All Forum Posts by: Tricia O'Brien

 Hello Fellow BP Folks! 

I have an unusual applicant that I am considering, and I would like the input of other investors / landlords.  This is for a 3 bedroom single family rental home ... C home in a D neighborhood in Indiana.

He has an old domestic violence conviction (2012). He has a current domestic violence case (felony domestic battery) that is pending, and it has been working its way through the court system since Nov 2021.   I don't believe he was taken to jail on this current case.  These have been a few court dates since Nov 2021, and he has attended these with a public defender.

I want to know if folks have rented to applicants like this, and did you have any problems...such as acts of violence against any realtor/PM or handymen that you sent out to the property? Any other problems?

The reason I have given his application a second look is that he has relatively high income (5.5x the rent), a skilled blue-collar job (machinist), and he said he is willing to pay a double security deposit due to his credit score being less than 600 if he were approved.  He has been at his current job for 3.5 months. 

The house has been advertised on Zillow now for about 20 days. The minimum qualifications listed are:  Income 3.5x the rent; credit score at least 600; no evictions. 

I've gotten about 9-10 applications.  Some are incomplete.   Only 2 of the applications meet the credit score requirements, and both of these families don't want to move until around Dec 1.  

I'm an out of state landlord and have a realtor that does tasks for me on an "a la carte" basis and I use local handymen.

I have not approved or declined his application yet...   I've not yet called his landlord references or employer references yet.  I am in the middle of processing it.  

But I'm a little freaked out by his criminal record.  

What would you do?  

Would you give him a denial based on his credit score of 526 (Experian) 

Or would you continue to process his application? 

He wants to rent the house with his current girlfriend.  I don't yet have an application yet on her, but he says she could do an application as well.  

Thanks in advance for your input!  

@Ian L.

Yes I got the vacancy coverage.  Is the vacancy endorsement $45 per month flat rate with State Farm? One weird thing about the vacancy coverage is it excludes some things... like if your kitchen appliances and window air conditioning units are stolen during the vacancy it does not cover those. Is that true with most vacancy coverage policies

@Richard F.

Great chart! So can you tell me if I'm interpreting this correctly?  In the credit score range of 640-659, 1 in 24.1 people ( so about 4%) will go past due or stop paying on a bill that is tracked by Equifax or TransUnion (like credit card, car payment, student loan, etc) in the next 24 months. But with the credit score 580-599, 1 in 9.3 people ( so about 11% ) will go delinquent and go past due or stop paying on a bill tracked by the credit reporting agency.   Right? Thanks in advance! 

How do you know if the contractors are ripping you off?  If the management team never goes to the properties in person, how do you know if the contractors are ripping you off or stealing materials or doing poor quality work when it is vacant?   

@Matthew Morrow

What do you mean by "Local contractors connected to the MX"? Who do you use for local people to manage / supervise the local contractors if they are working on a vacant property? Thanks in advance! 

Hello Everyone!  Do you spend the extra money to buy a  "vacant policy " on your rentals if it is vacant more than 30 days between tenants? Have you ever had a fire claim or theft claim or other insurance claim on your rental home when it was vacant?  I have a rental single-family home in Indiana where the insurance is only active for 30 days after it becomes vacant.  Then I am supposed to notify my insurance agent that it is vacant, and they switch it to a "vacant home" policy at a higher rate. This is to cover you if it is going to be vacant for 2-3 months or longer in between tenants.  The rate on the dwelling part of the policy goes up 23% during the vacant period compared to what it was when occupied.  Is it worth it?  

It is a C home in a D neighborhood.  I have all the exterior lights on, one interior light on, and someone available to mow the lawn every 2 weeks. I'm trying to have a realtor or handyman go there at least once a week to do work or check up on the place.  

Thanks in advance! 

You should verify occupancy before you start eviction. If you don't know any realtors or handymen or others in the area, you could hire a legal services company to do an "occupancy check" for you. This should cost about $100 or less. They will send someone out there to knock on the door, take photos of the exterior, listen to see if there is a TV on, look to see if there are any lights on, see if there are any cars parked there.  Have them send you the photos they take!  If it looks occupied, you should have someone post a 10 day notice to vacate (or whatever notice is appropriate in your state) based on non-payment of rent.  If they don't pay up within the allotted time frame, then you should start the eviction process.

Hello BP folks!  I am looking for an alternative to Avail for lease signing and monthly rent collection for my 2 rental properties, and this company seems like it might be a winner. Has anyone used them?  Were they reliable in getting the rent payments processed from the tenant's checking / savings account to the landlord's account? Was the lease signing process smooth?  They say landlords can use Docusign if they want, but they also partner with "Hello sign" for lease signing which apparently is similar to DocuSign. Thanks in advance ! 

The property manager absolutely could do this, but they don't want to because it would increase the work for them.  The bigger the property management company is, the less willing they will be to customize their processes to what you want / need as an investor.  They usually are only concerned about their short term gains and not your long term needs as an investor.  Some property managers don't even use credit score as one of their screening criteria!  You could self-manage or try the other local company and see if they will do what you want re: screening criteria.

@Kevin Sobilo

That's a great formula to use ...I like your calculator of rent plus monthly debt payments being no more than 45% or gross income.  I've always struggled with how to figure out how to estimate if people could afford the rent along with credit card and car loan payments, etc.  What class of rental properties do you apply that to...class A, B , C and D?