Tenant Screening - Ontario Works and Baby Bonus

[princecharles]

Hi all

My mother wants to rent out her basement to a 22 year old girl with a 3 year old child. She brought her mother with her to the screening and they both seemed really nice, and they are both locals who live in near neighborhoods.

The problem is that this tenant does not have a job. However she claims to receive $920 a month from Ontario Works (is this welfare? is it sustainable?) and $500 a month from baby bonus (is that much even possible?).

I have no idea how either of these work and am trying to read up on them.

So what do you guys think? Thumbs down? Thumbs up? If so what assurance should I ask for? Proof of income? Co-signer?

Thanks so much anything helps I have to give a reply by tomorrow!!

 

[Nir]

It depends on many factors not provided like can you find much "lower risk" tenant instead? how is the area? do you have to "compromise" on someone with no income in that area? vacancy rate in the area? rent amount you are asking? mom`s income (meaning child`s grandmother)? many more..

you will not get good specific advice without providing that info.

Feedback from her previous landlord would be best but I am assuming she was not a tenant before.

Unfortunately, based on the information provided it can work great with her or be a nightmare.

 

[NiagaraInvestor]

QUOTE (princecharles @ Jan 7 2010, 06:54 PM) Hi all

My mother wants to rent out her basement to a 22 year old girl with a 3 year old child. She brought her mother with her to the screening and they both seemed really nice, and they are both locals who live in near neighborhoods.

The problem is that this tenant does not have a job. However she claims to receive $920 a month from Ontario Works (is this welfare? is it sustainable?) and $500 a month from baby bonus (is that much even possible?).

I have no idea how either of these work and am trying to read up on them.

So what do you guys think? Thumbs down? Thumbs up? If so what assurance should I ask for? Proof of income? Co-signer?

Thanks so much anything helps I have to give a reply by tomorrow!!

The $500 a month baby bonus sounds like BS!   You should read up on what`s going on in Ontario.  once you do you won`t let your mother rent to this perspective tenant.  Check this website out.  Ontario is a tough place to be a small LL now...


http://www.ontariolandlord.ca/forum/

 

[princecharles]

QUOTE (NiagaraInvestor @ Jan 7 2010, 08:23 PM) The $500 a month baby bonus sounds like BS! You should read up on what`s going on in Ontario. once you do you won`t let your mother rent to this perspective tenant. Check this website out. Ontario is a tough place to be a small LL now...


http://www.ontariolandlord.ca/forum/

NI- I just checked and it seems $500 is the MAX baby bonus available.
Why is Ontario so bad? You just mean the rent ceilings? I don`t see anything on that forum in particular..

Investsmart - Yes sorry I should have provided more. In terms of the competition, it doesn`t get much better. But my mother is in no urgent need of cash either.

 

[housingrental]

Hi PrinceCharlers:

1) What is the rent of the unit

2) Does this includes utilities ? If extra apx how much?

3) Does the applicant have other obligations?

4) Is the applicant`s mother able to act as a guarantor and does she have sufficient funds to support the application?

 

[princecharles]

QUOTE (housingrental @ Jan 7 2010, 08:45 PM) Hi PrinceCharlers:

1) What is the rent of the unit

2) Does this includes utilities ? If extra apx how much?

3) Does the applicant have other obligations?

4) Is the applicant`s mother able to act as a guarantor and does she have sufficient funds to support the application?

Hi Housingrental thanks for your reply

1) 700
2) yes
3) Not sure, I guess I would find out if I were to do a credit check, which is what I am trying to decide if it is worth doing right now. Is there any other way to find out if she has any other debt/obligations?
4) I will ask her tomorrow if her mother would cosign. Does that mean i have to do a credit check on her mother as well?

These are all very helpful questions to ask thank you

 

[housingrental]

Sure happy to help

To your eyes are you comfortable with someone with before other debt payments if applicable using almost 47% of gross income to cover rent? Is the income source stable (How long until benefits run out?)

Yes you`d want to screen guarantor. Is mother willing to act as a guarantor and in a position to do so?

QUOTE (princecharles @ Jan 7 2010, 08:51 PM) Hi Housingrental thanks for your reply

1) 700
2) yes
3) Not sure, I guess I would find out if I were to do a credit check, which is what I am trying to decide if it is worth doing right now. Is there any other way to find out if she has any other debt/obligations?
4) I will ask her tomorrow if her mother would cosign. Does that mean i have to do a credit check on her mother as well?

These are all very helpful questions to ask thank you

 

[Nir]

QUOTE (princecharles @ Jan 7 2010, 06:41 PM) In terms of the competition, it doesn`t get much better.

Prince, not clear what you mean(?) that your mother, as a landlord, does not have much competition? meaning it`s a landlord`s market where she is?
or.. is it vise versa? if the first then you answered your own question - don`t compromise and don`t accept a baby earning $500/mo with mother making almost double. cheers.

 

[princecharles]

Thanks guys!

How do I find out if the tenant has any other debts?

Also how do I assess the co-signer`s suitability? What should I ask for?

Investsmart - sorry no, when i said "In terms of the competition, it doesn`t get much better."
I meant that in terms of the market for potential tenants, there doesn`t seem to be many that have low risk profiles.

 

[asifghayoor]

QUOTE (princecharles @ Jan 7 2010, 10:38 PM) Thanks guys!

How do I find out if the tenant has any other debts?

Also how do I assess the co-signer`s suitability? What should I ask for?

Investsmart - sorry no, when i said "In terms of the competition, it doesn`t get much better."
I meant that in terms of the market for potential tenants, there doesn`t seem to be many that have low risk profiles.


if you need to go after the tenant for damages or rent you cannot garnish ontario works(welfare) so you might be out of luck in a bad situation. I have no idea why its called ontario works, that confused me too when I started last year, it should be called Ontario not works, or doesnt work, or cannot work, or anything but ontario works....

Asif Ghayoor P.Eng

 

[invst4profit]

Being a LL in Ontario is very high risk. For that reason you must be very selective when choosing tenants.
Single mother, no job, no way I would ever rent under those conditions.
How would your mother feel evicting this single mother in the winter with no place to go. Or worse how would she like having her live there not paying rent and have her new boyfriend, that also doesn`t work parties all night and does drugs move in with her as well.

Welcome to the world of Ontario landlords.

Do your mother a big favour and be very selective in finding the best possible candidate.
Find someone stable with at least 2 full years of employment, same employer, no kids, no pets, no smoking and a good credit rating.
Your mom is in the enviable position of not being in this as a business and should take advantage of that fact by taking her time in selecting the best possible candidate.
Then have her cross her fingers and hope her new tenant isn`t crazy.

Study the RTA before she gets her first tenant, you must know the rules first.

 

[rforgiel]

My rules for deciding on Ontario Works tenants are:
- you want to see the cheque stubs from Ontario Works and Baby Bonus to confirm she is actually on the programs and getting what she claims
- do a credit check and reference check; her references are probably her mother
- go check out where she lives now and see how she keeps the place
- I want Ontario Works to send me the rent cheque directly; have her sign up for this
Having the rent cheque sent to you directly is nice but no guarantee as they can opt out at any time. My property manager has also been burned by this once on last rental payment as the cheque can be issued and the tenant can put a hold payment on it.

Also have the mother on the lease as a guarantor. It is some reassurance but if there is damage payments to collect you will need to take the mother to small claims court which is a pain. In case of non payment of rent I am told you can serve the daughter and mother with the N4 and seek rent arrears from both but I have not tried this yet. Hopefully someone else on this board can confirm this.

OW tenants can work but they are usually higher maintenance and rougher on a place.

 

[lazyinvestor]

QUOTE (invst4profit @ Jan 7 2010, 11:38 PM) Being a LL in Ontario is very high risk. For that reason you must be very selective when choosing tenants.
Single mother, no job, no way I would ever rent under those conditions.
How would your mother feel evicting this single mother in the winter with no place to go. Or worse how would she like having her live there not paying rent and have her new boyfriend, that also doesn`t work parties all night and does drugs move in with her as well.

Welcome to the world of Ontario landlords.

Do your mother a big favour and be very selective in finding the best possible candidate.
Find someone stable with at least 2 full years of employment, same employer, no kids, no pets, no smoking and a good credit rating.
Your mom is in the enviable position of not being in this as a business and should take advantage of that fact by taking her time in selecting the best possible candidate.
Then have her cross her fingers and hope her new tenant isn`t crazy.

Study the RTA before she gets her first tenant, you must know the rules first.

Which province is the best from Land Lord point of view? From what you wrote here, Ontario doesnt sound that great. What about Alberta?

 

[housingrental]

Alberta seems better...
Texas seems best : )