Declining tenants is a necessary part of being a landlord.
A tenant recently inquired for one of my rentals. I always do on-line advertising so most of the inquiries are via email. If they call directly, I get their email address texted to me, so I can email them my standard response. As I have posted before, I typically send out a canned response so that prospects can understand what I am looking for in a tenant, and they can also get a better understanding of the layout of the apartment(s).
A link to a video tour is also included, which I have received a lot of unsolicited compliments on. I just walk around the apartment narrating the video. Nothing fancy, no high tech camera. But it works.
Here is how one applicant inquiry went, from a tenant I declined.
In this case, the tenant called me first. She explained that her husband had a stroke, and had been out of work. He was only 29. It was sort of a sob story, but you must maintain solid, consistent criteria to protect yourself from risk, and fair housing issues. Her rent was going to be paid by a rental subsidy program for the next two years. She also asked if I would accept that kind of subsidy payment.
She said the social worker would call me. Keep in mind, I had not yet even offered her the apartment or agreed to anything. I had her text me her email address and I responded via email.
The Initial Response
My typical response is a lot longer than this, this is an excerpt, but it lays out the minimum quality of tenant I am looking for. Keep in mind, the average tenant score nationwide is about 658. This mirrors the average credit score in the complex that I screen for. Minnesota also has one of the highest average credit scores in the nation, so we should have a higher tenant average.
I will be looking for tenants with a 625+ credit score, and a solid household income of at least ~$45,000 per year. If you are marginal on both of these items, I will generally decline you. Your criminal and rental history must be clean. If you have had a foreclosure, I can work with you a bit on this.
If you have had an eviction, or you have had recent criminal activity including DUIs, I generally will pass on you.
After the prospect received this, she replied
“I am still very interested in the property. “
I already had a showing that day for the property, and I cannot verify credit other than a verbal confirmation from the tenant without a signed application. If they say they are OK, I am OK (for now…). The showing would be short notice, but since I had the time slot with the tenant already setup, I offered it to her.
So I replied, via email the following. “I can show it today, ~12:45. Does that work?”
She replied to that email after the showing time this response.
“Hello, sorry I missed your email. Can we reschedule? Or another day? “
Initial Verification
I did a quick lookup of her records on MNCIS, the Minnesota Court System search, and decided I should pass. I did not return the email. I received this email after another day.
“Are we able to schedule a showing this week or weekend? Also my worker with supportive housing unit will be giving you a call today to talk about the unit.
Judging from the pictures, the condo is beautiful so I’m very excited about it. I know you might be reluctant about accepting a subsidy, but it is only temporary and we are hardworking people.”
I replied to her, “What are your credit scores like?”
Tenant Goes Downhill
We are both in the 570’s range .. With our subsidy we get we will be working on our credit.. It’s all from when I was young and 18. Also I have school loans that qualify to come off my credit.. That’s why mine went lower.. My recent credit activity is good I’ve been paying on my car note consistently.
I really do not care where your money is coming from, as long as you will behave in the rentals. Credit score is a great indication of how you will behave. She said her and her husband’s credit score(s) were around 570. That is far too low for me, and would not even be approved for our association criteria.
The Decline
I replied, “570 is pretty low, I am not interested”
She then responded, “Ok thank you “.
I next received a call from the social worker. The worker said they have been having a difficult time, and had low credit. They also have some evictions. And who knows how many times that they have been asked to leave. The score the social worker was shown on the credit reports that she had were in the 520s range. That is way too low. Only about 5% of the population has scores that low. There is definitely a high probability of behavioral issues when you get to that level.
Again, another last chance effort from the tenant.
Persistence Does’t Always Pay Off
“Good afternoon, I am sorry to bother you again, but our credit score is not from being irresponsible. My husband had a really good job making 1,000 dollars a week we were working with a credit solutions worker to build our credit and dispute matters on our credit that shouldn’t be there. Then my husband had a stroke. We need a chance, and I am embarrassed to pour my heart out to a perfect stranger but The bible says that close mouths don’t get fed. If you still are not willing I understand and thank you for your time. I am just asking a second chance for my family’s sake. “
I did not respond any further.
The rejected tenant was 28 years old, her husband was age 29. I looked for public information to see just how much she might have been hiding, or perhaps not volunteering information. Here is what I found.
Rental History (both names that wanted to apply were on all evictions)
01/2015 – Eviction
06/2013 – Eviction
05/2011 – Judgment by Credit Company ($6,332.70)
11/2007 – Eviction
Criminal Record (Hers)
07/2006 – Expired registration
03/2008 – Traffic Regulation – Driver Must Carry Proof of Insurance when Operating Vehicle
12/2003 – ORD-TRAF-NO PARKING 2AM TO 6AM (9-1-3K)
Criminal Record (His)
09/2004 – DRUG PARAPH MV DRIVER (Dismissed), No Insurance Own/Operate (Guilty), Instruction Permit Violation (Dismissed)
10/2004 – Consumption by Minor (Guilty)
03/2005 – POSS DRUG PARAPHERNALIA (guilty)
01/2008 – Driver’s License-Driving After Suspension (Guilty), Traffic Accidents – Driver Involved Fails to Stop for Accident to Property (guilty)
11/2010 – Traffic-Driver’s License-Driving after Revocation (Guilty)
10/2011 – DL-DRIVE AFTER REVOCATION (DAR) (Guilty)
I read into these reports that they likely do not have insurance now, after all, they have nothing to lose. If they do not abide by the law, will they abide by my lease? If I threaten to evict them, will they be afraid of an eviction on their record? Will they be worried about a judgment from me that will hurt their credit score?
Often, the cause of a person’s problems can be found when they look into the mirror.
WOW, another bullet dodged. It was an easy decline, and easy to find this information. Some landlord will rent to them, and eventually get burned.
Are you prepared to move to the next tenant, even if rent is guaranteed? Are you prepared to take a risk risk tenant, just for the money? Would you have taken this tenant?
We had a persistent tenant like that on our last round. We kept telling her no very nicely, but she kept calling back. Finally, we had to do a big firm NO! Because of this blog, we knew not to accept her. Thank-you for all the good information.
Thank you for the comment and compliment!
I am glad I could help.
Wow, and I will say in the past it wasn’t an issue, you can read people I too will do things different As we see tenants complain about every little thing, why can’t we as landlords identify them and avoid them . Can you give some information in an up coming blog on how to run credit and if a landlord isn’t that far, how to run a basic name check, Is it easy to get public information without even getting a social security number ? I have had people beg their way in and it was 3 in 2013 and I was sick and facing a horrible 5 surgeries in 2014 so I was so easy letting people in and all 3 where bad in in high high rental homes, high rent, over 2k a month. I was able to tell 2 to ” get the hell out before I evict “, I was sick I wasn’t into being nice with my words I kind of laugh looking back, BUT when one moved out I had a neighbor come over while I was cleaning up and told me cops where out almost weekly. I NEVER KNEW because it was one unit I owned in the complex
Long story short I sold all 3 homes for a profit and said no more, matter of fact, at one point I hates single family homes until some dropped 80 percent and I couldn’t resist buying. This way water and trash are on the tenant. BUT now I’m back into the multi unit Keep in mind I”m in southern California and we now have water issues, so not so sure how this will play out. I did put an offer in on a 4 plex for 260k in the high desert, nice, with attached garages, the numbers where good. I always look to see if I can go to individual meters in the future.
Let me say again, they aren’t making people like they use too. I’ve done this rental game for 15 years YES, and I’ve let lots slide and only evicted 2 EVER but since 2012, near the end people really have declined. So many stories, and like you said begging. There was a day I didn’t have to ask how many people in a 4 bedroom, ok 6 people, a family. BUT why think any further until I had 13 people move in. SO REMEMBER FOLKS today is different, we have doubled up households in some areas. I will now ask how many like I have BUT ALSO if an additional person moves in rent goes up. Again people will then lie or hide things
So again, not bad 5 bad tenants in 15 years, but some didn’t make it to eviction I just made life hell and said leave or ruin your credit. . Even the last 2 that moved out left the houses a mess, this was not the case before 2012. People aren’t as good as they use to be. Society is changing. I need to change with it SO THANK YOU so much for your blog. AND again how to search people with just names to get a glimpse into their back ground would be great Also who do you use for a complete credit and criminal back ground check ????? THANK YOU ! ! ! ! !
It does seem people’s attitudes have changed. The entitlement mentality is pervasive, and when you get a renter that feels that they are ‘owed’ something, that are the worse.
Here is a post that probably has quite a bit about what you are looking for. Let me know what you think.
I’ve always taken same precautions with my properties. Only accept people with good credit score, no past evictions and no court history for debt and crimes. Works as a charm. There are problems here and there, but then I have rent guarantee to cover, just in case.
My woories now are illegal sub lettings, as there is not past record to show that someone will do it or not. And this is becoming very frequently… :/
Thank you for the comment!
Illegal sublettings, or even just extra ‘guests’ have caused me problems in the past. Even one (or two) of my horror stories have been the subject of that nature. Here is another one.
Who do you use for background check and credit check? How much do you pay? I turned away several tenants, they seem to have the same strategy, want to move in very quickly, demand discount, and having a chiquauupqua, or a yorkie. It’s a weird things that people with low credit score, and a a felony are also dog owner? Anyhow, one guy said he has a criminal record for driving several time with suspected license. The last tenants that moved out before I bought my investment property also took the fridge, washer and dryer with them. 🙂 uhhhhh I do need clean tenants to protect my investment.
I use a company at http://www.mccgrp.com. I pay $39 for a credit check, past landlord check, employment verification and county level criminal check. A 625+ credit score would have eliminated the issues you have had. Also, I am sure the tenants had poor rental history and probably a criminal record too.
A robust background check is the cheapest and bet investment you can make. And the tenants pay for it!
I was wondering, are there any sites for post-tenant check ups?
I would just use the same company that did the first one. I would use your own experience with the tenant rather than a new check.
I needed that ! Thank you. I wanna say, you know what, It’s fair game, if the tenants of today wanna nit pick us, we sure the hell have a right to nit pick them. And even if they didn’t. Who”s in charge here ! ! We are, if they where, they’d own homes, I know I can be extreme, but I swear people have and will get away with what you let them and it’s down right amazing how people act.
I learned the most about people becoming a landlord, Seen every trick as you have. I will be like them, watch closely and I will go vacant a few months before I put up with a nightmare, because they play dirty these days and eviction is a headache, not to mention , WHO know about them being angry.
Again, people are different and I don’t want someone desperate, I’ve done my good deed for 15 years letting the under dog in, I’ve paid my dues, now it’s good people or NOTHING, thanks for sharing, I will use that company you recommend.
I too have learned a lot. When I first started, I assumed that everyone was a decent person, and all they wanted or needed was a place to live. And I thought they were appreciative of the fact you let them live there. Once you get a few bad tenants, you come to realize that there are many people that think you are a muilt-millionaire landlord and owe them something. Like a million dollars gives you a jet-set life style.
I wanted to reiterate, I was a single mom on hud, I had good credit , only thing I was a broke mom but my part was 107 and I was a good tenant. MOST AREN”T, but the one gal with 6 kids I took because it was 2009 and a beach house vacant 6 months with a 1800 cost to me every month so I needed to fill it, her kids where ok, but over past 6 years, 3 have criminal records, and it’s bad, but it wasn’t as bad to begin with.
I know I have long term tenants because they can’t get in elsewhere, 2 others have paid off. For instance a spotty record of working construction. Sometimes he pays late and last fee.
I will run credit and it’s not to turn into some commando, I’m a landlord 15 years and NEVER have ran credit, went with my gut and good judge of character, but now everyones an actor and can talk their way out of anything. Forget hud , not interested in it anymore and apparently fewer are. I saw the recent list and there is actually nothing available and it covers over 300k population. WOW,,, so I guess a landlord who has a 400k home doesn’t want 2200 anymore, There’s better uses for a property that costs that much.
I’m rambling, but I gotta say I read this out loud to my fiancé and he’s been my repair guy 9 years and has seen it all with me. He said well how strict, I said no more criminal records and no evictions. I can be more selective, but to have no INFO is down right irresponsible on my behalf. The liability for bad people is huge also. The gal with 6 kids, she has a pit bull, I asked her in Aug to get rid of it, then in Jan she still had it, did not even listen to what I said. If that dog bites someone they come after me. This crap has got to stop.
I guess it starts now. You’ve been a wealth of help ! I completely appreciate your time and this site 🙂
I too came from a single parent household. My mother made sure her bills were paid. She worked at McDonald’s as well as being a RN. And later a donut shop. She co-signed on a co-workers car at McDonald’s, and the guy quit paying. Over $2,000 in 1970 she had to pay for that deadbeat. I would have let the car go into re-possession. But she instill the need to pay what you owe.
Unfortunately, people that think they are entitled to things will buy them, and then not pay. It shows up in a credit score. They can get away with the criminal records being clean, and the Courts and police giving them a break, but FICO will eventually catch them.
There are a lot of studies about people that own pitbulls. Not only are the dogs bad, but often the owners are too.
Dear Landlord
Congratulations on your recent and successful retirement.
I’ve been enjoying your posts since I read your comment on Financial Samurai. I was looking forward to reading more until I came across the comment above and your response to it.
I try not to embarrass people in public but I do want to tell you I was terribly upset with both.
When I was a renter, I was an excellent tenant. I always got my full deposit back; still consider my former landlords to be wonderful; and would be too embarrassed to even walk in my rental door if I was a day late with the rent.
Now, I own my own home and am the landlord of our family’s commercial property in California with two residential tenants.
Through it all, I have been a lifelong animal welfare advocate who has seen the demonization of various types of dogs including German Shepherds and Dobermans.
I’ve also seen the unspeakably vicious attacks people have done to puppies, kittens, dogs, cats and horses. More animals have been abused than any dog could possibly match.
Dogs are not “its” as your commenter claims. They are living creatures who are loving family members, therapy dogs, guide dogs and scored have served and died honorably alongside our troops in every modern war.
Pitbulls, like all dogs and people, come in all types. Most are wonderful, happy and loving family members. Others are simply untrained and some have been mishandled or abused. That isn’t their fault; it is the the fault of lazy or cruel humans.
It isn’t educated or helpful to claim that all pitbulls are bad. There are too many wonderful examples of pitbulls to refute that.
Many landlords might find an emotional hard-to-comprehend single mom on HUD, like your commenter above, to be unstable, keep marginal company, or be involved in unsavory activities. I might. Many landlords may have written her off if HUD didn’t ensure them a guaranteed rent.
There are ways to screen dog-owning tenants. Ask to see a dogs “resume” with certificates of graduation from Dog 1, 2 and 3 classes and a Good Canine Citizen certificate, former landlords, veterinarians, trainers, etc. If they have a puppy, ask how long it will be in a crate. Four hours at a time is all that is healthy for a puppy or a dog; anything other that is cruel. Let them know where they can walk the dog. Ask for a reasonable and refundable security deposit. Finally, like any household member you’d be renting to, ask to meet the pet. You might be very surprised at the great tenants you can get.
Smart people can and do rise above their prejudices.
Thank you for reading!
I agree pit bulls are not necessarily bad. However, many insurance companies do not allow them, including mine. The fact are that if you are going to be killed by a dog, it will most likely be a pit bull.
Here is a post that deals with dogs. As you can see, I am more than fair when it comes to dogs, and I recommend the same. I have rented to tenant with German Sheppard’s and Doberman’s as well.
There are numerous studies that show the risk of the aggressive breeds, and it doesn’t really matter how the dog is raised. It is in a dogs nature to do certain things. There are also studies that show people that engage in risky behaviors own Pit bulls.
When unqualified applicants try to use my faith to manipulate and guilt me into renting to them, I remember that by renting to them I would be denying good housing to somebody who has lived a responsible life.
Thank you for the comment!
It never pays to fall for some over-used phrase that some people use to justify why you should lower your standards. The tenants I have had the most trouble with are ones that attempt to use their faith to lower your guard.
And now a generalization against religion? I think I’m reading more disrepectful and prejudicial stereotyping than I expected to on a business-oriented site. I just can’t believe “the tenants you’ve have the most trouble with are the ones who use their faith to lower your guard”. That certainly hasn’t been my experience. The ones I’ve had the most trouble with are the ones who don’t pay their rent or try to break the rules.
Thank you for reading!
In my early days as a landlord, I have had people pretend they are part of some religious organization and because of that, they always pay their bills. I have had the most trouble with them. It wasn’t due to the religion, but they used it as a cover-up to their own bad rental records. Religion should never be a benefit, nor a curse, for a renter.
Now I use credit score. I do not care what religion someone is, they do not, and should not, get any special treatment. From anyone. I take anyone who passes the background checks, as long as their money is green.