Many of us have had difficulty in rejecting interested rental applicants for our properties. Without a system to save you from legal entanglements, wasted time and aggravation, hurt feelings and embarrassment, you are going to be one unhappy and unsuccessful camper.
Having a legal and effective approval and denial system for your rental application process is essential if you are going to last in the landlord business.
Because every situation and applicant is different, it is best to have more than one method of rejecting an unwanted applicant. Unwanted applicants can vary in levels of unacceptability.
- Totally Unacceptable (credit or other reasons)
- Unqualified, but can become qualified (co-signer or large deposit needed)
- Qualified, but you have someone else more qualified
3 Ways to Reject a Tenant Applicant
The LPA Denial LetterEver have a hard time turning down applicants because they think it's their right to have your property because they need or want it?
As long as your reasons are legal for not approving their application, (By not breaking any laws regarding discrimination, etc.) you should not feel obligated to accept a tenant you determine is not qualified. For example, your decision to reject an applicant may be based on income, credit, stable employment, etc., while it may not be based on a person's race, sex, religion, etc.
You can protect yourself with a denial letter to inform the applicant that their application was not approved. Check off the appropriate reason(s).
The LPA Denial Letter provides a checklist of 12 reasons to select for the rejection of the applicant. Some of these include:
- Rental price offer not accepted
- Unable to verify or insufficient employment
- Credit history
- Tenant Lied on application
- Incomplete application
No applicant is happy to be rejected, but the LPA Denial Letter when needed, helps you manage your time more efficiently, rather than being bothered by complaining rejected applicants. It also gives the applicant a courteous, detailed explanation of why he was declined.
Adverse Action Letter
If you reject an applicant because of negative information on his credit report, an Adverse Action Letter is needed to comply with FCRA (Fair Credit Reporting Act) regulations.
The Adverse Action Letter includes the contact information for the consumer credit reporting agencies that played a role in the decision of rejecting the applicant based on the contents of his or her credit report. This form is included in the download of the LPA Denial Letter.
The Non-Rejection Rejection
One of the methods of not accepting a tenant I also consider is simply not rejecting them. From the outset, I feel it is important to make the applicant understand that there are other applicants also being considered and that we (management) will make our decision based on the best qualified application.
Isn’t it much easier for a person to accept that they are “still being considered”, even if it is not for this particular rental for which we’ve already found someone else “more qualified”?