House rental proof of income for a retiree?

[Cessna152]

Wife and I have just retired and are planning to sell our current home and move to another area. We want to rent a house there for a year at least.

I'd completely forgotten that rental applications ask for source and amount of monthly income and that it has to be some factor higher than the monthly rent.

So how have you retirees who rent but had no income managed this situation? We have no pensions and have not yet started drawing SS - just lots of money in cash and Fidelity mutual funds and very good credit ratings.

 

[ExFlyBoy5]

Wife and I have just retired and are planning to sell our current home and move to another area. We want to rent a house there for a year at least.

I'd completely forgotten that rental applications ask for source and amount of monthly income and that it has to be some factor higher than the monthly rent.

So how have you retirees who rent but had no income managed this situation? We have no pensions and have not yet started drawing SS - just lots of money in cash and Fidelity mutual funds and very good credit ratings.

It really just depends on the landlord/rental management company and there is no one "right" answer. My DW w*rks for a very large rental management company and they don't have a single answer for your question...it depends on several factors and ultimately what the home owner will accept.

 

[lhamo]

I early retired in 2015 and moved back to the US from China -- not only didn't I have a job/an income, I also didn't have any local housing references! Didn't turn out to be a problem. I did print out a copy of my credit report (800+ score) and took copies of my latest bank/investment account statements. Also told landlords that I would be willing to pay a larger deposit (up to 6 months up front) if they had concerns. None of them asked for that. Nobody had an issue with my lack of income. I was dealing with all owner-managed rentals, though -- a property manager or corporate complex might not have had that kind of flexibility.

 

[razztazz]

I thought I would have that problem but i had no problem even with an apartment complex owned by a real estate conglomerate. I had a pension but it was quite paltry. I don't remember them even asking me for anything special like 1040's, bank / brokerage statements.

I do remember mentioning up front when I went into the office that I was recently retired and income numbers were not indicative of my ability to pay.

And thanks lhamo that's good to know. I might be moving out of this place in the next couple of years. I have never rented a house before, at least not since retiring. I didn't know if owner-managed rentals would be harder or easier to get into. Apartment complexes unless they are "luxury" or some high-end thing strike me as more likely to rent to lowest common denominators. The owner-managed properties could be more choosy or less so because they don't have the leeway higher volume could allow. But I am definitely not in the real-estate bizz

 

[Franklin]

Wife and I have just retired and are planning to sell our current home and move to another area. We want to rent a house there for a year at least.

I'd completely forgotten that rental applications ask for source and amount of monthly income and that it has to be some factor higher than the monthly rent.

So how have you retirees who rent but had no income managed this situation? We have no pensions and have not yet started drawing SS - just lots of money in cash and Fidelity mutual funds and very good credit ratings.

I went thru something similar:
1) sketched out my cash flow for the next 10 years
2) showed FICO scores
3) showed my investments (liquidity)
4) tax return
5) had my ML advisor produce a letter and dividend/interest income schedule

After that info we had no problems. Just did the same thing for a refinance on a property I plan to ultimately sell. The underwriter needed basically this same info. Since most of my accounts were with BofA and my banker was with ML, they basically talked among themselves and sorted out the refi. But, it was the first time I ever had to think thru "how do u qualify without a paycheck!"

 

[Cessna152]

Thanks all who have answered so far. Sounds like management or owners are willing to be flexible on what they'll accept besides a "steady" income.

 

[brucethebroker]

Wife and I have just retired and are planning to sell our current home and move to another area. We want to rent a house there for a year at least.

I'd completely forgotten that rental applications ask for source and amount of monthly income and that it has to be some factor higher than the monthly rent.

So how have you retirees who rent but had no income managed this situation? We have no pensions and have not yet started drawing SS - just lots of money in cash and Fidelity mutual funds and very good credit ratings.

If you were the landlord, would you rather rent to you, or a one income family who are totally dependent upon a single employer for coming up with the rent money? Not all income is created equal (in the eyes of this landlord)...a smart landlord will know this.

 

[brucethebroker]

I went thru something similar:
1) sketched out my cash flow for the next 10 years
2) showed FICO scores
3) showed my investments (liquidity)
4) tax return
5) had my ML advisor produce a letter and dividend/interest income schedule

After that info we had no problems. Just did the same thing for a refinance on a property I plan to ultimately sell. The underwriter needed basically this same info. Since most of my accounts were with BofA and my banker was with ML, they basically talked among themselves and sorted out the refi. But, it was the first time I ever had to think thru "how do u qualify without a paycheck!"

Well said.
Personally, as a landlord, I would pull the credit, and look at either 3, 4 or 5. I don't feel it necessary to look at a persons tax return.

 

[marko]

Thanks all who have answered so far. Sounds like management or owners are willing to be flexible on what they'll accept besides a "steady" income.

I suspect there's plenty folks on both ends of the financial spectrum who keep body and soul together without having a 9-5 job/income. I'd guess experienced landlords run into this all the time.

My young nephew (the good one) once asked his mom how DW and I live without going to work every day; his entire perspective of life was 'go to work, get paid, pay for stuff, repeat'.

I've also mentioned here a few times how half my school mates haven't worked at a real job in 40 years thanks to their grandpa's "generosity"; somehow (sigh) they get by.

Not everyone goes to work every day. In fact, most everyone on my street isn't a 9 to 5'er. Some are ER, some sell real estate, one on disability, two are "one class per year" professors, two on family money, one a retired pro-athlete and one dodges the repo man as a profession.

 

[WaitinToRetire]

I heard you can request a letter from your investment company (Vanguard, Fidelity etc) stating what your investments would yield as income. Sort of like if it was an annuity for 30 years

 

[Helena]

.

Dave Ramsey would rant about this... then it happened to me.

In the 11 years I have been retired, I considered buying a new house in another area or renting a nice new apartment. In both cases, even though I have excellent credit, would be selling my current house which I own free and clear and have plenty of money in cash and investments [more than enough to buy the new house outright], because I had no regular paycheck, I didn't qualify for a mortgage to buy the house or rent the apartment. The only option given to me by the apartment manager was to pay a year's rent up front. The situation really aggravated me. But as it turned out, staying here in my paid off house was really my best option.
God works in mysterious ways.

.

 

[travelover]

I was faced with the same problem. I presented my FICO score (from Credit Karma to save a fee), our pension statements and one of my investment accounts with the proceeds of the house sale in it, to jazz it up. That was the end of the discussion, which moved on to "when do you want to move in?"

 

[NYEXPAT]

I live overseas and always offer to pay 6 mos-12 mos upfront. The funny part is when I move out and they want to do an inspection before giving me back my deposit and then realizing there was no deposit!

 

[Quelolinal]

If you pay in advance, I think there will be no problems. The main thing for all people is money if you can pay you will not have any problems. Although I think not all landlords are like that. There are probably exceptions.

 

[Winemaker]

As a landlord, when I am faced with this kind of decision, I ask for copies of their tax return. There, is the source of their income, spelled out in total. If there is any questionable issues, I ask for bank statements, as they show all deposits. if you are not providing a money trail, you are denied.

 

[Dtail]

When we rented our first year of retirement, I showed proof of our investment assets. That did the trick.

 

[BlueberryPie]

As a landlord, when I am faced with this kind of decision, I ask for copies of their tax return. There, is the source of their income, spelled out in total. If there is any questionable issues, I ask for bank statements, as they show all deposits. if you are not providing a money trail, you are denied.

If you're not pulling from tax-deferred accounts yet, are living off cash and high-cost basis mutual funds, your tax return may show very low income. I guess time to do those Roth conversions to show some income, but probably not impressive enough to secure that apartment

 

[Winemaker]

A bank statement, showing cash, will show me your ability to pay me. I don't care the source, but like all possible creditors, I want to see periodic deposits, whether it be pension, SS or retirement accounts, over a 2-3 year period.

It's just like buying a bond or dividend paying stock, you have to do adequate research to ensure whoever is paying you does/can and has the resources to continue.