Landlords, who are your tenants?
Landlords, where do you stand on choosing a tenant in these difficult financial times?
How do you separate the dead-beats from the struggling workers? Where do you draw the line on who is too much of a financial risk? Would you rent to a new college graduate who has no work experience and a new job? How about someone who is deep in credit card debt? How about someone who was bankrupt? Foreclosed upon? Out of work for six months last year? These are troubled times; how much of their problems are you willing to take on? Do you ask for first and last month’s rent, plus security to protect yourself?
Many landlords advertize in public sources like on-line lists, newspapers, and network sites. Most of the time, the would-be tenant is a stranger. If you don’t know the person how do you choose? Because of fair housing standards, it is important to treat everyone the same. So, no matter who comes through the door, good landlords ask the same questions, get the same background checks and ask for the same deposits. Once you make a rule, you need to stick to it or risk being accused of discrimination.
If you have been reading my blog for a while, you know that I am a landlord. You’d also know that I come from a working class background. When I look at would-be tenants, I think of myself just after college or my father around 1964 when I judge the financial integrity of my tenant applicants. Where do I draw the line? Accuracy. If the person applying represents him/herself accurately and there is evidence that the rent can be paid on time, I am satisfied.
Here are two application stories:
S. was working and going to school part time. When she applied, she had gone bankrupt and was rebuilding her economic stability. The year before, she was buried in credit card debt. How did it happen? She cut back on work in order to help her mother get through an illness. She did not realize until it was too late, that she was under a huge 25+ percent debt. She told us about this before we ran her credit check. We were invited to speak to her credit counselor. She showed us her recovery plan. It all checked out. We took her on, risk and all.
Another time, an applicant didn’t say anything about being in trouble. He gave us his former landlord, his former employer, and permission to do a credit check. He didn’t live where he said he lived; his landlord reference didn’t own any property; he didn’t work where he said he worked. There were a string of judgments against him for unpaid utility bills. Dumb and a dead-beat; he can live somewhere else.
Landlords, was I just lucky to not get burned by considering tenants who are on the edge? Who do you rent to? How do you screen them?
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Truth is, with Massachusetts laws protecting tenants the way they are, you can't really afford to rent to people on the edge, since you can't get them out if they don't pay. And neither your bank, the city, nor the state will take that as an excuse when they hit you with their bills.
So its the paradox of tenant protection laws. You are playing with fire in this state if you don't rent to people with ironclad guarantees of paying their bills. ie well off people with good jobs.
I have had good renter and bad, the last renter cost me $10,000 in repair and back rent before I got them out. I now rent to my son, when he gets his own place i will only rent to someone i know or a friend of a friend or leave the place empty.
There are two things my wife and I always did and we seemed to have good tenants in our properties - first, we bought investment properties in good, safe areas with plenty of young professionals. This is obviously a generalization, but you buy in most parts of Lawrence, Brockton, Fall River, Everett, etc - you're going to get what you pay for. The people who want to rent in those areas are probably, by and large, less likely to be good credit risks to begin with.
Second, we ended up renting to mostly young, single asian women. We didn't really plan it that way, but those were the people who seemed to gravitate towards the areas where we purchased and I can say that we never had any problems with late rents - and we never got calls that our place had been completely trashed in the midst of a booze-fueled bender. I would never not rent to someone because they either were or were not a certain race or gender, but we just happened to have good luck with what we got. Sure, we also did our homework on credit checks, etc, but a lot of it is also common sense. The better the area you buy into, the more likely you are to attract a credit-worthy applicant. The crummier an area you buy into, the more likely you are to run into trouble.
My parents rented out properties on the Cape to year round renters when I was younger and all they got was headaches for their trouble. I could go on and on with horror stories of houses trashed, no rents coming in, etc - but again, what do you expect? Particularly at that time when there were far fewer year rounders down the Cape, you're mostly going to attract vagrants masquerading as tenants. All of which is just another way of saying - think hard BEFORE you buy a property in the first place about what kind of tenant you are likely to attract and it will save you a lot of grief.
se.
I've got to echo the previous posters. Massachusetts law is so very hostile to landlords (especially small "mom and pop" landlords), that a landlord cannot afford to take anyone who cannot guarantee timely rental payments and no damage. Many LLs are opting to keep their properties empty because no tenant is better than a bad one - or even one who just can't make rent. Add into the mix the ridiculous inspection standards (like flunking inspection because the grass was too long!) and you have a recipe for disaster for tenants and LLs. Massachusetts has passed numerous laws and instituted numerous processes that apply to all LLs rather than going after the few real slumlords. When you remember that small LLs provide the bulk of rental housing in this state and that they provide the most affordable rental housing in this state, this creates a serious problem for both LLs and tenants.
I run a full credit check, criminal background check and public records check on all applicants and have a checklist of requirements for all applicants. A lie gets you bounced immediately. As the first posters have said, Mass law is so crazy that one has to be incredibly careful with who you rent to. You can lose thousands of dollars in rent and many more in property damage if you choose the wrong tenant and especially if you pick a "professional tenant" a tenant who makes a career out of scamming landlords. Many small landlords have been literally destroyed by such tenants.
I am a landlord, in Waltham, and have been renting apartments (currently about 30 units) for twenty-five years. I have had mostly good luck with tenants, primarily renting to professionals.
I have had a few bad renters in those twenty-five years (two formal evictions and a couple of informal - basically get out on your own or I will start formal eviction proceedings).
I meet and speak with all of my prospect tenants. I use an application and check references, specifically current job and current landlord. My decision is based on a 'gut feel' about the tenant during our initial conversation and the checking of the referneces. If the prospective tenant has had several different jobs, several different landlords during the last couple of years, and drives an older/junk car, then I will not rent to them.
20+ years NO MERCY
from the state
from the banks
from the tenants
from the lawers
from friends
from family
.........
you are the landlord you deserve nothing but pain
So no landlords eager for the miscreant foreclosees? But we need them out of their homes so the market can correct itself!
Two family house here. It cost me six months rent and moving expenses to get rid of my last tenants. It took me two months to clean all that they left (a small room contained cat waste covering one entire end of the room; used condoms were in every room, including the top shelf of the kitchen cupboard). The rental unit has been off the market ever since they moved out. It's not worth the aggravation; I'll take the loss on my income tax instead. Deck is stacked against the small landlord in the Commonwealth of Massachusetts, so I will never rent again ... never.
Massachusetts has passed numerous laws and instituted numerous processes that apply to all LLs rather than going after the few real slumlords
You know, this is really the rub. It's not just about the rules of combat. It's also about the battlefield you're stuck with.
MA courts are completely incompetent at dealing with landlord/tenant issues. They can take years to act. Their rulings are often idiotic. Neither good tenants nor good landlords are protected. The only beneficiaries are slumlords and deadbeats, who, after all simply want delay, which is the one thing this court system can efficiently provide.
I would like to be able to take a chance with people trying to rebuild their lives, but the State of Massachusetts and especially the City of Boston, make that impossible. The lack of rent escrow and the presence of many anti-landlord laws mean that you can't take any risks at all, especially if you're a small landlord or owner-occupant. It's a shame because the city estimates that over 2,000 units (mostly in owner-occupied homes) are being left vacant because of the draconian laws here.
My past dealings with bad tenants have been when I didn't follow threw with the reference check and the "GUT FEELING CHECK" doing your homework it helps!!!!!
Don't get lazy about it!!
I own a 3 family in the Bristol County area and have had nothing but bad luck dealing with tenants not paying. Why is it that if I took your wallet right out of your hand it's criminal but these renters who don't pay are not criminals? Our justice system is a joke. I am going through the process of eviction with one of my tenants and it has already cost me back rent, damages, paying court costs, etc. How do landlords like myself recoup these losses if the courts are not willing to put their foot down on such deadbeats.
All I can say is to act immediately when you do get a trouble tenant.... Leniency only shows tenants that you are soft and that they know they can get away with stuff and will take advantage of you! 10 years of experience and learning the same lesson over and over for me... If they are late, send a notice to quit immediately.
I am a landlord in Dorchester in a good area near Neponset in a owner occupied two family home. I do complete reference checks but haven't been doing credit checks. I will now, with the economy the way it is. I usually go by length of employment and good past references from landlords. Any one who provides incomplete or inaccurate info. is immediately out of consideration. I always ask for 1st, last and security deposit (at least a half month). I've never gone without being paid but have evicted a tenant (1 in 9 years). I think ower-occupied makes a difference. I have to live with the person(s) I rent to. I give them an opportunity to get a sense of who I am and how I like to live and the same for me. If it doesn't feel like a "good fit" no matter how good they look "on paper", then I don't rent. Also, I am vigiliant about making sure they are clean and taking care of the property. I have Never entered the unit without permission but there are common areas and I make sure they are clean and orderly. Any smallest hint they may be destructive and I will be proactive. I'm not going to let someone tear up my property.
As a Boston Landlord, I want to very clear that I (and the rest of the landlords on this blog, I believe) are not objecting to anti-discrimination statutes. What we object to is a process that treats all landlords like slumlords, treats all tenants as saints and takes forever to act. If we could have prompt evictions, rent-escrowing, fewer restrictions on security deposits, collections on judgments, etc. we could afford to take a chance with someone with a less than stellar record.
If someone broke into my home and stole $1000, they'd be considered a criminal, but when a tenant does that by failing to pay rent, somehow it's not seen as criminal. Also, the notion that landlords should extend charity to tenants in need is foolish given that landlords get no assistance from anyone to support that charity.
Based on these comments, I feel like I should have asked for a discount when I was a renter. I went out of my way to be a good renter. Shoveled the walk, cleaned up the entranceway, did small repair jobs, got the rent in early, etc.
I used to get so pissed when landlords asked for references and credit checks.
I do believe that you your first impressions upon meeting someone can tell you almost as much as a background check and references. Based on my experiences hiring tons of people at my job.
I have enjoyed reading the other poster's comments. I could tell you some unbelievable stories, but that is what the landlord meetings are for. I suggest that you learn from others (it’s less expensive). Being a landlord in Massachusetts for over 26 years, I continually thank God that I learned how to be a landlord in the worst, most anti-landlord, pro-tenant state (Massachusetts) and in the worst city (Brockton). The reason is that as I acquire properties anywhere else in this state and others, I don't have any tenant problems. I learned how to deal with the worst tenants, in the worst city, in the worst state. Everything everywhere else is easy. The fifth posting above from Ritar 1 indicates that he has also figured out how to prescreen and work with tenants and how to enjoy being a landlord in this state. From what he is doing, he is probably a previous student of mine. If you learn the rules here in this state, in one of the (tougher) cities that J.P. mentions above you will become educated quickly, or you can follow J.P.s good advice and steer clear of those problem areas. Also check out the comments from another long term landlord Frederik Winsser. He has overcome the same problems with his units. Good comments, but don’t be afraid of being a landlord in Massachusetts. Thanks to Rona Fischman for the original article…you hit a great topic.
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