most likely rent to them.

Ned J. · Answer

What are your criteria?

How is their income compare to the rent? Sounds like they make decent $$ and have stable jobs.....that's a big PLUS

Previous rental history?

Credit it important but not my top priority.....depends on why the credit is lower than you would ideally have.....late payments, collections, huge balances...vs they have high debt but make all their payments...have some stuff lingering from recent divorce etc.

Ned J. · Answer

For me, these would be in the "maybe" pile...... not NO, but I'd be looking for someone better. The finances combined with what sounds like a newer "post divorce" relationship makes me uneasy.

Aaron Beauchamp · Answer

@Garen T. They will need to pay ALL the months even the first month and last. The 2 months deposit is just for insurance. I usually work with the tenet if they do not have the money on hand I give them the option of paying the deposit in a 3-4 month time frame, with equal part payment every month.

Garen T. · Answer

Hi everyone,

Thanks for all the great advice and opinions. I've decided not to rent to them.

1. The e-mails have been fast and furious about interest in the property. I don't think I'll have a problem.

2. As I started looking deeper into the credit cards balances he (and a few of hers) it looked like in general every card was maxed out and he was only paying the minimums. In addition, many of the credit cards were joint account listed. I don't think he's really extricated himself from his ex-wife. This could just be the start of complicated stuff for this pair.

3. I have the criteria for a reason, and I need to stick with the criteria. Thanks for the reminder!!

Michael Plante · Answer

I don’t know the laws in your state

If it is me I start eviction 3 days after rent is due.

Would you approve this couple?

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