What I Wish I Could Tell Prospective Tenants

I was conversing with a prospective tenant this morning. She reached out initially to ask if we would consider a candidate whose credit score is lower than the minimum credit score posted in our listing. I replied that we have made exceptions in the past and it really depends on what the credit score shows as to why it’s low. Bankruptcies, evictions, and poor payment history mean something totally different than age of credit, number of accounts open, or even amounts owed. Interestingly “payment history” and “amounts owed” each account for around 1/3 of one’s credit score, but someone who has paid everything on-time, yet has a $500 credit limit on a single card they opened last year and used it for a $400 car repair is going to get knocked for using 80% of their available credit. If that’s why someone’s credit score is low, I don’t count it. I actually look at that as a positive, especially if I can also see that they have sufficient liquid savings and income where that $400 repair isn’t going to take them down financially.

Pro Tip: If you have a low credit score for a silly reason—ask if you can use TransUnion’s SmartMove score instead. It’s a much better assessment of someone’s likelihood to be a good tenant than a traditional credit score.

Back to the story, the prospect went on to share that the issue was that she was currently in collections, but that she was on a payment plan and making on-time payments.

Hmmmm…I thought. Collections raises a yellow flag for me…but I might be willing to look at it if everything else indicates this person would be an excellent tenant, meaning she’ll pay on time, take care of the property, and be generally good to work with—let us in when repairs are needed, follow quiet hours, etc. But then she shot herself in the foot. She jumped into why no one (aka landlords) seems to care and that she gets denied right away on account of that. Ooo…another yellow flag right there. Can you spot it? She is making an appeal to my compassion. Do I care? Or am I just going to be another callous landlord who won’t consider her?

I gave her one final benefit-of-the-doubt. Maybe she doesn’t get it, I thought. It’s a tight housing market. She’s competing with other prospects who have better applications. Why would a landlord choose someone with a worse application over someone with a better application? That doesn’t seem fair. It’s not fair. The truth is, she has to answer this question for landlords. She has to show them why she should be considered, why she would be just as great a candidate, despite her collections. I told her this and gave her some practical ways to demonstrate it.

Her response? To list out the grievances of her past landlord and how she was a victim, finally ending with, “No one in life is perfect and it feels like we need to be in order to have a home.” Now the red flag is flown. The ship is sunk. For me, the credit score was not the main issue. That may have been workable depending on the other pieces of the story. But now? Not a chance. There is no indication of someone who is workable, takes responsibility, or cares for a property. Is it possible her previous landlord really was a jerk and that she was a victim? Yes, it’s possible. But then the “no one in life is perfect…” line sounds like she feels she had something to do with it, but is more interested in blame-shifting. It’s like going on a first date with someone and the first thing they launch into is how terrible their ex was and why the failed relationship wasn’t their fault. Might be true…but that’s a strange thing to lead off with.

Now if you’re thinking, “But Kelsey…aren’t you being a little hard on her? Do you know how hard it is to get your life back on track once you have collections or evictions in your history? What about survivors of domestic violence? How are they supposed to get a foothold if no one will give them a chance?” I hear you. It is a tough uphill battle once you get a derogatory mark like that on your record. But the derogatory mark is not what’s sinking her here. It’s making it more difficult, for sure. But let me illustrate how she might have overcome that. In fact, I’ll give you a real story of someone who came to me as a prospective tenant who had a worse credit story, but still passed. This prospect actually didn’t even choose our unit because she found a different one she liked better! She had options! Here’s how she handled her derogatory mark:

“Would you guys consider someone with an eviction from a few years back? I know it doesn’t look good and my credit score doesn’t meet your requirements. I went through a messy divorce and have been working really hard to get my life back on track. I have enough income to support the rent and can even pay first and last month’s rent upfront. You can also see that I’ve made all my payments on time the past 4 years. Would you be open to considering me?”

Yes, we would.

What’s the difference between these two prospects? What do I see in the second story that’s missing in the first? Attitude. Humility. Flexibility. The second prospect describes a difficult situation in her life without actually blaming someone else. She shows responsibility. She understands she might look higher risk than other candidates and by offering first and last month’s rent upfront, she’s showing me she’s willing to assume the cost of that risk herself rather than expect me to take it on. She’s willing to negotiate.

I would still check her income, tenant history and criminal background, but her softer skills are looking good. I would even lean towards a person who can demonstrate better soft skills than someone who has a high credit score, but is quick to blame others, is rigid in their expectations, or communicates poorly. A person who’s hard to work with is high risk.

The first candidate, on the other hand, scares me. She’s more interested in telling me why life is unfair than showing me why she should be considered or trying out the tools I gave her for overcoming her situation. “No one in life is perfect and it feels like you need to be to have a home.” Well, no, you don’t have to be perfect, but you do have to be work-with-able. It’s okay to be discouraged…but expressing discouragement in a way that makes everyone else out to be the problem is not a tactic that’s going to get you anywhere you want to go.

So for prospective tenants, consider the following questions a prospective landlord is likely to have when considering tenants:

-How likely will this candidate be to get evicted? Can I trust them to pay their rent consistently? Otherwise how am I supposed to pay the mortgage, insurance, property taxes, business expenses, repairs etc.?

-Will this candidate care for the property I’m entrusting to them? Or will they trash it and blame me for not doing their responsibilities for them?

-Will they let me know if there’s a repair issue that’s on me to cover so that more damage isn’t caused by negligence? (Had a tenant once who requested a repair for a leaky toilet, but every time we scheduled a repair guy to fix it, she would refuse to let him in if the time was no longer convenient for her. For over a month she refused to let anyone in to fix it. She always made on-time payments, but still got evicted because she wouldn’t allow us to maintain the property in accordance with the lease.)

-If they break or damage something, will they take on the responsibility and cost of repairing or replacing it? Or will they expect me to cover their damages?

-Are they easy to work with? For example, if there’s a noise complaint will they respond by changing their behavior? Or will they push the limit to see what they can get away with?

Can you see how many of these questions have to do with character?

Pro Tip: The worst thing you can do is signal entitlement.

Anyway, I could go on, but I have to get ready for the other showings this week. There’s already two strong candidates coming who have been really great to work with so far.