Statewide Enterprises, Inc. Qualifying Rental Criteria
As a general rule, the following are our company’s qualifying criteria in regard to approving prospective applicants. Be aware that many times if one or more of the qualifying criteria are not met we may still approve the applicant by requiring an additional security deposit. This is a very complicated decision and it can only be made by the corporate office and not by the On-Site Manager. Currently only the President and one specifically trained corporate office employee are authorized to approve any applicants. As Statewide is very conscious to avoid any perceived discrimination, decisionmakers do not view any photo identification attached to the application packages during their evaluation.
The following are our qualifying criteria:
1. Source of Income
An applicant can demonstrate a continuous source of income for at least the past 6 months and equal at least three times the monthly rent. The source of income should be considered permanent. If the source of income is less than three times the monthly rent but equal to or more than two and a half times the monthly rent, this will add an additional security deposit of ½ month to an approved applicant. If the source of income is less than two and a half times the monthly rent but equal to or more than two times the monthly rent, this will add an additional security deposit of one month to an approved applicant. This additional security deposit amount will be waived for a FICO score of 800 or above.
2. Prior Rental History
The applicant should have at least 12 months of rental history and be able to provide references such as the prior manager’s telephone number. We must be able to contact these references. Lack of rental history will add an additional security deposit of ½ month to an approved applicant. These additional security deposit amounts will be waived for a FICO score of 800 or above.
The applicant can have no evictions or unlawful detainer actions on their record during the past seven years. This would include even an unlawful detainer action without a monetary judgment. In general, an eviction would be an automatic rejection.
4. Criminal Background Check
If the applicant has committed a crime of a nature that can negatively impact a tenancy at our property, then such an applicant will be rejected due to this criminal history. We do not reject an applicant solely based on arrests, indictments, or complaints that did not result in a conviction. Conviction within the past ten years including, but not limited to the following crimes is reason for rejection: murder, burglary, assault, sexual crimes, manufacture or sale of controlled substances, arson, possession of illegal weapons, or passing bad or forged checks.
5. Credit Report & FICO Score
Credit history must be clean with no late payments, judgments or collection accounts with a minimum FICO Score of 720 (to qualify for the standard deposit).
If number 1 through 4 of the above qualifying criteria meet the required standard, then qualifying criteria #5 may be adjusted by an increase in the security deposit based on the guide below. This increase is in addition to the previous increases in the security deposit listed above. If total increases in the security deposit exceed two months, then applicant will be rejected. Note that collection accounts relating to utilities, phone service and rental properties are looked at more negatively than other collection accounts and may result in a rejection.
FICO SCORE REQUIRED
- 720 – Above Qualifying score (no increase in security deposit)
- 680 – 719 1 month security deposit
- 640 – 679 1 ½ months security deposit
- 580 – 639 2 months security deposit
- 560 – 580 Rejection or 2 months security deposit with qualified guarantor (see below if there is a co-signer)
- Less than 560 Rejection (no guarantor accepted)
- No Score 1 ½ months security deposit (assuming no collections)
- No Score w/collections: 2 months deposit (assuming all other criteria have been met)
- No Hit 2 months deposit (assuming all other criteria have been met)
When there are multiple applicants, we average out their scores in order to obtain the required deposit. For example, if one applicant has a score of 750 and the co-applicant has a score of 590, the average score would be 670, requiring 1½ months of security deposit. If one applicant has a score of 670 and the co-applicant has a score of 585, the average score would be 628 requiring two months security deposit. If one of the applicants has a No Score, then we use 640 as the number to average with the co-applicants score(s). If one of the applicants has a No Hit, then we use 580 as the number to average with the co-applicants’ score(s). Keep in mind that any time one of the applicants has a score below 560, regardless of the co-applicants’ score(s), this would still be an automatic rejection.
Using a Co-Signer
Some weaknesses in an application can be helped with a co-signer. A co-signer is someone who guarantees the agreement. In other words, they promise that if the tenant defaults in any part of the lease agreement, they will be financially responsible for whatever it takes to remedy the matter. If, for example, the tenant does not uphold their financial obligation, then a co-signer is also financially responsible for the balance. A co-signer can be used for applicants with low income, credit or both. To use a co-signer, the co-signer must complete the same application process as the main applicant. At the time the lease is signed the co-signer will be required to sign the lease as well. The co-signer will not be listed on the Lease Agreement as a tenant. Only a co-signer will a minimum FICO Score of 720 will reduce the applicant’s required security deposit and the reduction will only reduce an applicant’s increased security deposit by a half a month. However, a co-signer is not acceptable on any applicant that has a score below 560.