Aldeer.com Forums Alabama Deer Talk Aldeer General Forum Renting a house. Need advice

I am about to rent out my house. Haven't been able to sell but have some people interested in renting it. Is there anyway I can run a credit/background check and also income verification before I let someone rent? I was advertising for sale by owner, I noted that I would be willing to rent also. Seems that it has come down to that now. Any help would be appreciated. Thanks

Before giving them the lease agreement, ask them to answer a few questions, employment history, previous renting places with contact information, etc.

Yes. You can get it all done, but it costs a fee usually. My previous landlord ran all of that on us before we were able to move in.

And be sure to drive by where they are living now. That is what your place will look like a month after they move in.

Remember to charge them an application fee to cover the cost of the report. Should be a local collections agency you can get to run their report for a fee.

And do what Marksoutdoors said. That is very true.

Or you can post it on craigslist and rent it to Gary and SouthBamaSlayer.

Heck yea...but get the cameras installed FIRST.

Also, keep in mind when you rent your primary residence, you will loose your homestead exemption. May not be a big deal in Alabama but I live in Florida and it can be. I rented my residence when I got remarried years ago and my payment went up about $200/mo.

It may have changed but when I rented mine if you rent it over three years without you living in it , you will have to pay capital gains on it when you do sell

If the renters want to pay in cash you don't want them

It's two of the last 5 years you had to have lived there. There are a lot of other exemptions for partial tax write offs for capital gains as well such as moving for work, illness, divorce, etc. It's complicated and if it's a lot of money you should talk to a cpa.

I only accept cash. No checks allowed.

You can have a credit check done but keep in mind, a fair % of folks that are renting don't have good credit. I'm not saying all have bad credit but from my experience, if they had good credit they'd buy a house.

If I were you, I'd consider a lease purchase. Take a fair amount down and figure them a monthly payment for 10 years @ 10-15% interest. Most of the time, they will never actually finish paying before moving out. You get the deposit, years of rent, and you get the house back and you start over.

Also, if the house is "theirs" they tend to take better care of it.

Call their current land lord, call their employer and verify employment. If you don't want pets put it in the lease, also be sure to provide the lead based paint declaration or lack there of. You can get state specific rental agreements off the internet or get a lawyer to draw it up. You want a strong rental agreement that covers everything.

Here's what I would make sure of:

1) Monthly income needs to be greater than 3x the rent amount ($900/month rent x 3 = $2700/month minimum income). Get paystubs from employer and call the employer to verify that they work there and are in good standing

2) Verify their rental history. Call their previous landlords and see what kind of renters they were. If they can't provide that to you, make them pre-pay for the last month's rent with the security deposit and the first month's rent. It's more risky renting to people who haven't rented before or who can't provide landlord contact info.

3) Don't give them a key to the house until they transfer the utilities into their name and ask for proof (account numbers). If you give them the keys without doing that, you could get stuck paying their utility bills

I always call power and water company and tell them to take it out of my name that day after they sign a lease. Ditto on income verification

I recommend a lease to own. We set up the lease with a set purchase price in a year with an option to buy any time. If they don't buy it at the end of the year you keep the deposit. You can also renew the lease if they're good renters but if they're not you only have to deal with them for a year.

Thanks for all the replies. I hope I can make this workout. I was a little nervous before. After reading the "horror stories" thread I'm a lot nervous.

So far Ive had no problems at all with my renters. They keep the house clean and pay on time.

Just remember one thing. It's a business and the house is an asset of that business.