How to decide between two great potential tenants

All landlords dream about finding that perfect tenant. But what happens when you find two?

It might sound like a pipe dream, but there are lots of good quality renters out there, and if you find yourself in the company of more than one tenant who makes a good first impression, has a stable monthly income, and passes the tenant screening process with flying colors, it can be difficult to decide which one should get the keys and the lease.

What you don’t want to do is let your personal biases become discriminatory, thereby violating Fair Housing laws. The first thing to do is to compare their tenant screening reports side by side and see whether one rises to the top based on cold hard facts (including the credit rating and background check). If not, think about other factors, like the stability of their respective employers, the length of time they’ve worked there, and how long you expect them to live there.

Make the decision based on who is the better risk, not on which one you think you like better or which one you are personally more comfortable with. And when you think you’ve made your decision, justify it to yourself on paper so that you are sure there are no illegal biases at play. 

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Renting During a Recession Means Making Concessions

Every landlord hopes for a dream tenant to walk through the door, someone who’s friendly and clean with excellent credit, solid employment, good references and no criminal record. While these tenants do exist, it’s getting harder to find renters with spotless credit reports and an unblemished employment history. These last few years of layoffs and pay cuts have wreaked havoc on families across the country, and plenty of upstanding citizens, many who’ve owned their own home before, are facing hard times.

Landlords can’t become bleeding hearts, opening their doors to every victim of the recession. It’s still important to do a thorough tenant screening on applicants and think long and hard about the risks associated with allowing someone to sign a lease. But if the potential tenants you’ve been screening have lower credit scores than what you’re used to accepting, consider a few things:

1. Don’t make a foreclosure a deal breaker. The number of people who have a mortgage in foreclosure or mortgage payments significantly past due is rising. While those people couldn’t hang onto their homes, they more than likely are good prospects for renting because they’re used to caring for and maintaining a home, and they’re determined to improve their financial situation, which means they’ll pay their rent on time.
2. Reduce the security deposit but make it nonrefundable. Reducing the security deposit gives a break to those who will probably be good tenants but don’t have a lot of cash lying around to drop all at once. And making the security deposit non-refundable helps alleviate some of your risk in renting to someone with a lower credit rating.

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