How do you handle an applicant that is a dud?

How do you handle an applicant that is a dud?

Applicant A has a credit score of 733 (awesome!)
Applicant B has a credit score of 520 (boo!)
Company policy is 650 or higher.

I know what our policy is in this scenario, but I'm wanting to find out what your policy is to see if we should consider something else for our future policies.

We average them out

add and divide by 2?

See if the higher credit score income qualifies for unit on their own. Also obviously make sure they are ok

We average credit scores.

we only allow Applicant A on the lease

We use Rent Cafe/Blue Moon to screen. So the software decides. Usually when it comes back with bad credit, we do one of 2 things. They need a Guarantor, the guarantor (aka co-signer) must show that they make 5 times the lease amount. It’s 5, because we need to ensure can financially cover 2 households.
Or they pay a higher deposit. Which our software would decide as well. Could be $1000 or $2500.

You nee to have a credit score of 500+ for here it seems. If it is only credit effecting the screening then we offer the option for a guarantor

We average them out as well. We prefer to have anyone over 21 on the lease if possible .

If both are in the same application…Because of A it’s get approved. The lease is joint and severable so the burden is really on A to make sure rent is paid. They knew the risks going into this
Of course there are caveats such as bankruptcies , rental histories and such

I click a button and the computer tells me what to do. No fair housing problems here, and no having to explain or justify my decision making process.

I actually have the opportunity to override. I’d offer a months deposit on top of the initial deposit.

Decline the application…Credit scores are averaged for joint applications and theirs doesn’t meet the 650 requirement.
I’m guessing that they’re applying together to meet the income requirement as well so definitely not worth the risk.

Blending two credit scores is a terrible way of assessing ability to pay. If the one with the good credit score, has the income, has the good rental history it makes sense to approve them.
What if its a couple? the guy just partied too much in college and now he scored is marrying a Doctor who has the money? The lease is joint and several so ultimately A will be the responsible adult.

Choose the better qualifying applicant.

I would hire a company that does a screening score and stay away from making those calls yourself

We look at credit score, rental and employment history, both of which we want at least five years of to show stability. Credit score is a huge factor and we look at what is dragging the score down. Whether it’s medical bills or credit cards, car loans, etc. With that being said if applicant A is able to be the a lease holder on their own, we would put applicant B as an additional adult.

We take multiple things in to consideration; is it medical or student loan debt that is bringing the score down? How are their car payments; no late car payments well that's good. What's the history with the credit cards? Do they have a rental history; verify the rental history (I go to the assessor's page for the town to verify who owns the property if it's a private landlord and then purposely ask if they paid the wrong rent amount and provide the wrong number of years the applicant lived there to test to see if the person really knows the rental history). Then I look at income and how long they've been at their job.

I have a qualifying criteria sheets that clearly lays out everything that we look for to make sure there's no fair housing violations; I print it out for each applicant and put a check or "x" next to each line item. "X" means disqualified.