Gross Income Policy
My grandfather just bought his first rental house and has put me in charge of being the landlord. Actually the house will be in both our names. He bought it as an investment for my wife and me. He has owned and managed small commercial rentals for over 30 years but this is his first stab at a residential rental. Since I didn’t really know where to begin I went out and bought the book Landlording by Leigh Robinson. This is a very informative book that has put me on the right path for this rental.
The monthly rent for this house is going to be between $1600 – 1700, still working on the figures. If I figure on at least three times the rent for gross income that would be between $4800 – 5100 a month. If I adopt one of the gross income policies they talk about in the book “requiring that every adult occupant have a gross income equal to three or four time the rent,” I don’t think I will ever rent this house out. I was wondering how others handle combining the income of potential tenants? If I choose to go this route should I have each tenant that is going to live in the house over the age of 18 fill out a rental application, whether married or not? I understand that what I do for an unmarried couple I must also do for a married couple and visa versa. Should/Can I add anything to the lease that says if I combine the income of the two tenants and one of them moves out the other tenant must move out or verify their gross income must be at least three times the rent? Thanks for any help.
Bryan
Depends are the area. In the Norfolfk area I try to keep my folks between 25-33%. However, in CA - You may go as high at 50% depending on your tenant. Not sure what the figures are now, but when I was out west 5 years ago - SF housing cost were averaging 44% on their income.
Depends are the area. In the Norfolfk area I try to keep my folks between 25-33%. However, in CA - You may go as high at 50% depending on your tenant. Not sure what the figures are now, but when I was out west 5 years ago - SF housing cost were averaging 44% on their income.
Im pretty sure you can. I did for my tenants and they had no problem with it. Maybe this varies with state
Yes, you can also go here to see if the SSN is valid and which state it originated in
http://www.searchbug.com/peoplefinder/verify-ssn-free.aspx
You want to run at a minimum, sexual predator check, outstanding warrants check, small claims check (evictions), most of these can be done online and for free. When you get them under lease, make sure you have that SSN, DL# and DOB in case yuo ever have to report them to a collection agency.
GL
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I ask for the social sec number on my application, if everythings checks out and I like what I see, then I will have them sign my lease agreement, which has their social security number, too!
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