Need help finding the right tenants but don’t know what to look for

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    Hi guys,

    Looking for tenants for two apartments has been an eye-opening experience and I now realize that we do not know what to look for either good or bad.

    I suppose we should know what to avoid, more than anything. How do we steer clear of deadbeats that are familiar with working the system. Not concerned with which reports to run (credit, etc) rather what red flags.

    Also, what would you guys advise to look FOR in tenants?

    Thanks in advance.

    40 Replies

    1. I just rented out 2 apts in my owner-occupied building in Park Slope. I didn’t use a broker, I only listed the apts in the NY Times, craigslist, and RDNY. We got plenty of nibbles very quickly and quite a few pretty good quality applicants. Both were leased out in only two weeks to tenants I feel pretty good about. Now I just have to hope it doesn’t turn out be a disaster.

      I think we got a fair amount of interest quickly because I intentionally priced it a bit below what seemed to be the comps. The comps on the NY Times (which were all broker listings) were especially high. Getting a lot of good applicants in quickly gave us greater choice in picking a person to share the building with (as opposed to just collecting a check from an investment property). I got a lot of leads from the NY Times, so I think the $100 for 2 weeks is worth it (if you’re pricing the unit to possibly move in 2 weeks).

      I was very pleasantly surprised by the quality of applicant from craigslist. I was quite concerned after reading the posts in this Forum.

      I would recommend screening for income (and whatever else) by email when you get a nibble. If people want to apply, ask some more questions before taking an application. No need to waster your time or their credit check fee.

      Having done it myself, there is no way I would pay 1 months rent to a broker to perform this service. If I owned 10+ units, it may be a different story, but 1-2 units is very manageable on your own. I also suspect that brokers suggest inflated rent bc it doesn’t cost them anything to ask too much. But months of delay can cost the landlord a lot.

    2. I just rented out 2 apts in my owner-occupied building in Park Slope. I didn’t use a broker, I only listed the apts in the NY Times, craigslist, and RDNY. We got plenty of nibbles very quickly and quite a few pretty good quality applicants. Both were leased out in only two weeks to tenants I feel pretty good about. Now I just have to hope it doesn’t turn out be a disaster.

      I think we got a fair amount of interest quickly because I intentionally priced it a bit below what seemed to be the comps. The comps on the NY Times (which were all broker listings) were especially high. Getting a lot of good applicants in quickly gave us greater choice in picking a person to share the building with (as opposed to just collecting a check from an investment property). I got a lot of leads from the NY Times, so I think the $100 for 2 weeks is worth it (if you’re pricing the unit to possibly move in 2 weeks).

      I was very pleasantly surprised by the quality of applicant from craigslist. I was quite concerned after reading the posts in this Forum.

      I would recommend screening for income (and whatever else) by email when you get a nibble. If people want to apply, ask some more questions before taking an application. No need to waster your time or their credit check fee.

      Having done it myself, there is no way I would pay 1 months rent to a broker to perform this service. If I owned 10+ units, it may be a different story, but 1-2 units is very manageable on your own. I also suspect that brokers suggest inflated rent bc it doesn’t cost them anything to ask too much. But months of delay can cost the landlord a lot.

    3. I just rented out 2 apts in my owner-occupied building in Park Slope. I didn’t use a broker, I only listed the apts in the NY Times, craigslist, and RDNY. We got plenty of nibbles very quickly and quite a few pretty good quality applicants. Both were leased out in only two weeks to tenants I feel pretty good about. Now I just have to hope it doesn’t turn out be a disaster.

      I think we got a fair amount of interest quickly because I intentionally priced it a bit below what seemed to be the comps. The comps on the NY Times (which were all broker listings) were especially high. Getting a lot of good applicants in quickly gave us greater choice in picking a person to share the building with (as opposed to just collecting a check from an investment property). I got a lot of leads from the NY Times, so I think the $100 for 2 weeks is worth it (if you’re pricing the unit to possibly move in 2 weeks).

      I was very pleasantly surprised by the quality of applicant from craigslist. I was quite concerned after reading the posts in this Forum.

      I would recommend screening for income (and whatever else) by email when you get a nibble. If people want to apply, ask some more questions before taking an application. No need to waster your time or their credit check fee.

      Having done it myself, there is no way I would pay 1 months rent to a broker to perform this service. If I owned 10+ units, it may be a different story, but 1-2 units is very manageable on your own. I also suspect that brokers suggest inflated rent bc it doesn’t cost them anything to ask too much. But months of delay can cost the landlord a lot.

    4. Not everyone thinks the same way I do, but I do not want to even meet the potential tenant until they have been vetted by somebody ELSE. I use a broker, they get the paperwork, if the tenant looks like he/she is stable, all the checks have been done and they seem like they would be good for the place, then I will meet at a coffee shop to talk with the potential tenant and the broker. There I try to get a sense of whether the person would be happy in the house and would fit (I live there, and have one other tenant) and then after that meeting, I will decide. If yes, we sign the lease and do a walk through.

      I have great tenants and I guess I can say that I don’t do this much because the tenants I have are very happy and have been here from the beginning. Well, actually I inherited one tenant who was a nightmare, learned about NYS tenant/landlord court, got rid of her and decided that I was never going to go through that again. So far so good.

    5. Just wanted to thank everyone for their thoughtful reponses. Brokelin – thanks for taking the time to post.

    6. And, to disagree with what is above, you’ll have less trouble keeping renters if you rent the same whether you live there or not. Because your other tenants have to live with the other tenants. Yes, YOU may not be kept up by another tenant’s noise late at night if you don’t live there, but if your other tenants have to because you don’t take as much care to screen tenants as you would if you also lived there, you will have more turnover. And you are giving your tenants the (correct) impression that you don’t give a damn about the habitability of their apartment.

    7. Also, going through a broker will also eliminate a lot of financially responsible people. Unless you price your place lower such that when the broker’s fee is divided into 12 months and added to each month’s rent, it would come out the same as a comparable apartment. You might lose some anyway, as brokers usually cost the tenant, and are a pain sometimes to deal with, so many might pass it up anyway. You could pay the broker’s fee yourself – and have them advertise it as a no fee apartment. (It all comes out in the wash – it is part of the rent, however you look at it, whoever pays it. Kind of like the employer portion of social security taxes – it is still part of the employee’s salary cost.)

      I paid broker’s fees a few times, but not in decades, and I wouldn’t do so again. A waste of funds. With the internet, there is no reason to pay one – you can easily find apartments posted directly by landlord, or through word of mouth. I’ve gotten my best apartments, too, by word of mouth or no fee directly through landlords. That’s how the good ones get rented. Brokers often have a lot of crap to show you.

      Keep up the word of mouth. Advertise in local areas where there will be professionals – like if you live near a university, a hospital, etc. Put up a note in a bookstore if there’s one nearby, or a fancy coffeeshop if there’s one nearby with a bulletin board. Ask friends who work in Manhattan whose companies have either an informal newsletter, a bulletin board, or just a culture where opportunities like a place to rent can get emailed out to other workers. (Skip churches – they help people in financial trouble.) You’re advertising to a subset of the general populace when you do this, one likely to be more financially able to pay.

    8. …security back after I had moved out, but they never did, because they knew I was a good tenant, and that there would be no problem with the apartment other than the usual, minor wear-and-tear scuffs of living. I always left the apartment extremely clean, too – I’d even wash floors after the movers were gone. (Would I do this if I knew the landlord had a history of keeping all or part of the security for bogus reasons? Don’t know, haven’t been in that situation. Remember, tenants talk to each other too, so they get to know how trustworthy you are.) I appreciated the landlords not being a pain about the security, and wanted to make my leaving as easy for them as they made it for me. That’s how responsible people conduct business transactions.

      That’s how you get good tenants. Find trustworthy people, and treat them as if they were trustworthy. It really isn’t hard. If you don’t know how to do that, it makes me wonder if (1) you’ve never been a tenant, or (2) if you weren’t the best tenant.

      Credit scores matter – not for the score itself, but for the reason for the score. If there are many late payments, it can represent a pattern. I’d stay away from people with more than a couple of late payments if I were a landlord. Personal references are stupid, as I learned when calling them all for people moving into our coop – just about everybody can get someone to give a personal (or professional) reference. Doesn’t mean they won’t be a total pain in the ass, or pay their monthly check late.

      An employer letter sounds like a good idea, but no landlord has ever asked me for one. You can find out as much, if you want to know, by asking the tenant to show you x months of paycheck stubs, or a current one along with last year’s W-2. Why make the tenant bother their employer for a letter if they can give you the information in another format that is easier for them? Or give them the choice of how to show sustained income. You can always take copies of 1040s, but know they can be easily faked.

      I wouldn’t bother asking former landlords. Yes, sometimes they want the tenant to move out. Or they won’t call you back – they have no incentive to. I’d focus on my own gut instincts to the answers to questions when we meet, the credit report, and the job/income.

      Also, make sure your ad sound like you are responsible, trustworthy, and respectful when you write it. Some landlords sound so much of a pain in what they write, tenants who want reasonable landlords pass those ads by. A bad attitude towards tenants can come out in what you say, even if you aren’t aware of it.

    9. Your apartment sounds great, so I am thinking that it is your approach to marketing, and to how you view tenants, that needs tweaking.

      I owned a coop for a long time, but given that I moved to NYC after college with a lot of educational debt, and later went back to school for much more debt (always kept my payments up to date), I spent many more years as renter than as an owner. And I have always been a great tenant, both when I had little money, and when I had more. So that’s where this advice is coming from.

      If you want tenants who are responsible tenants, you must approach this as a responsible landlord. If you want someone with certain values about paying on time, etc., you have to embody those values yourself – including in how your relate to your tenants. That is how you attract great tenants.

      Like you said above, you are willing to conisder not giving a lease. Dumb, dumb, dumb – and not just for the reason stated above about making it easier to get rid of tenants (if you learn to attract great tenants, you will never find yourself in that situation.) If you are unwilling to give a lease, you have just emilimated almost all of the fiscally responsible tenants from considering your apartment. I would never, ever consider an apartment without a lease of at least a year. I try for two years, or, failing that, to include an option on a second year. Why? Because moving is expensive, and as a person who watches my spending (so that I am, and have always been, able to pay my bills on time and maintain good credit), I do not want to undertake to move unless I decide it is time to move. I would never live in such an open-ended situation, where I could be forced to move with little notice. (Also, I work hard, that’s how one maintains good work history, and an unanticipated move, having to scramble to find an apartment and move on short notice would mean I would likely have to take at least some hours away from work, and it might not be the best time to do that at work.) People who are responsible about both their work and their spending will not put themselves in this situation willingly. And since many people are willing to give a lease for a year, you are now, by definition, looking among the pool of tenants that is not the most responsible about planning ahead for contingencies such as moves. Am I making myself clear here?

      Ditto on asking for two months security (or first, security, and last, as that’s the same thing.) I’ve rented many apartments, and I’ve never, ever considered giving more than one month security. Again, if there are many apartments in the market asking for one month’s security, why would I, a fiscally prudent person, agree to give two? There are many landlords who don’t return security deposits, and many who deduct for things that are, by law, the landlord’s responsibility (exterior window washing in a high rise anyone? One landlord tried that on someone I know). Why would I, again, as a very fiscally prudent person, put two months security at risk when I could put only one? Again, when you ask for two months security, you eliminate the majority of your most fiscally prudent and responsible renters from considering your apartment.

      In fact, I have also never waited for the security to be returned to me, but have just written a note with my last month’s rent, explaining the end of my tenancy (after I had let them know, usually verbally if my landlord was a person and not a management company, that I was leaving before the end of the lease, and why – like buying an apartment, moving away to go to school, etc.) I would then write with my rent check something like – here’s the check for $100, which, in addition to the security deposit of XX, equals my last month’s rent, as my last day here will be x. (I’ve let them know I was leaving earlier, so they can make plans to rerent, and would have been willing to find the next tenant if they wanted me to, but they generally have preferred to do that themselves (as I would as a landlord), except in one instance when I was in college (when I was moving, reluctantly, because the landlord wouldn’t evict the family of drug dealers who had moved in above us and literally let us get no sleep, because he had imprudently raised the rent too high on the single mother and her daughter who had previously lived there – so that’s another lesson to you, don’t force out your good tenants for a few more bucks, it can have ramifications you haven’t considered), so I found the next tenant for him. I can’t imagine they stayed very long, either, unless they didn’t need sleep.

      I have never asked if it was OK with my landlord to cover my last month’s rent by deducting the security deposit from my last month’s rent (in my example, the rent had gone up $100 since my first year’s lease, but I hadn’t been asked to up the security deposit – some ask you to top it up to the new one month’s rent, some don’t, I’m indifferent to whichever they want, though it does seem a bit nicer if they don’t bother to ask for the additional security with each small rent increase). In each instance, this was fine with my landlord. Because by then they knew I was a responsible tenant, who paid my rent on time each month, and who took care of the place, sometimes painting and making small improvements. I figured they could come back at me and let me know they expected me to pay the whole last month’s rent, and then get my

    10. Your former LL might be right, but I would not skip a conversation with at least one reference and past landlord. Those conversations can often add a dimension, or a red flag, to the answers you’ve gotten from applicant. As to previous addresses and LL’s phone number(s), ask the applicant to provide them.

    11. Vinca – one of our former landlords, when we were renters, was an attorney and he once told me that every single person gets a good reference because if they are good tenants, it is the truth and if they are horrible tenants, they will become someone else’s problem and that has ALWAYS stayed with me.

      How do you verify previous addresses aside from what is listed on the credit report?

      Great point to ask about musical instruments because we like a quiet house. We are not unreasonable re: noise level but weekly raging parties at 2:00 am ain’t going to cut it.

    12. > OK, am purging the month-month idea

      Good. I think you would scare off a lot of good potential renters that way. I know I would never rent a place without a one or two year lease, unless I was specifically looking for a very short term situation.

    13. OK, am purging the month-month idea out fo my head.

      vinca,

      thanks for the good informative post as usual per the above.

    14. @coopfornow–«why would it make a difference what is rented out» gale said it as well as I could. If it’s units in an owner occupied building, you are going to have to live with these people(and they with you). Also there is a different mindset and values, I believe, for investors than for owner-occupiers, who usually aren’t really landlords in the common sense of the term.

    15. A month-to-month no lease situation is even more dangerous for the landlord than a lease. At least with a lease you have a written agreement and can point out in court exactly how it has been violated; with a month-to-month or oral agreement, it’s basically the tenant’s word against yours – and landlord-tenant court is totally biased in favor of the tenant. Using a broker is a good idea – it’s his or her job to weed out the bad applicants (while not violating any fair housing laws, something owners often inadvertently do) and find the good ones. Just having a tenant who can afford to pay a broker’s fee is often a good sign. Also, the broker’s “gut” is often more sensitive than that of an inexperienced landlord. And in the end, of course, the final approval remains with you, but you cut out a lot of the headaches and weirdo Craigslist responders in the meantime.

    16. Whether you have a lease or not, you need to follow a very specific process in NYC to evict a tenant who will not vacate willingly. In my opinion, it’s delusional to believe that having NO lease will make that process easier or cheaper. I can’t imagine a good and creditworthy tenant taking all the time and trouble to move into an apartment without assurance of a specific length of rental. Common forms of Blumberg leases can be found at local stationery stores, and both REBNY and Blumberg forms can be found online:
      REBNY: http://bit.ly/ftRmSK
      Blumberg: http://bit.ly/dNbViC
      This is a dated article you can read to consider the pros and cons of having a lease: http://nyti.ms/ew5rZM

      We’re rather old-school when it comes to credit reports, which were not used or expected “back in the day.” Yes, these days we look at the credit report, but we do not rely on them for final determination. If you’re worried about a tenant’s creditworthiness, renting through a broker will automatically eliminate many applicants. We require first, last and one month’s security from all our tenants.

      You mention paperwork, but you do not mention checking their previous addresses, or speaking to their previous landlords. Neither of those provide a guarantee, as there are many praying-to-be-ex-landlords who will gladly misrepresent a tenant just to get rid of them. In NYC, there are certain questions or exclusions that are prohibited under fair housing law. You can read more about that here: http://bit.ly/fzdGZ7

      Honestly, my gut feeling from this post and your previous posts is that you’d do better working with a broker. Nevertheless, here are some questions we often cover in our very informal interview, though rarely do we ask them as a series of questions:
      — Place of current employment
      — Length of employment
      — Hours of work
      — Tenant’s primary sources of income?
      — Total amount of household income?
      — Time of day tenant generally awakes and goes to sleep
      — Social Security number
      — Name of bank
      — Number of vehicles
      — Whether tenant has ever had their own apartment before
      — Name, address and phone number of current and prior landlords
      — Tenant’s own current address
      — Why tenant left (or is leaving) their previous residence?
      — Who else will be living full-time in the apartment? Part-time?
      — Did tenant get along well with the landlord and other tenants in their building?
      — What tenant likes about this apartment? What they don’t like?
      — How applicant found out about this rental?
      — Has tenant ever been a fire victim? If yes, please explain.
      — Has tenant ever been evicted? If yes, please explain.
      — Has tenant ever been convicted of any crime? If yes, please explain.
      — What would tenant do if a neighbor was using or selling drugs, or tenant witnessed any other crime?
      — What would tenant do if a neighbor was creating a disturbance in the building?
      — What is tenant’s relationship to the people they’ve listed as references?
      — Has tenant ever been involved in a community group or done volunteer work? Any special hobbies or interests?
      — Also, questions about use of apartment by friends and out-of-town family, pets, music (including any instruments owned), parties, smoking, bedbugs, etc.

    17. Regarding your month-to-month idea, the problem is that non-payers will not leave any sooner just because there is no lease. You must avoid non-payers moving in in the first place.

    18. 10 minute walk to Nostrand A and about 8 minute walk to Kingston/Throop C. Rent breakout is above.

    19. Sounds lovely! Wish we could live there.

      At least try Craigslist. Screen on phone or email somewhat in advance. I think a broker is only useful if you’re not in the area. Their motivation is to rent the place as quickly as possible. They don’t take the care you would. As a renter, I’ve been horrified by some of them, who I know for a fact did not check my references, but told the landlord they did.

      What subway stop are you near, how many bedrooms, and what is the rent?

    20. “how does one navigate around that – get an extra month’s security if credit score is below xxx, do a 6-month lease that is renewable if rent is paid on time?”

      if i was looking for an apartment – and a landlord was only offering a 6 month lease and asking for an extra month of security i’d run the other way.

      how much rent are you asking? sounds like a very nice place in a good location. surprising you can’t find qualified tenants.

    21. Vinca – more4less is considering the possibility of doing a month to month lease with his/her tenants as a means of being able to get rid of any bad or non-paying tenants.

      I’ve met a few really lovely people, have a nice conversation, think they would be nice as neighbors in our building and then we see the paperwork – multiple addresses and / or jobs over the past year, horrible credit, etc.

      I’m wondering what the red-flags are for avoiding those that know how to work the system and live rent-free. Also, with DIBS point about people generally not having good credit in our neigborhood, how does one navigate around that – get an extra month’s security if credit score is below xxx, do a 6-month lease that is renewable if rent is paid on time? Trying to figure out how to protect ourselves from renting to the wrong people.

      Thanks again, everyone.

    22. OP: Your query is not clear to me. Do you ask each potential tenant to complete a rental application? Do you sit down in person with each applicant and discuss the same set of questions? What do the questions cover? Where in the interview/application process do YOU get stuck?
      On the suggestion of having no lease—a bad idea, in my opinion. The lease is a contract between you and tenant; the lease protects BOTH of you.

    23. Thanks everyone for the comments.

      More4less – I am interested in hearing people’s opinions on your thoughts. I agree that it would offer some sort of safety net for us, the landlords, however, as a former tenant myself, I may feel like I would be waiting for the rug to be pulled our from under me should someone offer more money. After all, we would only be making a 30-day commitment.

      Rh – the apartment is very nice, in my opinion. Granite countertops, undermount sink, SS appliances including dishwasher and over the range microwave with fan, some custom cabinetry in the kitchen. Huge bath with orignial claw foot tub, linen closet, tons of closet space, original parquet floors and very high-end finishing details from Waterworks, Gracious Home, etc. About 950 sf.

      When do other landlords up the security deposit from one month to two when applicants have poor credit? Wondering if we should explore that option.

    24. bobjbkln, why would it make a difference what is rented out? I imagine that in any rental you would want people who pay on time and treat the property and the neighbors with respect.

    25. Agree with DIBS on the credit scores. None of my tenants had good credit and it has never been a problem for me (knock wood). I’m not saying it shouldn’t be an issue, but I would not overlook someone who was honest about hitting a rough patch in the past if they have their act together now.

      What is the apartment like? Is it nice enough for quality people to live there? Maybe you need to advertise it and forget your word of mouth. Just take some nice pictures and throw it up there on Craigs.

    26. I’m about to mkt an aptmt for rent and have some early concerns similar to yours and one of the things I am contemplating (if I dont find tenants that I’m very comfortable with) is to not offer them a lease and just go month-month. Am thinking that no lease would make it easier to boot the tenant if it doesnt work out. And rarely does it worth landlord’s while to suit to enforce the lease if tenant decides to leave before term is up.

    27. Credit scores can oftentimes be misleading. When I rented my unit I had my lawyer do the checks. I believe my tenants had a credit score in the 500s and the other might have been sightly higher. My lawyer made the comment that “in that neighborhood” you might not find higher scores and pointed out that the problem was primarily that they were late on student loan payments a few years back.

      Job reference was good and they were a nice couple. Since then never had any problem whatsoever and they turned out to be ideal tenants, so mucg so that I cut their rent in the third year.

    28. It’s been dreadful. We’ve only gone on word of mirth referrals but credit has been bad, under 600.

      Is it better to go with a broker to weed out the losers?

      We had someone here the other day who has had 3 addresses is 5 months and poor credit? I felt very uneasy about him after he sent application docs even though he was lovely in person.

    29. How has your experience been looking for working people with good credit and good references? Or students with a guarantor?

    30. The first thing to look for, after finances and such, is are those people good fit for you an your family? Another think we always look for in our tenants is are they genuanly nice people? Good-manners count for a lot when you live with these people in the same house and have to provide services to them and they might have their own ideas about what they should get from you. It’s much easier to deal with nice people and good manners take the edge off in many situations.

    31. credit check!!, employment verification, personal references (just to see if they have any), and the bottom line is to kind of “go with your gut feelings”- draw up an application form to get the basic info you want

    32. You didn’t say whether this was a two family investment property (or two investment condos) or two units in a three-family home in which you live. The answer might be different for these cases.

    33. – Look for people who have steady employment, rather than a short period of time work history. A friends asks for a letter from their place of employment with salary, position and period of time at the place.

      – Check their name on Facebook or on the blogs (search through google blogs)….Most of the people renting our friends place came up on these searches.

      – Google their current address – that has been very telling for our friend as well.