Got an application via Zillow. Here's the recap:

Household Income is about $ 12,000/mo

Credit Score is 489

Total Debt is $ 170,000. Half of that is for car loans while the other half is secured and unsecured loans. Total estimated payments for debt service is about 5000 a month. Rent for my place is $ 2200 plus utilities.

The applicant's job is secure as he works for the government. He's relocating here from Maryland. This is from a pre-screen and I've not shown him the place yet. Would you take?

I wouldn't like him for reasons that have to do with my mind set, rather than numbers on a paper.

Why does someone earning $144,000 a year not own a house?

Why would anyone have $85,000 in debt on depreciating assets when clearly their overall net worth doesn't support vehicles like that?

what you asking for deposit?

With this low a score I would need 3 months dep. and even with that I'd need to personally eval-- good phone numbers of relative's.

489 is just risky and I like risky if there's potential for garnishment. Does your state allow garnish?

how much interest is there other than this person?

I disagree with the premise that the low score is due to debt and not late payments. A score that low includes late payments.

This is a tough one. I have a friend in the car business and he said it's common for people to finance a new car for 5 or 6 years (or more) and then come in after 2 or 3 years and want something new. So they roll their negative equity into the new car. Incredibly stupid but it happens a lot.

Credit score is below my minimums

Like Larry[MN], I'm having a hard time believing low credit score is due to few debts. I used to joke that when I graduate college and had nothing but a Discover Card with a $1200 limit and an American Express card with a $500 limit, had never had car debt, no student loans, nothing else.... I still had a 721 credit score.

Most of the "little debt" people I see either have NO credit score or a mid to upper 600s. I had an applicant a couple months ago with one car loan and had a 743.... go figure.

Have you seen the credit report yourself, or are you basing your statement on what the applicant says?

Bare minimum, I'd require 2x the rent as deposit, and I want to see the full credit report, not just the score.

Next !

I agree partly with Sid and myob. I can't believe that's the main reason for low score. I'd accept but only with 3x rent as a deposit. You could do something to soften this such as...

"Due to a credit score that is lower than our minimum accepted, this application presents extra risk. As such, tenant agrees to provide a deposit of 3x the monthly rent. This deposit can be used at LL's discretion for unpaid rent, damages, or any other fees according to the lease. If the tenant makes on-time payments for 12 consecutive months, LL will conduct an inspection and if no damages are found and no fees are due, one month's worth of this deposit will be refunded to tenant."

Previous to coming to town for work, what is his rental history like? Does he stay for more than a year or does he move around alot?

I first thought the same as some above regarding his credit score. But credit utilization is said to make up 30% of a credit score. Depending how recent or how many newer lines of credit factor in oh this too.

Where the rest of his income comes from other tan the government?

with this new info, that he's with the us treasury, he falls under 2 of our 4 "we don't rent too".

Police and Politician--- so its a definite NO.

I'd look at the complete credit score. After he pays his debt, he still has three times the rent in income. So it all depends upon exactly what is in his credit report.

$60,000 in car loans doesn't even cover two very ordinary bottom of the market cars (if he is married and needs two cars). It doesn't even cover one new pickup or SUV. $60,000 for car loans is no surprise and I suspect we are going to see a lot of that sort of debt.

If I understand the scenario, this is a two income household with $12k per month gross pay combined.

If the above is the case, they will receive approximately $8400 per month net pay. Subtract $5k debt service an $2.2k rent, they would only have $1200 month to pay utilities,phones, food, clothing and other expenses.

Yikes, that sounds exactly like a guy who applied for a sfh a number of years ago. We got concerned when he pulled out a laptop and searched for a neighbor's unsecured wifi in order to show us some information. His family was also silent and sullen. Red flags to us.

His references were stellar, his income confirmed by calling through the main number for the corporation rather than using the number he'd given, etc. We got his $ to pull credit, and found pretty much what you did. But the family had also moved from state to state over the past 10 years, leaving medical and other debt in their wake. And the background check showed judgments in favor of landlords.

We declined due to the amount of bad debt to income ratio and the negative rental history - never heard a peep from him. I guess he was just casting a net to find the right private landlord to be dazzled by his income only.

I am sure you know but you cannot charge 3x security. Double only and one of those years goes back if he makes it twelve months.

These folks are just living well beyond their means and in my churning brain, that means they don't care. So if it comes down to it at some point, they'd have no problem letting you hang.

$144,000 income, basically no debt and not owning home would be doable as they spend their money on living the good life.

G,

Are you smarter than FICO and their calculations?

Dunn & Bradstreet estimates a 489 Credit Score predicts a 70% likely hood of delinquency.

It”s up to THEM to prove they are stable, not YOU to try to fit a round peg into a square hole. Steer away from potential drama.

Next!

BRAD

(Deny based on your written criteria’s CR requirement.

Just remembered…Z apps only show ONE person, not the couple. HIS report might be clean but HER report could be awful. FICO combines the two people.