Top 11 Reasons to Decline Any Rental Applicant
Many landlords fear litigation when declining an applicant and thus may reluctantly approve the wrong one. The cost of vacancy is also a driving force that may cause a landlord to make a bad decision.
Then there are the ‘professional renters” who ask scripted questions written by a bottom feeding attorney waiting for the wrong answer so they can slap you with a frivolous lawsuit.
So, it may be good to know the top reasons to decline any applicant.
1) Unsatisfactory references
Ask for family, friends, employer, and landlord references and call them all. Verify that you are speaking with the actual landlord by getting the purchase price online for the property and ask the landlord “what did you pay for the property?” If they cannot answer that, you are not talking to the landlord.
2) Any eviction
Shows lack of concern to mediate, work out a solution or to simply move out. Make sure you run a nationwide eviction report as most California evictions are sealed.
3) Frequent moves
You must decide what constitutes frequent moving and apply the same criteria to every applicant.
4) Too short a time on the job
As with frequent moves, you must decide what too short a time is and apply the same criteria to every applicant.
5) Verify income
Get two most recent pay stubs and bank statements and look at debit card activity. If self-employed, get two years tax returns. A good rule of thumb is three times income to rent.
6) Poor credit
Run your own a credit report to ensure there are not any unpaid bills, collections, or have judgments. Require a credit score of 650 or higher and apply to every applicant.
7) Criminal activity
Most crimes cannot be discriminated against, so be sure to run a nationwide criminal report to uncover as much as you can. The manufacturing or distribution of illegal substances is the strongest case for rejecting an applicant.
8) Over occupancy
The rule of thumb with the Fair Housing Council is two per bedroom, plus one on the couch.
9) Drug users
They must be current drug users. If they are in a drug treatment program and no longer use drugs, the Federal Government considers them handicapped and protected by the Fair Housing Act.
10) Pets
Run all pets through a third-party pet screening service called PetScreening.com to limit your liability when rejecting a pet or to reluctantly approve a pet and save a lawsuit.
11) High debt
A rule of thumb is that all debt, including rent, cannot exceed 50% of their gross income. Debt would be such things as credit card payments, car payments, loans, etc. and not be cable, telephone, or utilities.
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