Mr. Doe’s first investment property was ready to rent. He placed the ads all over the social media, put a sign in the yard, and found a website that allowed him to download a set of prepared blank rental forms for a small fee. His house was a nice single-family home with a yard, located in a quiet cul-de-sac, so he had no trouble attracting potential renters, even with the rent price set at the higher point of the going market rate.
What Mr. Doe had trouble with was figuring out is which of the applicants he wanted to rent to. He finally narrowed it down to three potentials: a young family with a little child, an older couple with no children, and a single man who was moving into the area because he was recently hired by a local corporation. Every candidate’s paperwork looked very good, but the young professional moving into the neighborhood for his new career looked the most stable financially. He also had the highest credit rating. There was just something about him that made Mr. Doe feel uneasy. His paperwork file looked good – almost too good.
Feeling a little embarrassed at the fact that he could not complete the whole transaction on his own, Mr. Doe called a Realtor. As the brokerage did its due diligence and re-checked the potential tenants’ credit reports, it turned out that there was a good reason Mr. Doe was feeling uneasy: the young professional’s paperwork was forged. The real credit score was below 600, with a recent bankruptcy and several other negative factors affecting the report!
A few minutes of surprise and anger later, the property was rented to one of the other potentials, and Mr. Doe breathed a sigh of relief – he avoided doing business with a tenant who would most likely not live up to his side of the contract obligations and potentially would have to be evicted… as much as most landlords realize that an occasional eviction may have to happen in the course of their business, no one wants to deal with that on their very first rental deal.
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The take-away: When you rent out your home (or an investment property), you are trusting another person (or people) with one of your most valuable possessions. Hiring a professional to help you with the vetting process and having a clear set of standards that you expect all potential tenants to follow can help you avoid future pain.
Marina Alkasas | Realtor® | Cal DRE License # 02070557 | Century 21 CARE
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