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Tenants Do's and Do Not's!
Omaha home rentals, Omaha rental homes, houses for rent, rental homes, rental houses, apartments, condos, townshomes, mobil homes, tenants and landlords...
You’ve made the decision to move. You begin looking through the newspapers and apartment guides for available rentals. Find the place you want, fill out an application, put the deposit down, and live happily ever after. It seems simple enough. Often times, this is the case, however, what if the rental market is tight or you have credit issues that could hinder your success?
Most people have a reasonable amount of time before they decide to move and actually moving. Before your pain-staking search for a home or apartment to rent, take advantage of this time to prepare. Keep in mind, renting and leasing property are business transactions. When buying a car, you take the opportunity to research the vehicle before buying it? You go to the bank to get the loan and ensure the vehicle is worth what you’re paying for it. Renting property is no different.
Here are a few specific things you can do prior to your rental hunting adventure.
Check your credit by ordering a credit report. There are several venues from which you can obtain your credit report. You can order your credit report over the Internet from one of the major, national credit reporting agencies such as Experian or Equifax. In fact, the experts recommend you obtain a copy of your credit report once a year. This ensures there are no inaccuracies, or you have not been a victim of fraud. You may obtain your credit report from one of the 3-major consumer reporting agencies at:
Experian (888) 397-3742 (www.experian.com)
Equifax (800) 685-1111 (www.equifax.com)
Trans Union (800) 916-8800 (www.tuc.com)
Why? Most landlords put a lot of emphasis on the applicant’s credit history. If your credit is legitimately bad, they’ll consider you a bad, prospective tenant. If your credit history is good, but unbeknownst to you, there are errors on your credit report, your prospective landlord will still see you as a bad prospective tenant.
By ordering your credit report ahead of time, you can correct any errors that may exist on your report or correct any legitimate credit issues prior to your home search. If you have credit issues that aren’t easily correctable, at least, you are aware of what’s on the report. When it comes time to apply for a home or apartment to rent, you can inform the landlord about your specific situation prior to him ordering the report. This gives you an opportunity to give your side of the story insofar as the specifics of your bad credit. Your prospective landlord might evaluate your honesty when considering your application.
When a landlord evaluates a credit report, many will classify bad credit as “good” bad credit and “bad” bad credit. “Good” bad credit is those credit issues, which were not done intentionally. For example, you had a serious illness, and you were unable to pay your medical bills. Eventually, the hospital and doctors bills were referred to a credit collection agency.
Obviously, you didn’t intentionally go out and run up medical bills. They just became overwhelming, and you were unable to pay them. This may also apply if you were forced to file bankruptcy because of those medical bills.
“Bad” bad credit is where you go out and apply for 5-credit cards, charge them to their limit, and quit making your payments. You made a conscious decision to over-extend yourself with credit then decided, or you were unable, to make your payments. Remember when landlords rent a home or apartment, they are actually extending credit to you. That’s why your credit history is so important to the overall process.
The problem with most credit reports is they don’t distinguish between the two. Therefore, landlords may not honestly know your specific situation. All they can deduct from the credit report is a history of credit, whether good or bad. Now you have an opportunity to let your prospective landlord know ahead of time of your specific situation and ask him for special consideration.
More and more landlords across the country are requiring applicants to consent to a criminal background check. Primarily, this is a result of the increase in drug dealing and tenant safety concerns. If a tenant is arrested for dealing drugs out of the house, the owner may face the possibility of losing the house to the government.
Likewise, with the increase of violent crimes, particularly against women, owners want to ensure they aren’t renting to someone convicted of rape, a violent crime, or other criminal act. Landlords can be held to a high standard of liability if the person they rented a dwelling to is involved in a criminal act against you or another resident.
For example, a landlord rents an apartment to a convicted rapist, and he failed to obtain a criminal record check on his tenant. After the tenant moves in, he commits a criminal act against the neighbor. By failing to check the tenant’s criminal history, the victim could claim that the landlord failed to properly provide a safe environment. The neighbor could sue the landlord, resulting in thousands of dollars in judgments and attorney fees.
As a practical matter, you shouldn’t be offended if a landlord requires a criminal record check. If he requires it of you, he probably requires it for every applicant. That should give you added comfort knowing your neighbors aren’t convicted rapists or sex offenders.
So what are you to do if you were convicted of a crime and your prospective landlord requires you to consent to a criminal background check? You have a few options available. First, you can consent to the background check. If you were convicted of a crime, you might consider explaining your specific situation to your prospective landlord. Just as people with bad credit give a pre-emptive strike, you might choose the same course of action.
Second, refuse to give your consent for the background check. In doing so, chances are your prospective landlord will disqualify you as an applicant.
What Should I Expect to Pay?
Believe it or not, I’ve had applicants who didn’t have a penny to their name, yet they tried to rent my rental property. You should expect to pay the first month’s rent and a security deposit. The security deposit can’t exceed the first month’s rent. In Nebraska it’s illegal for a landlord to require the first and last months’ rent plus a security deposit. We’ll discuss this in detail later in the book.
You’ll probably have to pay for the application fee or the credit report. Generally speaking, the application fee will include the costs associated with obtaining your credit report. The application fee is usually more than the actual cost of the credit report. Many landlords keep the additional money as compensation for verifying other information on your application.
These fees can range from $10-$35 depending on the local area and which reporting agency the landlord uses. Likewise, you’ll probably be required to pay for fees associated with any criminal background checks that may be required. Finally, depending on your credit, you may be required to pay for utility deposits.
Depending on the local rental market, you may find it difficult to find a place to rent if you own pets. It may seem unfair or ridiculous that owners won’t allow pets, but look at this from the owner’s perspective. Pets can take an extremely high toll on a rental property. A cat urinating on a carpet can totally destroy it, the padding, and even the floor. Keep in mind, most landlords don’t make a lot of money every month from rent. Usually, they have a mortgage payment, insurance, taxes, utilities, and management fees to pay. There is not much profit left over. Replacing the carpet every year or two would make the rental business a losing business.
Having said that, however, if the market is “soft,” many property owners are more than willing to accept pets. In a “tight” market, owners are less likely to accept pets. The bottom line is owners are not required to accept pets. If you own pets, no doubt you know how difficult it is find a place to rent.
As with any application, your prospective landlord will probably ask for references. Often times, they will ask for current and former employers, personal references, and next of kin. It’s helpful to have all this information ready and immediately available. I suggest having all your references neatly typed on a sheet of paper, which you can submit with any rental application. Make sure you include names, addresses, telephone numbers, and the best time to reach your references.
I Want This House! Now What?
Now that you’ve found the home or apartment you want, you’ll probably have to compete with other applicants to get it. There is nothing more frustrating than losing the home to someone else, especially if you’re a worthy applicant. The good news is you don’t have to. The best way to ensure your name is at the top of the list is by being prepared.
Totally and completely fill out all the requested information on the rental application. As a landlord, there is nothing more frustrating than trying to track down information from an applicant. Many times, if an application hasn’t been completely filled out, the landlord will put the application at the bottom of the pile. It’s very time consuming to try and track down an applicant for additional information. When you give the rental application to the landlord, include a written list of references.
As we’ll discuss later in the book, when it comes time to sign the paper work, REVIEW ALL DOCUMENTS before signing them. Make the landlord explain each provision of the rental agreement. If you don’t understand or feel uncomfortable about something, have an attorney review it first.
If you’ve practiced what I suggested in the paragraphs above, your prospective landlord will see you as an excellent potential tenant. Chances are the landlord won’t select someone else over you just because you want someone to look at the documents first. Why? Because you were prepared! If the landlord discourages you from having the rental agreement reviewed by an attorney, that should be a red flag, possibly indicating the landlord may have a hidden reason why he doesn’t want you to have it reviewed.
The Rental Process…Your Landlord’s Pre-qualification Process
Most landlords have some process for pre-qualifying interested applicants. The process helps the landlord eliminate unqualified prospects prior to investing time and gas in showing them the property. The pre-qualification process not only benefits the landlord but likewise the tenant. Looking for a place to rent is a time consuming adventure. Finding a tenant is likewise time consuming for the landlord. For example, you want to know if a landlord will accept pets. If you own pets, you don’t want to waste your time on landlords who won’t accept pets.
The next step is looking at the property. However, before actually meeting the landlord at the property, he may ask you some pre-qualifying questions. There is nothing wrong with a landlord asking legitimate pre-qualifying questions. A few questions I ask potential applicants are:
1. Are you willing and able to move into the property when it’s available?
2. Do you have pets (especially if I don’t allow pets)?
3. Are you willing to give up your pets?
4. Are you currently renting now?
5. Will your current landlord or property manager give you a letter of recommendation?
Why ask these questions? Basically, they are time savers. As a landlord, I can testify that tenants usually want to move in on their timetable. That means the landlord may lose potential rental income waiting for them to move in. It’s very common for tenants to have three or more weeks left on their current rental agreement and will want to start the new rental agreement after their current one expires.
Generally speaking, landlords can usually live with 1-week or so, however, anything more than that usually requires them to agree to start paying rent, or they’ll leave the property on the market for someone else.
Pets can be a real sticking point for both a landlord and tenant. During the pre-qualification process, if you indicate you currently have pets, chances are you are going to want to keep them. If your prospective landlord doesn’t accept pets, be proactive and suggest win-win proposals.
Remember that landlords have heard every reason imaginable why they should accept pets. “My pet is different than other person’s pets.” “It’s an outside dog.” “It’s house broken.” My personal favorite is, “it’s a small dog” only later to find out it’s a Great Dane.
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