I have been renting houses for about 5 years now and have never had to consider having a cosigner for an applicant until now. I have a recent college graduate who is looking for a job (doesn’t have one yet) who wants to rent from me. She’s stated her parents are willing to co-sign on a rental application for her.
Has anyone had to deal with co-signers? What process did you use (i.e., application/credit check for the co-signer), did you have them on the lease also? Was there a point during the tenancy that you released the co-signer from responsibility? Did you have any problems with collecting rent from the co-signer?
I don’t rent to people if their last residence was mom’s home or college dorm. That includes young kids and older people that had to move back in with mom for some problem. If she doesn’t qualify, I tell her so and keep looking.
People that are out on their own for the first time have not gotten their minds around the concept of the hierarchy of payments. In other words they have always been able to spend their money on whatever they wanted to and even if they ran out of money, they could still go home. When they are on their own, they have to pay for home first (meaning my rent) and then everything else. I let them figure that out on somebody other than me.
I understand that she has to start somewhere, but not with me.
Yes just put them on the lease / application and treat as a co tenant. If parents own thier on home you could not get better security since they would be easy to locate and collect from compared to a lot of other tenants.
I currently have two tenants with whom I’ve included a rent guarantee form. One is a college couple, and the other is a VERY mature single woman.
The college couple struck me as non-animal house types (thankfully I was correct) and the father co-signed. Big income easy to find. I felt that these kids would be less likely to stick Dad then some stranger - me.
The mature lady came to San Diego from New Jersey and I took her sight unseen based on her son and daughter in-law. The son co-signed for her.
In both cases I ran credit on the co-signer before making the agreement. Upon reflection, a viable co-signer (for me) would need to be of substantial means - income far exceeding visible needs.
The net result is: you have a responsible person with a very good job to insure your rent- not your average renter flake.
I try to think of most possible situations – say eviction is required, wouldn’t it be a little messy having the co-signer on the lease? Here, everyone on the lease must be personally served if the landlord is going to request monetary judgement as part of the eviction.
I’m just trying to figure the best way to cover my @@@ if I do accept a co-signer.
A rental guarantee is a seperate document from the lease/rental agreement. It is simply a document that establishes financial responsibility for any monies due under the agreement.
In my state you only need posted service at one of their addresses, can even leave it in the door if no one home. Or if you wanted to serve also at parent’s house would be about another 38.00.
Or just add a small section at bottom of lease for parents that said they also agree to be financially responsible for all the terms on the above lease and to guarantee all payments.
I myself like the co-tenant approach. Gives the guarantor the legal right as a co tenant to enter the property and see if it is being kept up. Tenant may keep the place a little better. Parents have no excuse not to keep an eye on the place.
Either way is fine.
I use a separate co-signer form for the co-signer to sign. I don’t like putting multiple people on the lease, because they all claim that the other is responsible - even though they are all individually responsible for the entire amount. Just personal preference. I do a criminal background/credit/employment check on the co-signer. The co-signer must have a long-term job for me to consider them. I want them to have something to lose.
Using this system, I only evict the tenant (if necessary) and then demand payment from the co-signer. If they don’t pay, I first make a few trips to their work demanding payment and then sue if this doesn’t work. Usually, one trip to their employer will work wonders.
In Ohio, when I post a 3 day notice, I always put “AND ALL OTHERS” after the tenant’s name. That way, no matter who is living there - they’re all out! I either deliver the 3 day notice in person or post it on their door if they’re not at home. I gave three tenants eviction notices this month; collected two late fees; and had to file an eviction against one.