i am just renting out my second investment property. I am getting 525 per month for rent and a $525 deposit. The tenants want to move in on Dec. 15th. what do most people do as far as 1st months rent and deposit? do i get the $1050 up front and then collect another $265-half months rent on Jan 15th? and then the full amount on Feb. 1st? or do i get the deposit, 1st months rent, and half a months rent and be paid up until Feb. please advise.
thanks
hi i would do $1050 up front and then make tenent due on the 15th of the month so you will collect 525 on the 15th of jan. i hope i could help.
If my prospective tenant is moving in on the 15th I get security plus the 1 1/2 months at move in. I tell them I prefer not to accept partial month’s payments for rents.
If I do that I am setting a precident that I might accept partial payments down the road. It also demontrates their ability to pay their rent.
If they are short on $$ going in… especially this time of year, they will be short again.
Jeff
Thanks for your replies. Ive thought to do both ways suggested here. Im not sure about their money situation, but i still need to do the screening today and if it all turns up ok, i’ll ask them for deposit plus 1.5 months rent. if it cant be worked out that way, then i will make rent due on the 15th as i do agree about the 1/2 month rent being a bad sign down the road.
Remember, that if you do that, they won’t owe rent until February 1 (they paid for partial month of December and all of January) and you owe income taxes on the January rent in 2005 beause that’s when you received it!
LOL…
Keith
Yes, that is a very good point, but i think i would rather have the money up front then possibly not getting it at all lol
<<…i think i would rather have the money up front then possibly not getting it at all lol>
…if that is a real concern, you should screen your tenants better!
Keith
ok, this is a pretty east question and situation here i think. My g/f works in the county court. She had a friend do a background check on the people and they had a list of criminal activities ranging from theft, bad checks, drug charges to assult. The thing is the person that did the background check said that we didnt here it from them. Also the monthly income stated is only $800 and rent is $525. my question is do i go any further with this? The couple are Afri-American and im not quite sure how to tell them that they are denied and also dont know about them coming back at me on discrimination. Any advice here?
I usually require that their income be at least 3 times the amount of the rent. I think this is pretty standard, so you could say that they don’t have enough “verifiable” income.
You’re right…that is an easy one…
It is NOT discriminitory to deny a rental to people based on prior criminal activity or low income. You need to have no more than about 30-40% of gross income going for housing expenses – this includes utilities. Even without utilities, you are looking at 65%. If they have stated income of $800 per month, these people cannot afford the property, unless they have income from other sources…like illegal sources… that they aren’t declaring. The income ratio does not support them renting. Period.
After paying you the rent, they are going to have $275 left to pay transportation, utilities, food, etc. You won’t get your rent. If they ask, tell them as it is – “I’m sure you’re great people, but your current income does not support the cost of the rent”…
Keith