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Updated almost 4 years ago on . Most recent reply

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Lauren Hulsman
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Can you ask for financial obligations on application?

Lauren Hulsman
Posted

My husband and I are renting our townhouse for the first time and are really struggling picking the right tenant - we've had a lot of interest. We have it narrowed down to 3-4 people, who all seem like great fits. One application did not list out their financial obligations, which we're using to determine their debt to income ratio. Can I press them to list that information? 

Also - 3 out of the 4 are non-married couples...do you guys find it higher risk of one person leaving in those situations during the lease, especially if the couple has not lived together before?

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Nathan Gesner
  • Real Estate Broker
  • Cody, WY
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Nathan Gesner
  • Real Estate Broker
  • Cody, WY
ModeratorReplied
Originally posted by @Lauren Hulsman:

@Account Closed fair enough. Like I said, this is our first time and I’m researching as much as possible to ensure we have the right tenant and making sure we have the most financially secure tenant as this has been my personal home for 7 years, not some random apartment building I own. I’ve also been reading that debt to income ratio is less important as long as they satisfy the 3x rent income, so we are opting to not stress the financial obligations. 

Eric is completely wrong. He's a renter, not a Landlord.

The applicant's debts are absolutely pertinent! I had a tenant that applied for a $700 apartment. His income was $2,500 which was more than 3x the monthly rent. However, he had a truck that was costing him $700 a month in payments and insurance! It was a gas guzzler so you could easily add another $200+ to his monthly expenses. Credit cards and student debt rounded it out. After considering his existing debt, his rent to income ratio was closer to 50%.

It doesn't matter how much you make; it matters how much you have available to spend.

  • Nathan Gesner
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