We're renting out a four bedroom house. Two people have applied together for the residence. Their combined income does not meet the required monthly income (3x the rental price). They may want to fill out applications for their fiances so their fiances' incomes can be included in the monthly take home, thereby qualifying them for the rental. What are the disadvantages, if any, of splitting the lease four-ways? Should I request an application fee for all four apps?
2006-09-30 06:25:15 · 6 answers · asked by ASW 2 in Business & Finance ➔ Renting & Real Estate
The 4 people must all be on one lease & all are equally responsible for any damages. If the damage is $1000, then they must split it, making each have a share of $250 each. The problem comes later, when one of them doesn't want to pay their share. What happens? If they are all 4 on the lease, then you have a better chance of collecting from at least ONE of the parties & they must fight it out in court at a later date to recover their losses from one another, leaving you out of their financial battles! You can't legally split your property into 4 separate rentals without going through the proper channels with you City zoning & ordinance board. You risk losing your property by breaking the law, especially if you do end up having to go into court for anything. Have ONE FEE, ONE CONTRACT, naming ALL parties on the ONE RENTAL PROPERTY ADDRESS & state that if there is a loss, that ONE of them might end up having to pay for everyone else's stupidity, but you will have a better chance of getting your money in the event of a loss/problem. If no one pays, then they ALL get a bad credit report. This way you don't have to deal with building code inspectors & code violations! 4 people is 4 different families & that constitutes a boarding house arrangement, which is illegal in most single family residents. What if they turn you over to the tax board for an audit? What if each of the 4 tries to claim a renters refund, come tax time? How does your homeowners insurance measure up to multiple families residing on a single family dwelling? These are things to think about because you just could end up losing a lot MORE than money!
2006-09-30 07:54:51 · answer #1 · answered by Anonymous · 0⤊ 0⤋
If they don't qualify now chances are they won't be able to make the payments. There is no guarantee that they fiances will make it for them. I would look at renting the house to a military family if there is one around if you live near a base or renting it to a family. Renting a house to 4 people is just asking for trouble. What happens when the split up and leave only one person there. Your rent is then cut in half and you are out looking for renters. What about if the couple split up then what. I would really look at renting to a family or one person who qualifies. I don't rent to single people any longer, they have left me holding the bag too many times. There are no gurantees with any person or people that they will work out but get references and do a credit check. It is cheap and easy and is worth the money.
2006-09-30 13:33:24 · answer #2 · answered by ricewriter 2 · 0⤊ 0⤋
From all I have learned from Judge Judy and others, get every single person on the lease. Otherwise, they split up and the person is left with their portion and what they were getting from that significant other.
Fiance seems to be the politically correct word that people are living together as a couple without the legal commitment of marriage.
Yes, get an application fee from each person and a security deposit. Why take the chance!!!
2006-09-30 13:31:19 · answer #3 · answered by banananose_89117 7 · 0⤊ 0⤋
Please read the other answers then do not lease to the people . You are leaving your self open to a major can of stink and manure. May be even a four way legal battle. Bad Deal.
Lease to One Married Couple who have money enough .
Make sure they have renters insurance prepaid before you give them the keys, then check monthly with insurance company still valid?
Increase your home insurances against any renter.
You could lose other house.
2006-09-30 16:33:51 · answer #4 · answered by Anonymous · 0⤊ 0⤋
This is trouble waiting to happen - it would be far better to wait until a qualified tenant comes along than to try to make these four people be a good fit for you. If you must rent to them, run all of their credit and background checks, and have each one on the lease.
2006-09-30 14:47:30 · answer #5 · answered by leezard 2 · 0⤊ 0⤋
What you should do is get new people to rent. You are looking for trouble. This people don't qualify and yet you are trying to justify what they want to do. I don 't know in what area is your house located, but i'm sure you will find the right kin d of people. Also you can give it to a Real Estate to rent it for you
2006-09-30 13:31:48 · answer #6 · answered by lm050254 5 · 0⤊ 0⤋