Accepting an offer of higher rent?

[Sara Ratliff]

I recently listed a rental and got an offer from someone to pay $250 more per month than what we listed for. I want to be ethical and legal, and haven’t found anything that states otherwise, but wanted to check with all of you experts and get your thoughts.

I do believe we have listed it too low, but we have had trouble with this rental property, mostly due to our newbie mistakes, and thought we would severely limit our tenant pool if we went any higher (already in a small rural town). He has a criminal history (from 10 years ago) and says his credit is not good, but is trying to rebuild it to buy a house in a couple of years. (I have not run credit/background yet to confirm to what extent). He also would like to sign a 2 year lease. He tells me he is willing to pay this higher amount to save him money from what he is currently paying in rent, and also was aware of the interest the house was getting. He has fulfilled his previous lease and is currently month to month. The rental pool for tenants in this area is not great, so we have never had squeaky clean backgrounds/credit, but also have a lot of turnover and lease breaking- literally the past 4 out of 5 tenants due to the couple splitting up. We decided we were going to be stricter on criteria this time around to break this cycle of turnover, but are considering this offer. Would you give this guy a chance? Are there any repercussions for accepting him as the tenant simply for his offer of higher rent despite the red flags with background/credit? I’ll add, he is also willing to pay a larger deposit, and I will check references and with current landlord.

[Joe Splitrock]

@Sara Ratliff are you going to break the cycle or keep making the same mistake? 

You never pick your renter, then pick your criteria. Always have criteria and make sure the tenant matches. 

That $250 is intended to get you to look past criminal and credit problems. In my experience whatever a tenant discloses, it is always worse when you run the reports. Tenants look for mom and pop landlords who will not run background or credit reports. He is banking on you taking the money and looking the other way, which sounds like what you normally do and why you have had problems.

Someone who can't manage money will agree to pay any amount of money for a rental. It is your job to determine if they have capacity to pay (income) and are responsible to pay (credit payment history). 

Personally, I would tell the tenant, I don't need extra money. If you meet my criteria, you will be accepted. If he is high risk, charge an upfront risk mitigation fee. That way you get the money before he moves in.