tenant screening: unqualified tenant?

Question

Hey guys,
our 2br house has been on the market for 45 days, and after we lowered the price to 695$ we received an application. I am concerned about these prospective tenants, since in their history there is:
-bankruptcy
-walked away from a lease when they went bankrupt
-they have NOT paid their April rent yet, and today is April 9th!
-he is a security guard, she is a lab tech. employment history to be confirmed.

My biggest concern is NOT paying the April rent...
I am inclining towards declining them.
What do you think?

James H. · Answer

DENIED I'd rather pay another mortgage payment or two than place someone who will get evicted in two to three months. If I recall, your rental is in Vegas? Have you considered renting section 8? There are pros and cons, but from previous posts of yours, including this one, your tenant pool quality probably wouldn't be much different. Do a search for posts by "Mike Oh" on here, he has a screening model that works well IMO. Another thing that I add is to never help someone break a lease they are in. No doubt these folks will move into your rental and never pay that April rent to the previous LL. Not only is it bad voodoo for you against another LL, it will surely happen to you by these same folks. One thing to be careful of when screening is that a lot of folks won't qualify for apartments because apartments actually do a credit check. Professional tenants look to find LLs of single family homes because a lot of independent LLs don't do due diligence on applicants - then they get burned and the professional tenant moves on to the next unsuspecting independent LL. If you have a good clean unit set at below market rates, you CAN find a good tenant. Just be patient and thorough. Too bad you can't actually meet with the tenants yourself...That's how you screen the bad ones out that have good looking applications...

Joel Owens · Answer

Section 8 can be a nightmare as well as a dream.Make sure the voucher is enough to cover your rent payment. If it's under by a bunch (couple hundred) the tenants try to not pay or drag it out.They try to leverage themselves into a better unit with higher rent than there voucher will allow but they cannot afford to make up the difference. Could you get more having the property be a vacation rental?? 695 a month is 23 bucks a day.Could you get more than that as a rental?? The downside is if you are far from the strip they would have to rent a car or pay for a taxi rather than walk to the strip and back to the hotel. If you aren't getting rental bites it's either under marketed or the rent is to high or they don't like the lay out or area etc. Have you gotten a bunch of showings but no offers to lease??That would point to area,layout,finishes. If you have calls but no showings rent might be too high.Just like strong credit buyers want a deal on a house when purchasing so do good tenants. If I was a great tenant I wouldn't pay close to market rent unless the place was amazing in a great area to justify the price.

Ryan Mullin · Answer

It's pretty common for tenants to try to skip out on their last months rent.. They justify it in their heads like this: "Well.. my landlord is gonna keep my deposit anyways.." Tons of tenants will burn that bridge and not think twice. My company never moves a tenant in unless they have come current with their previous landlord. Its common courtesy.

Edita D. · Answer

Ryan Mullin They are a month to month lease now, so I am assuming been there for at least a year. It just seems weird to me that they did not pay April rent. He's a security guard, she's a lab tech. How hard is it to some up with 350$ each??? And yes, I agree with everybody that it's better to wait out and get a qualified tenant. There are some red flags I do not want to deal with, we are not desperate. Brian Hoyt Section 8 is a good thing to consider, thanks for the suggestion. We will look into it.

Edita D. · Answer

thank you for your insights, guys!!!

Andy Chu · Answer

You already answered your own question.

Ryan Mullin · Answer

How long have they been at there current residence? If less than a year I would deny them. Do they have at least 1 year of good rental history since the BK? It sounds like you have a bad feeling about them.. Don't rent to them.. Lower the price a little bit more and puts some ads on postlets.com..

Joel Owens · Answer

Bankrupty what kind?? 7 or 13 ?? Were all debts discharged in a 7 ?? Was the 13 plan discharged from finishing or dismissed?? A bankruptcy can actually be a good thing.Some tenants that are carrying a huge debt load have a hard time paying the rent.Those that blew everything out can start fresh and can pay things easier. If it was a chapter 13 that was dismissed for non-payment then those debts are still there and have grown larger. I would look at the credit reports for both parties and look at debt load,BK structure and if finished,judgements,tax liens,etc. Go back 2 landlords at least as the first might give a glowing recommendation to get rid of them. You can mitigate a weaker qualifying tenant with non-refundable upfront money and larger security deposits. If they don't want to do that send them on their way.