Qualifying and Screening C and D Class Tenants

[Curtis Denlinger]

I have a new property in a maybe at best C class neighborhood. I’m having trouble qualifying tenants. I have a lot who work jobs as servers or bartenders and make cash tips. Or I just had someone tell me today their main job is under the table.  So almost everyone I talk to makes more money and pays for things in cash, but then I can’t verify their funds. 

When dealing with C or D class neighborhoods, do you get creative with how you screen and qualify tenants?  Maybe do you have to do more digging and reach out to their employers?  If they keep money in cash so you can’t verify with bank statements, what do you do?  OR do you screen the same and just have higher vacancy in these types of neighborhoods since barely anyone can verify their funds the normal way?

[Matthew Morrow]

Absolutely, in C or D class neighborhoods, it's often necessary to get creative with tenant screening. Verifying income through employers is a good strategy, and you might also consider requesting reference letters from previous landlords. Some landlords accept additional security deposits or pre-paid rent if traditional income verification is challenging. Remember, consistent documentation is key to protect yourself and your investment.

And @Nathan Gesner is spot on. Dont use it as a yes/no. This whole business is about mitigation of risk. This is one thing you can control, and want to be sure you are thorough .