Potential Tentant Filing For Bankruptcy
Potential tenant states that she and her husband are filing for bankruptcy to "clean up some old bills". Says her husband has a good job making much more than the 2-times-the rent we require. Says they are paying a lot more rent in the apartment than they will be in my house.
I've offered to cut the security deposit way down, but managed to keep the monthly rent up where I want it.
I'm seeing a lot of "zero move-in costs" ads in the area.
What do you think? Do I go ahead with the deal, or run like crazy?
Frank
I wouldn't run like crazy, I'd just walk briskly. Income of 2x rent is not much to write home about .It's pretty thin. How do you know they are paying their present landlord. What type of BK are they filing?
I wouldn't decrease my security deposit with them, I'd increase it to 1.5-2 times rent.
I little off subject. But when I read your question it made me wonder - Do you have a tenant screening process? Do you (1) run a credit report on all adults (2) call their former land lords to verify rent, late pays, property distruction, evictions (3) look up county records for any evictions (4) verify their income or at least look at current pay stubs?????
I would call on the "zero move-in costs" and see what if there is a catch. Good to know the compition. Although apartments are not direct competition. Some people just want a house.
BTW - I require 3 times the rent and I think that is pretty standard.
To answer you question. I have not heard of a bankruptcy being a concern to a standard lease. But maybe others can chime in.
Brenda
Thanks for the replies.
I am planning to use one of the screening services suggested elsewhere on this site.
I may also drop by their current apartment to have them sign an additional form that I "forgot"... So I can see how badly they have maintained the place.
Brenda, can you really get 3 times the rent for the security deposit? I am under the impression that I am limited to 1.5 times.
Frank
If you reduce or remove the deposit you will regret it when they leave. Are they complaining about move in costs, why are you looking to reduce them ?
On occasion I will let them pay me 1/2 when they move in and 1/2 next month or even go 2 months but you need to have that deposit for repir costs or lost rent (if they leave owing you) when they move out. Plus deposit is motivation to leave you a clean place instead of just walking away.
I require 3 times the rent in income as one of my tenant screening criteria. In my area to be competitive - I require just a little less than one months rent for security deposit.
Brenda
I think that rather than upping the security deposit....ask for the full security deposit upfront. Then make arrangements on the rent. That way you have the deposit (you need this). Tenants have a hard time paying you a deposit after you move in...they do pay back rent though and if they don't you can evict them easier. I hope this helps.
Frank
In the past I've either put off the deposit or did'nt require it to fill vacancies quik.
NEVER NEVER again I've been taken every single time. It dosnt happen anymore because I always require a deposit up front now.
If they cant pay the deposit they'll find a reason they can't pay the rent also.
From experience
ED
DONT let anyone move in without a deposit..... You are asking for trouble.
DONT let anyone move in without a deposit..... You are asking for trouble.
DOUBLE TROUBLE IN FACT!