Home rental after ER

[walkinwood]

A friend of mine told me today, that most apartment and home rentals ask for proof of employment.

Is this true? If so, how do ERs handle it?

I have my doubts about it being true, but this guy has just lost his job and was thinking of selling his home and moving into an apartment to preserve cash flow.

[brewer12345]

I suspect that telling them you are retired and offerng a large advance on the rent (6 months) would probably quell any concerns.

[Meadbh]

As a landlord, I am more likely to want a (respoonsible) ER as my tenant than many other types of people. I expect a property manager to ask for copies of pension stubs or a letter from a financial institution.

[W2R]

Quote:

Originally Posted by walkinwood A friend of mine told me today, that most apartment and home rentals ask for proof of employment. Is this true? If so, how do ERs handle it? I have my doubts about it being true, but this guy has just lost his job and was thinking of selling his home and moving into an apartment to preserve cash flow.

I have thought about this potential problem, too. After I sell my house and move north, next year or the year after, I will want to rent. I have a pension, but it really isn't enough to cover rent so I doubt that pension stubs would help me. Instead, I will go armed with my previous year's tax return and hope for the best.

It seems to me that the big apartment complexes with professional property management may be tougher about requiring proof of employment, than would be an individual trying to rent his/her house (that possibly they couldn't sell during the real estate downturn). So, if I have trouble renting an apartment, I'll go for a house!

[Alan]

It's a good question and I don't know the answer but am interested in finding out. We rent in a big apartment complex but were renting before we retired. However, I'm sure we'll want to move at some point.

I would think last year's tax return showing proof and sources of income would be a good start.

[haha]

Quote:

Originally Posted by Alan It's a good question and I don't know the answer but am interested in finding out. We rent in a big apartment complex but were renting before we retired. However, I'm sure we'll want to move at some point. I would think last year's tax return showing proof of income would be a good start.

I rented a apartment in a professionally managed building with no income other than portfolio income. I had zero problems.

Ha

[Alan]

Quote:

Originally Posted by haha I rented a apartment in a professionally managed building with no income other than portfolio income. I had zero problems. Ha

Excellent - no worries then

[meaglin]

I'm an ER also, but also have a couple of rentals. In the case of someone retired, I am more concerned that a prospective tenant has the ability to pay the rent than I am with employment. If you can satisfy your ability to pay I doubt you will have any problems renting a residence.

[walkinwood]

Thank you for your responses. We do not have a pension, and we've tried to keep most of the dividend generating asset classes in IRAs. As a result, our income is quite low. I assume I'll have to up the deposit and get a letter from Vanguard. I still have time to figure this out since we're planning to stay put for at least another year.

[Amethyst]

WIW,

We are private landlords, so can't speak for an apartment complex. We expect a tenant to show reliable proof of continuing income. Usually they provide a recent pay stub, and I call the employer to verify they still work there.

If the tenant lived solely on the fruits of investments (have never seen this), we would accept a recent statement from a reputable financial outfit, showing there's enough in the pot to generate adequate income. A letter would suffice, as long as it contained actual amounts, not just a blanket statement. (We have had to provide similar proof of "enough in the bank" to a real estate agent, when "pre-qualifying" to buy a house). If we don't accept the applicant, we give their paperwork back.

We avoid folks who offer several months' rent up-front, and say "trust us, the rest will be there when it's time." Without proof of income, we don't know whether they borrowed the up-front money and are having trouble paying it back.

Amethyst

[W2R]

Quote:

Originally Posted by Amethyst We avoid folks who offer several months' rent up-front, and say "trust us, the rest will be there when it's time." Without proof of income, we don't know whether they borrowed the up-front money and are having trouble paying it back. Amethyst

Good idea. There are more potential problems in some states. Even if they paid rent for the entire lease in advance, they could refuse to leave when the lease is up. Eviction is difficult and expensive (at least here in Louisiana).

[Amethyst]

Quote:

Originally Posted by W2R Eviction is difficult and expensive (at least here in Louisiana).

AFAIK, this is true everywhere. State laws and public sentiment, in the U.S., tend to favor tenants.

I almost forgot, Most ER's would have one big thing in their favor: excellent credit ratings. Most renters' credit ratings tend to be middling - at best.

Amethyst

[tryan]

Pension and/or SS works for steady income.

Closest thing I 've seen to "no income" was an unemployed (between jobs) mom selling her house. Looking to downsize. Agreed to paying 6 months in advance out of the house proceeds. But I found a working couple instead. No income was a little tough to stomach.

[Purron]

Somehow, I'm waiting for MMND to weigh in. Doubtful, but she was one the strongest proponents for renting to ever appear on this board.

BTW, DH and I are landlords for now. Our renters moved out and we're fixing the place up. We'll either sell that place or home base to get down to one homestead. If I was still in the landlord biz, I'd be happy to rent to someone without a job but a healthy investment portfolio. My biggest concern would be the potential renter's credit history and references from prior landlords.

[Texas Proud]

I think that if they pulled a credit report and saw a great credit score they will be fine...

Usually, someone who lost their job etc. probably does not have a good score and they want to see a steady paycheck...

It is not hard to evict someone in Texas.... so maybe it is easier here...

[Caoineag]

The last four places I rented did not require me to prove income. They did all pull a credit report and some called references. Two of those was a mom & pop operation (they owned a couple of rental communities but evaluated people by how much they liked you), another was a single owner (we paid two months upfront because they knew we were moving there with no jobs yet) and the last was a managed community that did the little credit/rental instant check and approved us for move in.

There will always be places you can rent that aren't picky about income but I suspect that the recession will result in more wanting proof of income.

[TeeRuh]

Quote:

Originally Posted by Caoineag Two of those was a mom & pop operation (they owned a couple of rental communities but evaluated people by how much they liked you), . . .

This reminds me of a home we rented when I was in college. There were quite a few applicants for it because it was cheap ($90 per month) and fairly close to campus. We had very little income, but we had ... a 2 year old curly haired daughter that they fell in love with at first sight!! Lived there until I graduated!

t.r.

[walkinwood]

Quote:

Originally Posted by TeeRuh This reminds me of a home we rented when I was in college. There were quite a few applicants for it because it was cheap ($90 per month) and fairly close to campus. We had very little income, but we had ... a 2 year old curly haired daughter that they fell in love with at first sight!! Lived there until I graduated! t.r.

That sounds like a plan, but would destroy my ER projections
Thanks all for your input. We'll have to do the leg-work for the rental before putting our home on the market.

[Gone4Good]

I'm with Brewer. If that doesn't work then I'd look for somewhere else to live. It's not like there is any shortage of housing.