# Rental unit ... renting it out



## jamesbe (May 8, 2010)

So I bought my condo with a tenant in it, first time I bought an investment property so it was ideal for me at the time.

2 years later my tenants are moving out, they were awesome tenants so I'm sad to see them go.

So I posted up a free ad and within a few hours my phone was ringing off the hook, so I bumped the price on the ad  because everyone told me I was asking too little.

Any advice what to look for in a tenant? Tell tail signs they will be good or bad? First call was from a Teacher with a 9 year old son and his wife. Chimes of awesomeness went off in my head.

Second call was from a doctor's office, a young lady who said she likes the area and everytime a rental comes up it is gone instantly so she was keen. Third call was from a guy that well didn't sound very "normal". 

So those were easy ones, e-mail is a little trickier... had a few through that. I seriously was worried and didn't think I would get that many calls especially that fast.

I'm in Ontario -- I can get references, but how do I check credit etc? Thanks!


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## lewin (Jan 10, 2011)

The Landlord Forum and Landlord Rescue are great resources specific to Ontario. I've definitely seen advice about getting credit checks on LR somewhere...

(I'm a tenant, not landlord, but interested in this stuff.)


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## jamesbe (May 8, 2010)

Thanks!


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## mrcheap (Apr 4, 2009)

I wrote a couple of posts about my experiences finding tenants a while back...

As lewin suggests, Landlord Rescue is an excellent resource! The Landlord Self-help Center is good too.


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## Jungle (Feb 17, 2010)

I got my credit checks from http://www.tenantverification.com/ and the credit check sucked, it didn't show enough detail IMO and there was no credit score. But I did see three hits of collection agencies, (and the guy was making 100+K income), I said "thanks but no thanks." Too much risk for my liking. There is another service which can be found on the ontario landlord website, it cost about $16 or so for the credit check. Much cheaper than I paid, which was like $24 bucks. 


I would never post my phone number on the internet and I would only respond to emails and call who I choose. Usually you get a story written with the first email and you can kind of make a first judgment call from there..

When I call people, I go over all my expectations and then ask them if they still want to do a showing. Mainly my expectation was they must have pay stubs showing consistent full time hours, not contracted, part time or piece work.

I would not accept disability pay, welfare, school loans, government subsidy or other short temporary or risky incomes. 

I too had to increase my rent and add, as I received over 60 emails at one point. Marina ended up helping me and we adjusted the add to say that only employed tenants with good credit were wanted. This weeded a lot of undesirable tenants out. 

I rent in what they consider a "challenging area", where lots of people on welfare, no jobs or scamming EI, disability.


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## jamesbe (May 8, 2010)

Thanks for more info jungle. I'll look for that other service as well.

So far all the e-mails have been "Is it still available? And when can I see it?"

The calls more telling with a little explanation of what they wanted. I'm renting in a good area and the rent is reasonable enough that I've been getting decent calls so far.


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## Dana (Nov 17, 2009)

Here are some things that I do when I have an available unit:

I post a very descriptive on-line ad with photos. I choose a date and time that I will be showing the unit and give everyone the same date and time. This does not waste my time waiting for no-shows, generates a sense of urgency among potential tenants who are interested in the unit and adds an element of safety to the showing since I am usually alone. 

When potential tenants email you requesting a viewing or more info, email them back and insist that they phone you. It is too difficult to get a sense of someone via email. If they cannot manage to call you, you probably don't want them as tenants anyway. 

Make sure interested candidates fill in a rental application. Check their credit (I use TVS - already mentioned by previous posters). Check employment info and ask to see a recent pay stub (most recent so you know they are still employed) photo copy photo ID. 

Make sure you have a good lease/tenancy agreeement. We were fortunate in that our lawyer (who is a landlord as well) gave us a copy of the one he uses. 

Do not accept excuses as to why someone may or may not have first/last month's rent available and why they need more time or a payment plan. 

Be wary of any tenant who needs accomodation right away or is looking at the last minute.


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## lewin (Jan 10, 2011)

Dana said:


> Make sure interested candidates fill in a rental application. Check their credit (I use TVS - already mentioned by previous posters). Check employment info and ask to see a recent pay stub (most recent so you know they are still employed) photo copy photo ID.


Most of those were great suggestions but, honestly, if a potential landlord wanted to photocopy my ID I would get creeped out. I would certainly show my ID, but photocopy it? No way. I'm not sure why, but that crosses a line for me.

I mean, you're free to screen how you want but there is probably a balance between asking enough to weed out the bad tenants and asking so much that you scare even good tenants away.

My current landlords didn't do ANY of that when we rented here--just a tour and a short conversation. I'm a darn good tenant and so they lucked out; with their process they could have easily rented to a complete nut. They're really nice, so when I move out I am tempted to write them a short email on selecting the next tenants so they don't get burned...!


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## Plugging Along (Jan 3, 2011)

I just went through the process of doing this last month. I’m in AB, so don’t know if there are differences in the province. I always have a detailed ad with pictures, with my email and phone number. 

If they email me, I usually try to follow up with a phone call back to them telling them what the expectations are (1 yr lease, no smoking, no pets, must be willing to have a criminal and credit check, proof of employment, etc). I will set up an appointment for the viewing, and ask for their cell number, and that the call me ½ hour before they leave to confirm they are coming. I find this helps with the no shows, or if they are going to be late.

I do the showing, see what kind of vehicle they drive, how prompt they are with calling and showing up, etc. When I am showing them around, I generally ask them questions about what they do and get a pretty good understanding of the types of things they are interested in just by how they answer and what questions they ask. I do a lot by gut instinct. If they are interested, and I like them, I have them fill out an application. I tell them that if they are the tenants that I select, I will be performing a credit and criminal check, and will require photocopies of their drivers and SIN. If they do not want to give me a SIN, I will ask for a copy of their bank statement showing they have the money in their account. I also ask for a pay stub, or confirmation of employment, and the damage deposit, which is none refundable. I ask them if there is anything I should know about their credit or history because I would hate for them to lose their deposits. I’ve had a couple of people drop out, but most are fine. Once, I get this information, I will ask for the damage deposit and first months rent in cash or certified cheque. This is the point I sign the lease, and get 11 post dated cheques. To be honest, I seldomly do the actual credit or criminal check as most of the people that are willing to do the checks, and provide the information, and have the deposits are not high risks. We’re also in really good areas, where the rents themselves tend to weed out a lot of people.


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## lewin (Jan 10, 2011)

Here too, I would not feel comfortable providing some of this information, especially the SIN. The government recommends people not hand it out unless required by law. And what good does a bank statement do? Even if I have money for first and last, that's no guarantee the account will be refilled for next month. If the deposit cheque clears and you've already seen pay stubs, there is no need for a SIN or bank statement. What assurance do I have that you'll keep my information secure? Do you have a privacy policy? 

I would also be wary about your implication that you won't return their deposit if you reject their application. IANAL but I suspect that could lead to legal trouble. Every other landlord I've seen returns the deposit if they reject the tenant; deposits are only retained if the tenant drops out. 

You're in Alberta but the OP is in Ontario, so I'll mention that landlords in Ontario can ask for first and last but not a damage deposit, and can request but not require post-dated cheques.


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## Plugging Along (Jan 3, 2011)

I know some people are not comfortable giving out the SIN, so I am a little more flexible to with that, hence the bank statement and pay stub. The bank statement or the SIN is handy if you ever have to go into collections. I actually do have a privacy policy, I'm not sure how enforcable it is, but the fact that I have one, made most people more comfortable. The bank statement does give you a little bit of insight in terms of what is coming in vs. going out, and how much savings they have. If they have $10000 sitting in there, I feel there is a lower risk, than someone that shows alot of charges and negative flow. 

I have never had to return a deposit once I have gotten it, as I also explain to them what I am looking for, and the mere threat that they could lose their deposit if they lie to me, is usually enough to get those that are uncomfortable or undesirable to drop out prior too. I had one person admit to me about their minor criminal record and low credit score, and ask what the minimum was. That was enough not to take their deposit. Those who have good credit ratings, and no criminal histories general don't have problems. Again, I'm not sure how enforceable it is, but it has been an effective way to screen out people.

Post dated cheques are not required in AB either, but I still ask for them, and explain my reasoning, and they are happy with that too.


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## lewin (Jan 10, 2011)

That all makes sense. Given the high cost of a bad tenant, I certainly understand the philosophy (not articulated but implied by your process) that it's better to lose a few good tenants than to admit one bad tenant. Personally I prefer post-dated cheques too... for me the money is always in the account and then I don't need to worry about getting it to my landlord each month.


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## Berubeland (Sep 6, 2009)

Here's what I ask for, photo ID, pay stubs and I do a credit check. 

I recommend TVS for small landlords because they have no membership fee and they do a credit check. Jungle is right they are not as detailed as the ones I get but I pay $240 per year for Transunion and the about the same for credit checks. 

I do a lot of rentals and the real deal though is that I can usually tell before I leave the showing if I want them to rent the place or not. 

I don't like bulk showings because it gives me little opportunity to get to know and chat with potential renters. People just tell me stuff I listen between the lines so to speak. I want to know if they think their last landlord was an ******* or how they treat their kids and wife. Are they nice and easy to get along with. This is incredibly important when stuff goes wrong, like the dishwasher breaks and you have a hard time getting someone in etc. 

These are the questions you should know the answers to. 

http://landlordrescue.ca/top-20-questions-landlords-need-ask-potential-renters/

Questions that you should be prepared for when you place an ad

http://landlordrescue.ca/top-20-questions-asked-renters/


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## Plugging Along (Jan 3, 2011)

+1... I usually know if I want the person living there or not. I don't like the bulk showings, however, I do try to do multiple (2-3) showings with the same time frame, as they usually show up at slightly different times, and it does create a little sense of urgency. I do need help from hubby to help coordinate, if its more than 3.

I consider the tenents in similar ways as other relationships, I want each party to perform their role, be low maintenance, and generally there is a little give and take. I've had people 'complaining' about how they would like certain things changed, as a part of their negotiation, and will start talking about high the rent is, blah blah, then want the apartment. I won't rent to them, as I'm not sure what else they will ask for when they are there.


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## jamesbe (May 8, 2010)

Great thread! Thank you all!

I have 5 showings today. I booked them like I booked showings when selling my house 30 minutes apart that should be plenty as the place is really small. I'll read over some more of the material provided today before the first showing.

I got a feel from the phone calls who I want and who I don't but rather an in person meet to verify.

After 10+ calls I had one say "Is the rent negotiable?" I said sure, anything is negotiable but I have a lot of interest. So really it's not very negotiable haha

I've come to realize it's more like a job interview than a selling exercise. Where as selling a house, you don't care who buys the place, if you have the money take my house I don't care. But this is more like you are hiring a tenant, they are hungry for the roof over their heads and you have the final say on who you hire.


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## kcowan (Jul 1, 2010)

Plugging Along said:


> I've had people 'complaining' about how they would like certain things changed, as a part of their negotiation, and will start talking about high the rent is, blah blah, then want the apartment. I won't rent to them, as I'm not sure what else they will ask for when they are there.


We made an extensive list of demands before renting our current place. They agreed to many of them. And they explained why they rejected the other ones. This is, after all, our home. That was 14 years ago.


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## Plugging Along (Jan 3, 2011)

I find there is a fine line between complaining, making unreasonable demands, and trying to make the place like 'home'. I always tell the potential tenant that we want them to make this home, and are willing to pay for all the materials, and they supply the labour (I also tend to pick 'handy' type people). If I think they have long term potential, I am also willing to make more concessions. If it's something that is a need, I will always have it fixed, if it's a want, I will usually negotiate that changes will be slowly made over time, so not to put out a large chunk of money at one time. One person wanted a full security and home automation (they were in the industry). We paid cost for the materials, and he put it in. He's also done a lot more to it, and we have accomodated him. He's heading on to 8 years. Another person, we thought he was going to be a short term, as he was really demanding the in beginning. However, he was handy, and was constantly asking to make improvements, he's now at 18 years and going. (I was pretty proud of that one, because that was the first time I had to handle a rental all by myself). 

I find that there are certain 'profiles' that have a higher chance of staying in certain areas for certain reasons, just as there are certain people that you can tell are more transient, or looking to move up really soon. I tend to work really hard in trying to 'sell' to those that I think will be there for a while. I can often flush out the difference, though it's possible that I have missed some good opportunities


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## jamesbe (May 8, 2010)

Well first showing a student looking for 2 more students to share -- X

Second showing a couple, late 30's with a young son  Very nice ppl.


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## Cal (Jun 17, 2009)

I have seen ads that state they want you to bring a credit check w you (equifax or transunion) w you when you apply for the unit in person.

It is a reasonable thing to request.


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## Jungle (Feb 17, 2010)

Cal, I had some tenants bring their credit report to me (with pay stubs, account history etc) and I thought that was very impressive.

Also, I would go with a small family or working couple over a rooming house filled with students. You can just hear it now. Sarah didn't pay her share of the rent because her OSAP is maxed out, and to the other roomates, "it's not their problem."


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## jamesbe (May 8, 2010)

Had another showing this evening, very promising! It's pretty obvious if you talk to people for awhile, one couple wanted to rip out walls, change carpet etc. Too demanding for me!


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## donald (Apr 18, 2011)

I would second passing on students,im not a landloard but have had alot of young people(students)employed.

My bet if you took on a students:they would come out of the gate all good,but would start working on you if your not prepared testing boundries,things would start to slide you will get into a wired passive aggressive thing with your rules,they will act like they care but they dont,dont go there if you dont have too just my opinion unless your use to younger people.Im not a landloard thou so it might be abit different.


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## Plugging Along (Jan 3, 2011)

I've had students, they weren't my first choice, but they were actually pretty good. However, they were sisters, came across as very responsible, and their father was willing to co sign and vouch for them. I have also decided that students/young people in which their parents come out with them have been really great. My best tenant, who just left, had come out with her father from out East when she graduated. You could just tell by both their questions and relationship that she was raised really well, and was really reliable. He gave me his direct number, and said if there was ever ANY issues, to call him, and he would have a talk *lol* I do find students don't tend to stay as long. What I have done is I stipulate in the lease that I will only have one from them and list who is the main one. If there any issues with any of them, I will go after all of them, and evict them all, so haven't had any problems. 

I actually like younger couples that have at least one kid in school (not necessarily a teenager). They tend to stay longer because they don't want to move their kids around. My parents have had serveral that have stayed over 10 years each. Family with kids not in school yet, will often move just before they enter school, especially if you don't have a good elementary near by.


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## jamesbe (May 8, 2010)

Well that was easier than expected....

I have a potential tenant dropping off a deposit tonight.

Once I clear them I will draft a lease etc. Should I collect the full amount (first and last) when the lease is signed or when they move in? I figure probably when the lease is signed makes the most sense right?


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## Plugging Along (Jan 3, 2011)

Congrats. I would do it when it is signed. I ask for the rest of the checks when they move in.


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## Cal (Jun 17, 2009)

First and Last on signing.


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## jamesbe (May 8, 2010)

Back to the start again 

Prospective tenant called Hydro, apparently my current tenants are electricity hogs. Last bill was $450! So she got scared away.

I asked my Tenant what was up she said she runs the dishwasher and laundry machine 2 - 3 times a day and likes it COLD.

ugh. So now I waste my weekend showing the property.


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## donald (Apr 18, 2011)

Tough break!if they went that far with calling hydro,you know they would of been good,im surprised they went that far,i would think the common renter isnt that forward thinking.

The part i dont get thou is why they are basing it off of your current tenant,power costs are across the board,does not make any sense.Must be something else that was not sitting right with them.


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## Berubeland (Sep 6, 2009)

I disagree with Donald on this one, the best renters are super diligent about things like hydro because they want to make sure they can carefully budget all their expenses. 

Not only that they've been burned big time before, as separate hydro meters become normal, that's going to be the way of it. 

Tenants are not impressed with huge hydro bills any more than home owners are.


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## donald (Apr 18, 2011)

Berubeland,thats why i was saying @ the top of my post "tough break,you know they would of been good''

Your a professional,so you know the most about these things(i read your blog,very good by the way)

Im just taking a educated guess the common renter is more occupied on there day to day affairs and lets face it,a vast majority are paycheck to paycheck,common workers,where home ownership aint in there grasp.

Im guessin 2/10 renters are going to do there due diligence regarding estimating hydro ect,maybe im basing my oponion on the lower end renters market instead of the upper end rental market,i dont know the details of the ops rental,neighborhood,price,sq ft,ect ect.


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## jamesbe (May 8, 2010)

She was a very smart woman -- unfortunate for me. 

Now I spend Saturday doing showings it seems like -- oh well. I'm not sure what my current tenant is doing because we own a 3000sq/ft home with central air and use A LOT less than they do. Crazy!


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## jamesbe (May 8, 2010)

So out of curiosity I called Hydro to find out what another unit in the building averages.

The other unit is identical to mine, 3 bedroom , 2.5 bath basement unit in the same complex. Their usage is on average $145 a month, my tenants are double that.

Wow


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## kcowan (Jul 1, 2010)

jamesbe said:


> So out of curiosity I called Hydro to find out what another unit in the building averages.
> 
> The other unit is identical to mine, 3 bedroom , 2.5 bath basement unit in the same complex. Their usage is on average $145 a month, my tenants are double that.
> 
> Wow


Any chance of calling the first person back with that data?


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## jamesbe (May 8, 2010)

Personally I don't like being a PITA.

I sent her a txt message to her cellphone. Of course it is possible she never gets it, but who knows.

I sent her the info as I didn't want to call her at work. If she calls me back great, if she doesn't I am not going to pursue as I have found once someone makes a decision and reverses it they tend not to want to flip back again.


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## Berubeland (Sep 6, 2009)

Sorry Donald I read too fast  

Thanks for complimenting my blog btw. You know the way to a woman's heart!


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## Jungle (Feb 17, 2010)

WOW how do you use $450'/month electricty???  That says nothing about the unit (unless someone is stealing hydro) and more so on the occupants usage. How many people are living there?


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## jamesbe (May 8, 2010)

2.5 people, 2 adults and a 2 year old.

Blows me away as well.


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## Jungle (Feb 17, 2010)

Ok we average less than $40 every month..two people. Better check if they have a grow op..


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## colossk (May 11, 2011)

Jungle said:


> WOW how do you use $450'/month electricty???  That says nothing about the unit (unless someone is stealing hydro) and more so on the occupants usage. How many people are living there?


Thats absolutely insane. We live in a 3500 sq foot house. My wife, 3 kids and myself. We have central air running 24/7 in the summer, a pool with the pump running 24/7 in the summer. We run the dishwasher at least one/day sometimes twice, We do Laundry every day, we have an extra freezer in the basement as well as a fridge, 3 computers that basically run 24/7 (I work from home) and my hydro bill for this year has averages about $150/month, 2010 I averaged 148/month

My rental property which is a dulpex has a family of 3 in 1 unit and a husband/wife in the 2nd unit. It's about 1650 square feet with central air and the hydro for that place averaged $315/month the last 12 months. The main reason for this being an electric furnace which will be replaced this week. I expect that will drop the hydro bill quite a bit ($50-75/month) as I was told it's about 2-3x the price to heat your home with an electric furnace compared to a gas furnace

Something's up with your tenant


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## jamesbe (May 8, 2010)

Jungle said:


> Ok we average less than $40 every month..two people. Better check if they have a grow op..


Haha they certainly do not, I've been there many times. I know we average around $70 a month in our 3000sq/ft home.

It's electric heat and I suspect they just crank it up!

Not sure how they manage high bills in the summer though I would expect the summer to be basically nil.


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