Author Topic: Do you choose tenant by first come first serve?  (Read 2648 times)

sequoia

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Do you choose tenant by first come first serve?
« on: September 19, 2017, 10:37:27 PM »
So we have several rentals, but all of them are managed by someone, so we never pay too much attention to the details. We thought we want to try to manage one of them ourselves - baby step here :) and the opportunity may present itself.

To make long story short, this property used to be for rental. The renter moved out, and we fixed a bunch of things, and we are trying to sell the property. We had a potential buyer, but just find out that they may not be as qualified as they said (long story here).

So if that does not work out, we will rent the property out. So we have been reading and having a crash course what to do when looking for tenants. Luckily this property is on a desired area but it seems that we may missed the summer window where everyone is buying houses. We had several individuals who called asking if we would rent it out instead of selling it.

So here is the question:

What is not entirely clear to me, is if we are required to choose tenants by first come first serve. Let's say person A, B, C had contacted us when the house is for sale. We said at this point we are not renting it out, but we told them we will keep their numbers in case things change in the future. We do not promise anything to anyone.

Lets say now we want to put the house back for rent. Are we required LEGALLY to contact A, B, C first and see if they qualified (fill out application, credit check etc)? Or can I put out an ad as well, and if we find person D to be qualified, we can get person D as tenant? I understand person A,B and C may not like it if they find out, but LEGALLY, do we cross the line here? My guess is no since no applications were filled, no paperwork, no promise,etc, but again, I am not completely clear on this. I may have over-thinking this.

Another un-related question, do you process applications simultaneously? or one by one until you find the person who qualify?


EarthSurfer

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Re: Do you choose tenant by first come first serve?
« Reply #1 on: September 20, 2017, 12:15:29 AM »
You have no obligation to contact or follow up with anyone who contacted you about possibly renting the property. The property was not available at the time they expressed interest.

If you wish to contact someone who expressed interest, I don't there is a legal obligation to include others you did not desire to contact. As always, these is an "EXCEPT" if your choice to not contact someone is solely due to their being a protected minority class in the jurisdiction of the Rental.

Yiu should establish a clear and written standard for qualifying tenants. I used a slightly modified criteria list from a professionally managed apartment building in my area. I modified it to match criteria reported by the tenant background checking service I used.

I am very clear with prospective tenants about the application fee & process, eligibility requirements, deposit agreements, and dates for occupancy and rent payments. I have found the application  fee along with the written eligibility requirements does an effective job of self screening applicants.

As always, use the best background verification you can afford. I usually add $20-30 to the application fee to have judgments, convictions and other potentially illuminating information.


srad

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Re: Do you choose tenant by first come first serve?
« Reply #2 on: September 20, 2017, 09:15:15 AM »
You are fine, no application, no problem.

Some cities require a first come first serve.  I know Seattle is one of  them. But to a city that does that, good luck at identifying my first in completed application. 

The way I do it is I  start with clear requirements for app process in the listing, 3x rent, all deposits up front, no evictions...  When showing the unit, i never have the applications in the unit.   I leave them in my car and if i don't like the person i say "Shoot, i left the applications at home, i'll email it to you."  Then i don't email it..  And usually before they hit me back i already have a tenant with filled out paperwork.  I've gotten pretty good at phone screening so i don't have to use this tactic too often.  If i like the person, i'll give them an app, then it is who gets their paperwork back to me first.

I'm not discriminating, i'm just picky.  And honestly if someone meets my requirements, i'm probably going to rent to them.  Ok maybe i'm a little discriminating, about a year ago i had some dude with a bunch of neck tattoos show up, and not the I"m artsy type.   i was like um, nope. 

Cwadda

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Re: Do you choose tenant by first come first serve?
« Reply #3 on: September 20, 2017, 09:25:58 AM »
You are fine, no application, no problem.

Some cities require a first come first serve.  I know Seattle is one of  them. But to a city that does that, good luck at identifying my first in completed application. 

The way I do it is I  start with clear requirements for app process in the listing, 3x rent, all deposits up front, no evictions...  When showing the unit, i never have the applications in the unit.   I leave them in my car and if i don't like the person i say "Shoot, i left the applications at home, i'll email it to you."  Then i don't email it..  And usually before they hit me back i already have a tenant with filled out paperwork.  I've gotten pretty good at phone screening so i don't have to use this tactic too often.  If i like the person, i'll give them an app, then it is who gets their paperwork back to me first.

I'm not discriminating, i'm just picky.  And honestly if someone meets my requirements, i'm probably going to rent to them.  Ok maybe i'm a little discriminating, about a year ago i had some dude with a bunch of neck tattoos show up, and not the I"m artsy type.   i was like um, nope.

In my eyes, this is quite discriminatory.  I give EVERY SINGLE PERSON who comes to look at the apartment an application, even if they do not apply.  I have them sitting right there on the table, soon as they walk in.  Then I email them another copy of the application. 

srad

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Re: Do you choose tenant by first come first serve?
« Reply #4 on: September 20, 2017, 09:31:07 AM »
So question, a lady comes to your open house, drives a very nice jeep cherokee, you peak outside at it and its packed to the brim with trash.  You rent to them?

nereo

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Re: Do you choose tenant by first come first serve?
« Reply #5 on: September 20, 2017, 09:37:39 AM »
First come first serve is a really stupid way to choose applicants (local laws aside). It rewards people based on their ability to stalk properties online and how 'lucky' they are, and completely disregards whether they would be a good tenant.

Also agree with Cwadda that deliberately denying individuals an applicaiton is the epitome of being discrimination. You're basing your decision on 'feelings' about the person over the phone, which is a pretty awful way to do it. All people have biases and prejudices - you're not even trying to voercome them.  Someone who doesn't have the color, shape or background you prefer might have excellent references and a solid history.

So question, a lady comes to your open house, drives a very nice jeep cherokee, you peak outside at it and its packed to the brim with trash.  You rent to them?
I look at this application to avoid making stupid judgements like this.  Maybe she's headed to the dump or has been helping clean up some place. My car's frequently trashed becuase I used it as a work vehicle at various field stations, many of which don't have trash service.
What do I care if her jeep is dirty if she's a good tenant with a good rental background?

Cwadda

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Re: Do you choose tenant by first come first serve?
« Reply #6 on: September 20, 2017, 09:40:55 AM »
I have a few comments for you sequoia, I'll quote each piece:

Quote
So if that does not work out, we will rent the property out. So we have been reading and having a crash course what to do when looking for tenants. Luckily this property is on a desired area but it seems that we may missed the summer window where everyone is buying houses. We had several individuals who called asking if we would rent it out instead of selling it.
In your tenant search, try to narrow down tenants who might be looking to buy a house in the future.  If they really like the place, you might be able to sell it to them without using a realtor!  Everyone benefits.  Another thing to take into account is the timing.  If you set them up on a 1 year lease it's going to bring you to next October, and again, you're in a rut for selling. It might be more advantageous to go with an 8 month lease, if possible. It's a bit of a tricky situation.  Redouble your efforts to sell before Thanksgiving this year, if you really want to sell.

Quote
What is not entirely clear to me, is if we are required to choose tenants by first come first serve. Let's say person A, B, C had contacted us when the house is for sale. We said at this point we are not renting it out, but we told them we will keep their numbers in case things change in the future. We do not promise anything to anyone.
You are under no obligation by law to get back to anyone, nor review applications in any particular order.  If you do show the place though, it's common courtesy to let them know when you'll get back to them.  It's also wise, in my opinion, to give everyone an application that comes to see it.  I also send an email with written explanation as to why their application has been denied.

Quote
Another un-related question, do you process applications simultaneously? or one by one until you find the person who qualify?
In practice, ALL of the tenants that apply are already qualified and it comes down to choosing who I like best.  This is because I have all of my qualification parameters written up front and am completely transparent about them.  No smoking, no pets, 3x monthly rent income requirement, credit score of 650+, no prior evictions, no drugs, etc.  If any of these parameters are unmet, I won't show them the property.  I ask them on the phone if they read and understand all the qualifications.  If they later apply and clearly don't meet the qualifications, it's fairly obvious they lied and are therefore instantly DQ'd.
« Last Edit: September 20, 2017, 09:49:52 AM by Cwadda »

Cwadda

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Re: Do you choose tenant by first come first serve?
« Reply #7 on: September 20, 2017, 09:46:44 AM »
So question, a lady comes to your open house, drives a very nice jeep cherokee, you peak outside at it and its packed to the brim with trash.  You rent to them?
You're forming an opinion on someone based on the state of their car? What the hell?  I run an Amazon business and my car is packed with shit all the time.

Ironically enough, I just signed a tenant who drives a new Jeep Grand Cherokee and is messy, but works 80 hours a week and makes 5x her monthly rent.  She also told me her father would be cosigning even though it wasn't needed.  She also signed for 2 years and pays her rent 3 days in advance.  Go figure. 

If you're judging people based on the tidiness of their cars, clearly landlording isn't for you. Or you just need a new perspective.

srad

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Re: Do you choose tenant by first come first serve?
« Reply #8 on: September 20, 2017, 09:54:17 AM »
First come first serve is a really stupid way to choose applicants (local laws aside). It rewards people based on their ability to stalk properties online and how 'lucky' they are, and completely disregards whether they would be a good tenant.

Also agree with Cwadda that deliberately denying individuals an applicaiton is the epitome of being discrimination. You're basing your decision on 'feelings' about the person over the phone, which is a pretty awful way to do it. All people have biases and prejudices - you're not even trying to voercome them.  Someone who doesn't have the color, shape or background you prefer might have excellent references and a solid history.

So question, a lady comes to your open house, drives a very nice jeep cherokee, you peak outside at it and its packed to the brim with trash.  You rent to them?
I look at this application to avoid making stupid judgements like this.  Maybe she's headed to the dump or has been helping clean up some place. My car's frequently trashed becuase I used it as a work vehicle at various field stations, many of which don't have trash service.
What do I care if her jeep is dirty if she's a good tenant with a good rental background?

Look I hear you,  i'm really talking about the extremes you get.  You could tell the lady wasn't going to the dump.  Renting my units is usually very straight forward, I qualify people over the phone, meet them at the unit, give them an app, check their references and rent to them. 

Cwadda

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Re: Do you choose tenant by first come first serve?
« Reply #9 on: September 20, 2017, 10:13:05 AM »
Quote
You could tell the lady wasn't going to the dump.
OK, whatever you say.  I'm not going to act like I have a moral high ground over you and therefore win any sort of argument.  I'm merely suggesting you NOT judge people based on the state of their vehicle. You could be missing out on fantastic tenants.

Quote
give them an app
Yeah, I'd recommend giving everyone an app, even if they don't apply.  It's just a sure-fire way to not get yourself in trouble with the law.

clarkfan1979

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Re: Do you choose tenant by first come first serve?
« Reply #10 on: September 20, 2017, 10:23:31 AM »
I have a criteria that is written out. I score all tenants on my criteria when they look at the property. I rent to college students and score them on maturity.

One group of kids looked at the house and said, "This is a good space for sick parties." They were scored low on maturity.

I don't share my scoring sheet with the tenants. However, if they accused me of discrimination, I'm sure that I would have to share it with the courts.

tralfamadorian

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Re: Do you choose tenant by first come first serve?
« Reply #11 on: September 20, 2017, 10:43:47 AM »
If you're judging people based on the tidiness of their cars, clearly landlording isn't for you. Or you just need a new perspective.

100% disagree.  Probably the best way for a landlord to evaluate someone's cleanliness habits is the state of their transportation when they look at the property, aside from their person. 

Cwadda

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Re: Do you choose tenant by first come first serve?
« Reply #12 on: September 20, 2017, 11:05:53 AM »
If you're judging people based on the tidiness of their cars, clearly landlording isn't for you. Or you just need a new perspective.

100% disagree.  Probably the best way for a landlord to evaluate someone's cleanliness habits is the state of their transportation when they look at the property, aside from their person.

Context.  srad had said he/she leaves applications in the car and tells prospective tenants it was forgotten at home if said tenant has a bunch of tattoos or has a messy car.

nereo

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Re: Do you choose tenant by first come first serve?
« Reply #13 on: September 20, 2017, 11:19:05 AM »

Quote
give them an app
Yeah, I'd recommend giving everyone an app, even if they don't apply.  It's just a sure-fire way to not get yourself in trouble with the law.

Probably the best advice on a subject we may not agree with.  This is standard business practice too - instantly reduces the chances that someone will file a complaint that "I was discriminated against because I am black/gay/libertarian/old/etc".  No, you weren't selected because you weren't the best candidate and I have applications to back that up. Case dismissed.

If you're judging people based on the tidiness of their cars, clearly landlording isn't for you. Or you just need a new perspective.

100% disagree.  Probably the best way for a landlord to evaluate someone's cleanliness habits is the state of their transportation when they look at the property, aside from their person. 
IMO the best way to evaluate someone's habitats is through their application, particularly references from previous landlords. Cars aren't a great indicator (IMO); mine's trashed often but I'm a neat freak in my own home.  A single question of "would you rent to this person again" made to their previous landlord tells me volumes more than whether they have fast-food wrappers in their car, and their credit history tells me more about whether they'll pay on time than whether they wear a suit when meeting me. YMMV, but for legal purposes I always give applications out to anyone who asks anytime I"m searching for a new tenant.

srad

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Re: Do you choose tenant by first come first serve?
« Reply #14 on: September 20, 2017, 12:02:27 PM »

[/quote]

Context.  srad had said he/she leaves applications in the car and tells prospective tenants it was forgotten at home if said tenant has a bunch of tattoos or has a messy car.
[/quote]

Context - I said certain tattoos and an extremely messy car.  I actually have a tenant with neck tattoos and its next door to the one i said no to the other guy on.  My car is a dump too because i'm always working on something.  Its pretty easy to tell a working car from a car that is trashed beyond reason.  I've been a landlord with multiple units for 12 years now, and I also did a side gig for a number of years managing a couple more units for someone i bought a rental from.  So yes, i am going to have some WTF stories.  These two cases were both pretty recent too.  I can go back in time and tell more if someone wants to hear them!


sequoia

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Re: Do you choose tenant by first come first serve?
« Reply #15 on: September 20, 2017, 04:03:09 PM »
Whoa I did not expect this many replies. Thank you guys and gals - really appreciate the stories and opinions!  Keep them coming if you do not mind to share.

Like I said, this is the first time we do this without hiring someone to manage the property, so definitely a new world for us.

SwordGuy

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Re: Do you choose tenant by first come first serve?
« Reply #16 on: September 20, 2017, 05:25:21 PM »
We have written qualification criteria.  First to meet those requirements gets to rent the property.

We have a property management company do the initial screening on income, credit and rental history and criminal background.   When we evaluate a tenant, we've never met them, don't know what they look like, sound like, or what their name is.   I suppose someone could sue us for discrimination but I don't see how it would stick.

It's been working for us so far...

If we didn't have day jobs and took on that responsibility for ourselves, we might follow my uncle's advice.  He has about 30 properties.   He likes to go look at where they live NOW and factor that into his decision to rent.   If they keep the place clean and tidy, and haven't trashed the place, he's more interested in renting to them.