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Question for landlords: Credit checks, what's up?

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Question for landlords: Credit checks, what's up?

Old 10-24-04, 10:16 AM
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Question for landlords: Credit checks, what's up?

kvrdave and others: I've got an apartment that I'm looking to rent but given that it's a crummy time of year to be looking for a tenant I thought I'd try to sweeten the pot by offering up the place without a realtor (I'd still give out the listing, but also thought I'd do an open house myself and see what happens)

What should I look for? What's the right way to do a credit check? I remember apt. applications asking for my bank acct number and stuff like that. What do I do?
Old 10-24-04, 11:53 AM
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You can buy generic rental apps. You can probably even find them online.
Old 10-24-04, 11:57 AM
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Most apartments have agencies which will do a credit check for you. I guess you could try to look for one.
Old 10-24-04, 02:41 PM
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There are credit places online you can use. What do you mean by "offering up the place without a realtor (I'd still give out the listing, but also thought I'd do an open house myself and see what happens)"?

Is it for sale as well?

Anyway, we use an online credit/background check place. For the type of renters I get, the background is a lot more important than the credit score. I generally require a score of at least 150.
Old 10-24-04, 03:23 PM
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score of 150? mine was in the 700's... who the HELL are you renting too?
Old 10-24-04, 03:28 PM
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Originally posted by jasonr114
score of 150? mine was in the 700's... who the HELL are you renting too?
slumlords can't be too picky.

birrman54
Old 10-24-04, 03:36 PM
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Originally posted by kvrdave
There are credit places online you can use. What do you mean by "offering up the place without a realtor (I'd still give out the listing, but also thought I'd do an open house myself and see what happens)"?

Is it for sale as well?
I think Gil's in New York, so... most apartments are listed through brokers (or realtors), which saves the owner the hassle of showing the apartment and screening applicants.
Old 10-24-04, 03:51 PM
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Originally posted by TracerBullet
I think Gil's in New York, so... most apartments are listed through brokers (or realtors), which saves the owner the hassle of showing the apartment and screening applicants.
Ah, but they don't actually manage it? So those realtors show it and get some kind of fee for finding the renter? That's interesting.

jasonr114 - I rent to people who rarely have checking accounts. Actually, I'll bet nearly half do right now. That's a first.
Old 10-24-04, 03:58 PM
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In NYC the renters pay a broker's fee for someone finding them an apartment. 2 months rent I think is the average.
Old 10-24-04, 04:08 PM
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Originally posted by kvrdave
Ah, but they don't actually manage it? So those realtors show it and get some kind of fee for finding the renter? That's interesting.
I think it's just the way the real estate market in NYC developed. Something like 75% of the housing in Manhattan is rental (probably less overall percentage if you take into account all the boroughs, but still much higher than most other places). So since people are mostly looking for rentals, they pay a fee and let the broker do the gruntwork for them.
Old 10-24-04, 04:21 PM
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I had horrible luck trying to rent my house through realtors. They didn't have any of the know-how that property managers typically have and rented my house to bums three times in a row. The last one quite possibly sold crack out of it and stole all my fixtures (chandaliers, brass faucets, not to mention the fridge. Bitch. ) Another tenant took off without paying her utilities and I ended up having to pay them for her. The best tenant--the cream of the crop--left the house so messy it cost us several hundred dollars to clean it up.)

I know there are probably great realtors out there who know how to rent property, but the husband and wife realtor team I used sucked--they took a whole month's rent (twice, though the third time they gave me a "freebie" since they'd done suck a suckee job of screening before) and chose crappy tenants every time.

Last edited by tasha99; 10-24-04 at 04:24 PM.
Old 10-24-04, 04:25 PM
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Exactly. SOP is for an agent to find you an apartment, charge you some fee, and then go away. When looking for an apt often "NO FEE" listings are very attractive, so I thought I might go that route when renting out the apt upstairs.

Dave, what online credit checking service do you use?

ETA: Tasha, I hear that. I used to sublet my old manhattan apartment and used an agent. Most of the tenants were fine but one really wrecked the place. How anyone can do so much damage to a 300 sq ft studio is beyond me. If I ever saw that idiot on the street I'd probably slap her with a large trout.
Old 10-24-04, 04:26 PM
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tasha99...sounds like you need to do a better job of picking people (realtor and tenants)

-pedagogue
Old 10-24-04, 04:28 PM
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Originally posted by Gil Jawetz
Exactly. SOP is for an agent to find you an apartment, charge you some fee, and then go away. When looking for an apt often "NO FEE" listings are very attractive, so I thought I might go that route when renting out the apt upstairs.

Dave, what online credit checking service do you use?

ETA: Tasha, I hear that. I used to sublet my old manhattan apartment and used an agent. Most of the tenants were fine but one really wrecked the place. How anyone can do so much damage to a 300 sq ft studio is beyond me. If I ever saw that idiot on the street I'd probably slap her with a large trout.
www.tenantscreeningservices.com is one that I have heard of.
Old 10-24-04, 04:42 PM
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Originally posted by kvrdave


Anyway, we use an online credit/background check place. For the type of renters I get, the background is a lot more important than the credit score. I generally require a score of at least 150.
Isn't 350 the lowest score you can get?
Old 10-24-04, 04:47 PM
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Originally posted by pedagogue
tasha99...sounds like you need to do a better job of picking people (realtor and tenants)

-pedagogue
We didn't have the money to go back to fix things, partly because our tenants weren't paying us. (My (now ex) husband was stationed in Hawaii, but the house we bought was in Kentucky. We had this "genius" idea of buying a house and only living in it when he was overseas so that when he got out, we would own a house. Didn't really work out that way.) We ended up selling the house for a $10,000 loss, which by the time we sold seemed like a bargain. Wish we'd just sold to begin instead of trying to rent long distance like that.
Old 10-24-04, 04:59 PM
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Originally posted by asabase
Isn't 350 the lowest score you can get?
You haven't seen my tenants.

Thank you, folks...I'm here all week. Try the veal.


Gil = The service I use only does background checks for WA and OR, so they wouldn't do you any good. Sorry. What do you normally pay a realtor for that service? Sound like an actual property manager would be better, but who know if they even have that.

My property manager charges 8-10% of the rent, but he does everything. He pays all the bills, does the screening, arranges any work, bids, etc. pays insurance, mortgage, etc. All the owners do is get a check once a month. We find that if he has to deal with the renters that he picks, he picks better renters.
Old 10-24-04, 06:23 PM
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That's the thing. The real estate agent is free for the landlord. They find the tenant, the tenant pays them a month or two rent and then that's that. So that's why landlords use them. No pertetual cost or really any cost at all. But of course you might still end up with a crap tenant if you aren't diligent in which case you might as well screen them yourself and save them a few bucks, making your property more attractive in a super competitive market.
Old 10-24-04, 07:11 PM
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Originally posted by Gil Jawetz
That's the thing. The real estate agent is free for the landlord. They find the tenant, the tenant pays them a month or two rent and then that's that. So that's why landlords use them. No pertetual cost or really any cost at all. But of course you might still end up with a crap tenant if you aren't diligent in which case you might as well screen them yourself and save them a few bucks, making your property more attractive in a super competitive market.
What an odd deal. I can see why it is a good deal for the buyer, but I would be pretty cautious as an owner. Their duty is to the buyer, so it doesn't matter what the buyer is like. They want to make them look good, get them in, get paid, and move on.

I suppose if you got good tenants, it would be fine, but I can see why you did an open house yourself.
Old 10-24-04, 08:45 PM
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Originally posted by Gil Jawetz
That's the thing. The real estate agent is free for the landlord. They find the tenant, the tenant pays them a month or two rent and then that's that. So that's why landlords use them. No pertetual cost or really any cost at all. But of course you might still end up with a crap tenant if you aren't diligent in which case you might as well screen them yourself and save them a few bucks, making your property more attractive in a super competitive market.
I'm not sure why any tenant would do that --why pay a whole month's rent just to be shown an apartment? I could see an arrangement like that working where there is little vacancy (reasonably priced apartments in NYC etc) but in most areas, an extra month's rent would price a rental out of the market.

We had a real estate agent show our house as a rental only because that area in Kentucky had absolutely no property management companies. We paid though, not the tenant.
Old 10-24-04, 09:02 PM
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I think you've uncovered the secret truth: The NYC real estate market is on crack. Normal rules don't apply, from what you get for your money to how you get it.
Old 10-24-04, 11:31 PM
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I have a house that I rent to tenants, and have had success twice picking good people (2 for 2 so far), without realtors.

Here's what you do...

There are several generic rental applications you can get. You'll need SS#, previous landlord, etc.

Go to www.myfico.com Look on the bottom of the page. You can get an instant online credit score for something like $12.95. Regardless of what anyone else said above, the scores go to about 800 (slightly above). Anything above 720 is considered outstanding. Anything below the mid 600s could be a problem. Trust this score. If they say, "Oh, it's low because my ex-husband blah blah blah..."or whatever, forget them. Next applicant. Period. Trust this number.

Defintely get references from their current landlord. Find out if rent was paid on time, how long they were there, were there any complaints, any domestic troubles reported, etc.

Veryfiy employment (please do this). Find out how long they've been there, salary, etc...

Get 3 months bank statements-- you want to see there's something backing up all this paper in front of you.

And use your judgement when you meet them.. what's your gut feeling? (this isn't the most important factor, but if somebody's borderline, and you have a bad feeling about them, it's probably not a good sign).

If they don't want to give you their SS #, or any of the above info., run like hell. Just think, if you or I were renting, wouldn't you be happy to provide this?

Insist on photo I.D. when signing the lease. Make a copy.

Check if they have pets. If you don't want smoking, etc. put it in the lease and insist on it.

Having a bad tenant is a nightmare-- it will cost you thousands.

Good luck, hope this helps.
Dave

Last edited by Dave7393; 10-24-04 at 11:35 PM.
Old 10-25-04, 07:28 AM
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Thanks for the great advice!
Old 10-25-04, 11:53 AM
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That is great advice. When you call the past landlord, there is one question that matters more than any other. And I have found that most won't tell you this unless you directly ask it.

"Would you rent to these people again?"

So simple. My own rental manager will only answer the questions he is asked, and often people end up renting to people he would never touch again.

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