There is an increasing number of accidental landlords in Scottsdale and Phoenix right now. What many prospective tenants do not realize when shopping for a place to hang their hats for the next year or two is that the new landlord might be on unstable footing. Unable to keep up with mortgage payments and unable to sell, leasing the home is becoming the trendy way to staunch, or at least slow the bleeding for many struggling homeowners.
The tenant will not bat an eye at the proposition of completing the requisite application, credit and background checks as an integral part of the approval process.
Is it time for landlords to be examined under the same microscope?
A renter stands to lose a great deal if the home they are living in falls into foreclosure. Should the landlord stop making the mortgage payment due to inability or lack of motivation, the tenant can be unceremoniously bounced into the street by the bank. Leases do not survive foreclosure. An unscrupulous landlord might simply pocket the rent while waiting for the bank to come for the property that is worth tens, if not hundreds of thousands less than the current note.
As such, it just might behoove tenants to begin investigating the financial situation of the person they trust to maintain the inhabitability of the home. While credit checks and bank statements of the homeowner are not likely forthcoming, foreclosure status and additional financing information regarding the property is generally available through the county treasurer. Public record is not bulletproof, but it should be scrutinized as a part of a tenant’s due diligence.
As the market evolves, so too do the caveats to one’s emptor.
Tenants have been asked to pee in a cup for years. Maybe it’s the landlord’s turn.
