I got a call yesterday. The polite young man was interested in a house that I currently have for rent. He indicated that he was looking for a place for himself. He had previously rented a room from some friends, but really had no credit history. Based on his current income, he didn't make enough money to cover the rent and utilities. He explained that he could have someone co sign the lease for him.
Landlords, do you rent to tenants that need a co signer to qualify to rent a property?
Although I always say this...every tenant's individual situation must be looked at on a case by case basis, before making a decison to rent to them or not. There is no hard, fast rule that covers every situation.
But, typically, I don't care to rent to tenant's that require a co signer in order to rent a property. Especially if that co signer will not be living in the house. I want the parties involved to all have a vested interest and an incentive to pay the rent. It helps when the roof is over THEIR head, and the co signer is not living somewhere else. More often than not, I don't rent to tenants that must have a co signer.
Which leads to my next question...do you rent to tenants where there is not one party living in the house that can afford the complete rent payment on their own?For instance,
I've had friends call me that want to move in together and each one has wanted to give me a check for their portion of the rent. I really don't care to do this. The ideal scenario is when one party makes enough money and is willing to be responsible for the lease and the entire month's rent, for the term of the lease.
I want to collect my rent on one house from one person, in ONE check.
I've seen landlords get into situations on one house, where they are collecting the month's rent from 3 different people. One person has the rent and the other two don't. I've also seen situations where one friend moves out, and the other party or parties cannot afford the rent any longer (because they couldn't when they first moved in). I don't do this either.
So, landlords and property managers I am curious to see what works for you, in your area.
This article is authored by Sandy Shores, Brevard County Real Estate
Melbourne Florida Real Estate News
that for you
Sandy, it all is about good property management and with your policy here I think you are being very financially prudent.
Hi Sandy
We have use co-signer on leases where there were possible credit issues with the tenant.
Good luck and success
Lou Ludwig
Surprisingly I've never run into a situation where a tenant has even brought up having someone co-sign on their lease. It may not be something that is very common in this area. I would imagine that if someone did bring this up I would have to refuse for the same reasons you brought up in this post. It just doesn't seem to make much sense to me. If the tenant does not pay the rent do I come after the co-signer? In our area we generally require one person to be on the lease who can pay the whole rent. 1 check 1 house. I can't imagine collecting rent from multiple people from the same address it sounds like a huge hassle.
Hi Sandy, as I confessed before, I stink at Landlording!! When we did have our rental, the first crew treated it like a hotel, I collected separate checks from each of them! It was ridiculous!!
Then we got tenants who paid one check- full rent- perfect! I'm not sure about the cosigner, except maybe a parent, for a student. I'm curious, did you rent to him?
Morning Sandy,
Guess I am out of touch here in Paradise..I hadn't heard of using a co-signer in a rental situation.
I have investment property which are rented to responsible parties. I expect payment in full each month in the form of cash or one check. In some cases there are more then one person residing at the property, however their space accommodation is handled by the person responsible for the lease. We limit how many may occupy the residence and their names must be furnished to the Property Management office prior to taking up residence. This may appear somewhat complicated, but it has been working well for us.
Sandy:
We allow co-signers, but make sure the co-signers realize that any eviction will name them as well. As far as income qualifying we require each roommate to qualify individually and let them know that they are each 100% responsible for the rent, and we do not accept partial rent, ie 50% from each. Must be one check, money order etc. This avoids the "my roommate moved out and I cant afford it by myself" trick. Good Luck from Merritt Island!!
Charles
Sandy,
I think you are correct it depends on the situation. If someone co-signs and does not live in the rental why would they care if the rent is paid? I had a similar situation but it was not my rental. the owner kept asking me if the people seemed trustworthy. I did not know these people. They were a sign call. I politely said, you need to make certain you want to rent to them. And left it at that.
One has to be careful,
Ann Hayden in 15 degree Wildwood, Missouri
Hi Gary, I think we must be very cautious in accepting co signers on our leases.
Hi Lou, Good to hear that you have had success with co signers.
Hi Justin, Interesting that you have no requests for co signers on leases.
Hi Mary, I think some people are cut out to be a landlord and some aren't. I did not rent to this particular person, as his income did not qualify for the home.
Hi Hal, It sounds like you have a system that is working beautifully for you! Great job!
Hi Charles, Sounds like you also have a great system in place. We must remain viligent as landlords and be sure that streamline our lives as much as possible.
Hi Ann, We must be very careful - so true! I hope you are bundled up today! 15 degrees - too cold for me!