Thought experiments for the weekend:

1. Your animal policy is, no puppies and non neutered pets.

Good applicant that otherwise qualifies but has non neutered dog - stick to your policy or bend the rules?

2. Your credit score must be above 625

Otherwise good applicant has 616 - stick to your policy or bend the rules?

3. Your credit score must be above 650

Otherwise good applicants (husband & wife) however one has a credit score of 550 and the other has a score of 700 - stick to your policy or bend the rules?

How big is the dog?

My animal policy is: no pets

My credit policy is: CLEAN credit record

Applicant with 616 credit score: Why is his score so low? Did he ever stick someone with a bill? Would he do that to me? Plenty of applicants out there with clean scores.

Otherwise good applicants (husband & wife) however one has a credit score of 550 and the other has a score of 700.

Otherwise good?

NO NO NO NO Puppies. For a host of reasons.

NO NO NO NO older non-neutered dogs: they can be aggressive and neutering after a certain point does no good. Plus a person who won't neuter their dog is not the type of irresponsible person I want as a tenant.

I like a policy of no collections, no charge offs, no late pays better than a FICO score determination . A FICO score minimum requirement is very useful if you are employing a novice and are setting screening policies. If you are personally involved in screening, FICO score isn’t your best bet.

"we are all just a few minutes away from catastrophic medical bills"

Um hello that is what health insurance is for. I was checking my wife's , she has $1,500 deductible and $4,000 OOP max. That means her yearly medical bills are capped at $4k.

It's not hard to get a 700+ , nearly all of my tenants don't have mortgages (obviously) yet they manage to get 700, sometimes 800.

I waive medical debt.

I know plenty of people with $4000 per person deductible and $4000 per person out of pocket max... for each family member. For a family of 3, that is $12,000 they may pay out, in addition to the insurance premiums. The person I'm thinking about pays about $1000 a month as a premium, they don't qualify for a subsidy.. barely.

For the 2023 plan year: The out-of-pocket limit for a Marketplace plan can’t be more than $9,100 for an individual and $18,200 for a family. It has been rising a few hundred dollars each year for the last few years.

How many people do you know who can't come up with $18,200 to pay for medical care if two or more people in the family are seriously ill?

Barb, I understand your position when the applicant has $200k medical debt and a$50k income, but, do you waive unpaid medical debt of all amounts? For more than 30 years I have been hearing about medical debt that cannot be paid, yet, I see few whose medical debts exceed $2000. People who won’t pay 5 or 6 $ 85 - $250 bills are most common.

Clearly, these people can pay, but won’t pay. Therefore, I think that I am better off to reject their application than I am to approve it.

My observations of the past decade have been that student loan debt is far more often of unmanageable amounts for applicants than medical debt. However,. I don’t think that I will likely get a prompt paying resident by waiving consideration of student loan debt.

The student loan debt seems to corrupt people and encourage them to not pay any lenders as agreed.

I appreciate all your thoughts. Part of these questions are because I've set up more automation which will DQ people before I even talk with them. Is this a good thing? Will I throw out some kids with the bath water?

I still think the automation is worth it. It makes it more manageable for 1 person. Dealing with 100+ inquiries while having a full time job and hoping for some family time requires a certain level of automation.

The automation will send a DQ email if you have un-neutered pets. I followed up with the otherwise good candidate and they said the dog was 10 years old and they had no plans to neuter the pet. It was also a lab mix (whatever that might be) but I was OK letting go because as WMH said part of the screening is compliance and cooperativity.

I have found low FICO scores correlate with an increased change of me getting some excuse for late payment. I don't have time for that. I want to get paid and paid on time. So maybe I won't have to worry about the couple with a high and low credit score but I don't feel like taking that chance at this time.

I think that you need to set the bar and have people meet it. While I could say it is part of Fair Housing to treat everyone equally, we all know that life isn't fair and sometime you just want the unit filled and maybe you take someone who isn't 100% perfect. There is a grey area to vetting people and I appreciate you all exploring that with me.

If all three members of a family of 3 get so ill in the same year to each need more than $4k medical expenses , there is something seriously wrong. Either the family has poor health habits or maybe genetics. Doesn't matter, as you said they roll the dice and got cheap health plan. That screens poor financial planning.

My wife is on PPO from her work, we ran the numbers it is only a few bucks more than HDHP. Same for me, I just switched jobs and the PPO is not that more than the HDHPs.

Oh about the automation, I like that I can say that all applicants are treated to the same criteria. There is no favoritism. My obligations to Fair Housing are met by giving everyone the same access, the same forms, and the same opportunity.

What is interesting to me, is that when the program sends them an email that says, you can view the property just set up a time on my calendar. Some people do not follow through.

Now the market here for SFH is tight. You'd think people who say they are interested and go through the effort of the pre-screening form would follow through with the invite to view.

There is two reasons why I use fico as the main prescreening criteria

1) criteria such as job history and rental references are in the past . If a tenant has high fico, they have incentive to maintain that score by continuing to pay their bills.

The market here is tight as well. All the dregs of humanity that were either not paying or having the gov pay rents are now out there looking.

I do not accept gov assistance for rents. Had a guy text me asking if I accepted such and such plan. I said I didn't even know what it was but we don't accept any at this time. OK he says, and then asks if he would have to pay a deposit. I didn't even respond. Should block his number but curious what other silly questions might come up.

You can not require a service dog to be neutered, and I am going to assume that might apply to an emotional support animal also, just to be on the safe side. So be a bit careful about automatically rejecting any applicant with an unneutered animal.

I've got several pages in my written criteria about pets. It's about PETS and many of the criteria can not be applied to service animals. I have service animals in the written criteria, too, being careful to stay legal in the requirements.

Sisco - You are right that medical debt needs to be case by case, like most stuff. I waived one about 20 years ago, who had about $10K in medical debt from a broken leg with no insurance and no means to pay it. She was paycheck to paycheck, plus in school, and just didn’t have the finances to set up a payment plan. I had advised her on how to apply for a waiver for it, no one had told her.

One of my longer term tenants moved in about 6 years ago and was up front. Husband had died, after a long illness. They had over $200K in medical debt. There was no way she could pay it back. She recently declared bankruptcy, and it came out that her student loans had ballooned. They had been sold or transferred between 4-5 different servicers over the years. What started off as about $50K in student loans ended up being nearly $500K in student loans. Apparently even the judge could not figure out how. The judge finally included them in the bankruptcy proceedings.

David - not everyone has access to an employer provided plan. Not all employer provided plans are very good. It is very easy to hit $4000 in medical for one person in a year, sometimes crap just happens. In my friend’s case, the small child fell off monkey bars and broke an arm. Emergency department visit, there goes $4K. She was diagnosed with RA. The meds for RA are expensive. Sometimes people are just unlucky.

Over the last couple of years, I have a new appreciation of medical debt. My hospital stay last year was over $300,000 according to my insurance EOB. Luckily, I had good insurance, but I still was on the hook for $3500 as my OOP max through my employer provided policy. This year, my OOP Max was $4000. I hit it on January 4 when I received my first chemo dose of the calendar year.

Most hospitals will let you set up a payment plan. My wife found out she was pregnant with first child after the open enrollment period expired, so she was stuck with a HDHP for the next year where she would be giving birth. That meant we had about $10k in OOP, but we paid for it over the course of a year on a payment plan . The next kid we found out a month before open enrollment so we changed to PPO.

I want tenants who are healthy, who are financially responsible and have the means to pay health care costs. If someone has a chronic illness that's too bad , I can't discriminate based on that but I can discriminate if they can't pay for health care costs.

Oregon, you said “You can not require a service dog to be neutered, and I am going to assume that might apply to an emotional support animal also, just to be on the safe side. So be a bit careful about automatically rejecting any applicant with an unneutered animal.”

Being qualified is like being pregnant.

Either you are or you're not.

If you have an upset stomach in the morning, gain weight, and crave pickles with ice cream - it doesn't mean you're pregnant. You need to pass that one, final test at the OB/GYN's office.

DJ ,

Many LL will qualify a marginal tenant with a higher deposit.

Me, if a tenant is marginal on rental references, for example if they only have their current landlords reference but no prior landlords reference, then I will qualify with $50 extra rent.

Why bother letting them enter every question ?

In programming, in an if statement with two conditions connected by AND, if the first one is FALsE the second condition isn't even evaluated.

If they don't pass question 1, stop right there, don't let them goto question 2

If they don't pass q2, stop and don't let them goto q3

I log every question to every answer so that if or when they change their answer, I have their original “truth”.

Jason, don't be so full of yourself. Obviously I was including the explanation of an if statement for the benefit of all the readers here.

There is nothing wrong with doing things differently. It's finding what works for you that is the key.

Animal policy - no dogs. period. No really, period. 2 cat limit and we see where they are being kept in our current residence inspection

If you have criteria and they work, then stick to them. Don't "bend" them.

If your criteria aren't working, then change the criteria so that they do work.

I find credit scores to be a poor decision making tool. As Sisco says, the info on the report is more important.

Instead of focusing on why is this person's credit score low , ask why haven't they made the effort to improve it?

If an applicant shows up , say, with their pants sagging below their behind, you would think it is easy for them to pull it up and look presentable even though it may not say anything about their reliability as a tenant.

I would venture to say that nearly none of my tenants know what their score is, nor do they care.

Usually the only time they worry is when they are trying to buy a house or car.

I have an array of middle class people. Some a little upper and some a little lower.

What ever the standard that you set for that specific unit, keep your approach standard across the board on all applicants. Its the law and you deserve the ability to sleep well at night knowing you are treating everyone fair.

So what happens when no one qualifies?