Rental Property Investor · Northern, CA · Member since 2012 · 5k+ posts · 5k+ votes
6y
@Lindsey Vargas I have the applicants submit a month’s worth of their most recent paycheck stubs along with their application to me. I do this for several reasons.
First, I (like most landlords) require the applicants to make a certain amount of income to even pass screening (3X the monthly rent). What would be the point in having that as a screening criteria if I wasn’t going to verify it?
Second, I need to confirm they’re still making this amount of money now (not last year or a couple months ago). This is especially important right now with COVID and all the various local, state and federal eviction moratoriums going on. So I want to see that they’re still getting paid this money, and the actual break down on the check stub of how much they get paid per hour, how much of it was overtime, whether they regularly earn overtime, any garnishments or involuntary deductions, year-to-date pay, etc. Point is, there’s so much you can learn from their paystub.
Lastly, I just want to verify they earn what they say they do on their application. On my application I ask how much they make per month, and some (many) people only know how much they make per hour and have a hard time converting it to monthly income so they just guess. And coincidentally, sometimes they just guess whatever 3x the rent is to make sure they qualify (probably hoping I won’t verify it). But I’m going to. You have to make sure they can afford to pay the rent. If you don’t, you’re not doing either one of you a favor.
I have 3 applicants I would be happy to choose from and so far just have their application with background/credit check and employment, etc.
Do I accept one applicant and then ask for proof of income, or do I ask all 3 for proof of income and then choose?
I don't. I ask them to fill out an app on cozy.co. it then runs everything for me and I know where they worked, credit score, and eviction report with background check. It is all online. No paper and easy. Have they completed an app yet? Hope this helps!
Real Estate Broker · Hyde Park Tampa, FL · Member since 2019 · 2k+ posts · 3k+ votes
6y
A credit score will tell you a lot - and what you want to know is whether or not the applicant has consistently met his/her obligations. What I recommend is verifying employment (call the employer and look for only a yes/no confirmation which legally is all they can provide) and then calling the last landlord (did they pay you on time; maintain the property well).
Skip collecting pay stubs and bank statements; those remain requirements for securing mortgage financing but employment and past landlord are more meaningful for tenant selection.
Rental Property Investor · Northern, CA · Member since 2012 · 5k+ posts · 5k+ votes
6y
@Lindsey Vargas I have the applicants submit a month’s worth of their most recent paycheck stubs along with their application to me. I do this for several reasons.
First, I (like most landlords) require the applicants to make a certain amount of income to even pass screening (3X the monthly rent). What would be the point in having that as a screening criteria if I wasn’t going to verify it?
Second, I need to confirm they’re still making this amount of money now (not last year or a couple months ago). This is especially important right now with COVID and all the various local, state and federal eviction moratoriums going on. So I want to see that they’re still getting paid this money, and the actual break down on the check stub of how much they get paid per hour, how much of it was overtime, whether they regularly earn overtime, any garnishments or involuntary deductions, year-to-date pay, etc. Point is, there’s so much you can learn from their paystub.
Lastly, I just want to verify they earn what they say they do on their application. On my application I ask how much they make per month, and some (many) people only know how much they make per hour and have a hard time converting it to monthly income so they just guess. And coincidentally, sometimes they just guess whatever 3x the rent is to make sure they qualify (probably hoping I won’t verify it). But I’m going to. You have to make sure they can afford to pay the rent. If you don’t, you’re not doing either one of you a favor.
Rental Property Investor · Cincinnati, OH · Member since 2020 · 870 posts · 823 votes
6y
@Lindsey Vargas I always start with a basic application that includes a request for income documents. My application let's the applicant upload documents as part of the form. If they meet my income threshold, that's when I screen them through the same form. I use Innago instead of Cozy for mine (as you might expect...).
Like Cozy, it charges the applicant for the screening, and I hate to charge them if I'm going to reject them based on something obvious like income proof.
I usually use screening as the final step in the process to verify what I've already evaluated the applicant for.
Real Estate Investor · Tempe, AZ · Member since 2012 · 874 posts · 648 votes
6y
@Lindsey Vargas I ask for them when I've narrowed the field. I do background checks one at a time, and it includes their submitting pay stubs. A well-qualified applicant should have no problem submitting these, and a well-organized applicant should have no problem procuring them (even if they don't log in and look at them every single pay period). I am increasingly running into large employers outsourcing their employment verification, which is adding to cost-creep. I don't like to have (and thus need to safe-guard) any more personal information than absolutely necessary, so my application says pay stubs will be needed, but I do not require them to be submitted with the application.
Property Manager · Cleveland, OH · Member since 2019 · 446 posts · 566 votes
6y
Our process is to require a complete application from the start. We won't even run the background check until someone has the full app, including proof of income and residential history with contact information.