All Forum Posts by: Tom Ott

That's amazing! I wish you the best of luck in the world of REI. Keep up the good work. It sounds like you really know your stuff. If you need anything else, please feel free to ask me!

Agreed. You'll find the applicants who do not want to pay are most often the tenants you don't want. If someone really wants to live there, they will pay what it costs.

 You would need to include your terms of late payments in your lease. If rent is not in by a certain date of each month you need to say you would move ahead with eviction. Depending on your state of course...

I cannot remember all of them, but I believe AppFolio might do two at a time. If not maybe I misspoke. Most do charge per-tenant. There will be push back don't get me wrong, but normally if you explain to them what it is what the program charges, they should understand.

Tell them you can't move forward without this payment regardless. 

Hello Andy,

Speaking from experience, it is mixed! This is a great question, and one that I hear about a lot. 

We only charge exactly how much it costs to run a report just like you said. It roughly comes to $40 dollars per application. Some systems allow you to run 2 or more at a time. It depends on the system.

Sometimes I get applicants who are upset that they are spending close to $50 for a place they might not even get! Others are fine with it because they know reports are not free.

I've even had some tenants refuse to apply because they didn't want to spend the money.

You will run into these problems along the way, but for the most part people are normally understandable. If they are confused calmly explain to them the system you use requires a fee to run a report and you are charging the minimum. Without the report you cannot determine if they qualify or not.

Most of the time they understand.

I hope this helped! Please let me know if you have any other questions!

Well that is just some advice in general. But I'd say best practice is to find a program that does both at the same time. Many of them out there will give you a credit report and a criminal history in the same search.

This way when you get the results, you can look over everything. Having both reports at the same time always works out best for me.

Hello Andrea,

The way you handle it is perfect! That is exactly how we do it. We add an extra payment (depending on location and number of tenants) to the rent and tell the tenants they owe it all in full every month. We almost never talk about the base rent amount. Of course that number is in the lease, but we always refer to the total (rent+water.)

We keep it in our name and the tenants pay us directly. We reconcile it depending on usage of course. If someone pays us just RENT and not water, we inform them they did not pay full rent and we won't accept it.

You have plenty of options out there. I think the way you do it already sounds great. Keep it up!

 Hello Andy,

Great question! With so many options out there it seems many people are unsure what system to go with to screen tenants. I've heard all good things from these programs.

You want to make sure you find a program that does both a credit report, and a background check. Some programs will give you credit history and criminal history in the same report. I must say that is always very helpful.

Things I like to keep in mind when screening tenants are:

Have them sign an authorization form, which allows you to look up their credit report and do a background check. Never simply look at a credit SCORE, but make sure you look at the whole REPORT. Someone could have a good score, but owe a lot of money on collections. (I know, but it happens)

Analyze their credit report and if you feel comfortable, do a background check and make sure their criminal history checks out.

Another key factor is employment history. Make sure they have a job of course! You also want to make sure they have had the job for more than a few days. Remember their ability to keep their job (or have a steady income) will directly effect their ability to pay the rent.

We always have them submit pay-stubs. 2 - 3 most recently ones give us the information we need. You want to use that information to check to make sure they have enough money to pay their bills, including the rent. We don't normally ask for a license until they are signing documents, but that might be different depending on your state.

Please let me know if you have any questions!

 15%? That sounds pretty good to me! Well if your gut has been working, keep it up!

 Nuhan is correct! You should always check property records to make sure it's not a friend.  I've caught a few trying to act as LLs before.