Currently I am trying to pick the tenants for my condo in downtown Toronto ($2400 a month). There are two options:

  1. Two international students from university of Toronto, but they are only willing to rent till August, which means I would need to pay my agent fee (1 month of rent) again in September 2020 (less than a year).
  2. A 44 year old barber shop owner with 640 credit score and his 38 year old unemployed friend who just moved to Toronto from Ireland.

What would you recommend?

  • 8
    How hard is it to evict bad tenants in Toronto? – RonJohn Sep 26 '19 at 0:49
  • 2
    Can you elaborate on your question with how low or high '640 credit score' is for those outside of Canada? – li x Sep 26 '19 at 7:39

There's a 27% chance that someone with a 640 credit score will become seriously delinquet in the future. (Source).

Do a cost benefit analysis.

(Extra income gained by renting for the whole year and not paying an agent fee) - (0.27 x Potential cost/loss due to eviction) = ?

If it's greater than 0 then rent to the barber, otherwise rent to the students.

Could you charge the students a premium e.g. they have to pay the utilities, or you add 5% to the rental price because they're not renting for the whole year?

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  • 2
    You could also ask the barber to have someone with a better credit score co-sign their lease. – Dugan Sep 26 '19 at 15:32
  • Your source refers to the US score, OP talks about Canada. Or do they share the same algorithm? But, anyway, there should be sources about what means a 640 score in Canada wrt to the chance of failure. – glglgl Sep 27 '19 at 7:02

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