Is this a red flag?

[TerryF]

We are advertising a house for rent in Calgary on Kijiji. We`ve turned away a few already because of too many pets and/or too many people/too many children, etc. But we are considering renting to a couple with no children but they have 2 declawed middle aged cats. We aren`t too concerned about that but what is weird is they would like a lease for at least a year and hopefully more and want to prepay 6 months of it. I asked why they would want to do that and they said to just get it out of their hair early. This is pretty odd to me but maybe it`s common ??

We haven`t got their completed applications yet but we know the man has his own company doing home renovations.

They have said before we even asked that they would do lawn care etc. (who offers that upfront??) as they have their own lawn mower.

They love the fact (unlike most) that the house backs onto a high berm and on the other side is Deerfoot Trail as it is very Feng Shui to back onto a busy street.

Something doesn`t quite feel right to me but I don`t know why. Any ideas from any of you who do lots of rentals? What`s your hunch? Am I being paranoid or is there something fishy about these people?

Terry

 

[NeilUttamsingh]

QUOTE (TerryF @ Jul 26 2009, 09:42 PM) Something doesn`t quite feel right to me but I don`t know why...


Terry,

You have to listen to what you gut feeling is telling you. If you do not have a good feeling about these people from the start, you cannot ignore this feeling.

The proof will be in the pudding here. Ask these prospects lots of questions, re-ask them the same questions, phrase them differently, and see if you get the same answer. If you are suspect of them, see if you can catch them in a lie.

Also, exercise extreme due diligence with your reference checks, don`t skip a step.

Never go against what your gut tells you.

I was recently put through the `ringer` with a lot of suspect applicants in Hamilton, ON. I had to really dig deep, and fight my way through a lot of their BS.

I was glad that I did because I was able to find the `perfect` tenants.

Terry, dig deep and listen to your gut.

Your gut will not lead you astray.

Regards,
Neil.

 

[orei]

I have had a tenant prepay 8 months worth of rent - but he did not inform me until after I had already screened him as a tenant. I cannot understand why, but just assumed that he must have been terrible at budgeting. Everything worked out fine, and he is still with me, although he is now paying every month

.

Remember to screen the tenant on the fundamentals....

 

[Ready4Rent]

I have had tenants pre-pay 3 months, 6 months, 8 months, even 1 year. While you cannot ask for that amount, if they want to.. take it.

However, I agree that some-one that says they will pay 6 months or whatever upfront does require an extra layer of screening.

 

[invst4profit]

Unfortunately when something sounds too good to be true it often is. I would be very diligent in screening this applicant especially in regards to previous LLs.
If the applicant was not able to provide the names of two previous LL that I could certify were reliable I would definitely not rent to them.
The guy sounds like he is either desperate or hiding something either way definitely suspect.

 

[RedlineBrett]

They are prepaying because they are contractors and will not have consistent income. They have the money now and so they want to give it to you before they spend it themselves. Not the most promising sign in my opinion - shows they might have trouble managing their cash flow. Who would do this if they were on top of things?

We had a similar tenant give us an advance payment and that`s all the money we ever saw from him.

May work out fine who knows... But I always get nervous with trades people. Almost all of our problem tenants have been trades or contractors of some type.

 

[CalvinPeters]

I had a tenant pre-pay a year...single young mother with one child, seperated and had a bunch of money from that, credit check proved she wasnt good with budgeting, I figured that was fine as long as the check cleared...it did. Turns out she them thought of me as a bank and was always harrassing me for money back when the rest of the money ran out, eventually calling a lawyer and trying to break her lease etc. etc. Fortunatly I was able to re-lease the home with no loss of income, and she got her money back. Lesson learned. If they are bad at budgeting, they will try and prepay...but make sure they dont try and get the money back. (have them sign something) So make sure you dont go against your process, even it they have cash and as was already mentioned, dont go against your gut instinct.

Good Luck!

(Interesting side note: HER Lawyer was so impressed with how I handled his client that after all was said and done he contacted me and tried to hire me to manage HIS rentals! I of course said no, but was flattered!)

 

[dplummer]

Check them out carefully. Sometimes grow op operators offer to pay up front & cut grass to keep the owner away from the property.

Doug

 

[Thomas Beyer]

QUOTE (dplummer @ Jul 27 2009, 09:12 AM) Check them out carefully. Sometimes grow op operators offer to pay up front & cut grass to keep the owner away from the property.

Doug
possibly .. but could be OK .. check him out first .. references from a previous landlord !

First question to ask this "landlord" is : "I`d like to rent a suite .. what do you have available" .. w/o your name .. as this may trip up any buddy he has to pose as a landlord. Do not ask " What can you tell me about Mr. & Mrs. XYZ .."

Are you close to this property ?

tell him that you will come by AND INTO THE PROPERTY weekly for the first 2 month .. then every month .. give him a 24h notice each time ..

Since you now have 6 month of payment, with a good lease and an eviction firm you coudl get rid of them if s.th. fishy is going on ..

 

[NickDavis]

QUOTE (thomasbeyer2000 @ Jul 27 2009, 12:34 PM) First question to ask this "landlord" is : "I`d like to rent a suite .. what do you have available" .. w/o your name .. as this may trip up any buddy he has to pose as a landlord. Do not ask " What can you tell me about Mr. & Mrs. XYZ .."

I love this! I have always wondered how to make sure the tenant isn`t using a fake reference! Thanks as always Thomas, I am going to be an expert in Real Estate Investing before I buy my first property!

Nick

 

[TerryF]

Okay and thanks everyone!! My vague suspicions are less vague now. I agree with almost all the posts. I think the income is unpredictable and I also think they want us to disappear after we hand over the keys. Maybe to conduct some illegal activity. Backing onto a busy street is not great but better than nosy neighbors. Never thought about the hassle if they want some money back either!

So I emailed them our `rent application` form that asks a lot of information, including previous 2 landlords, and the authorization to do a credit check. Haven`t heard a word back from them and they were keen enough until then to bring over the money last night! The credit check request does scare off a lot of the risky applicants which is exactly why we get this filled out and returned before we even let them see the place.

Terry