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How to Effectively Screen for Quality Tenants

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A good tenant is every landlord’s dream. But as they say, good things are usually hard to come by. Finding a good tenant takes skill, experience, and determination.

By renting to a desirable tenant, you can rest easy knowing you’ll get paid at the end of the month, your property will be cared for, and that the tenant is much likely to rent long-term. A bad tenant, on the other hand, may just mean the opposite, if not worse.

So, how exactly do you do to find a good tenant? Well, while it involves doing a ton of things, it isn’t exactly rocket science. To find a desirable tenant, you need to screen each and every prospective tenant for various things. If it’s too much work for you, Upkeep Media Inc., a property management marketing company, recommends hiring a property manager to do it for you.

Here is what the process generally entails.

1.   Require tenants to fill out the rental application

Always require that all prospective tenants fill out a rental application form. These are easily available. You can get a sample online, create one of your own, or get one from your local real estate association.

Just make sure the application form asks as much information from prospective tenants as possible. Ideally, you want one that encompasses things like the tenant’s personal, employment, and financial information.

You also want a form that plainly states that a credit check, criminal history report, or a background check is mandatory and that the tenant grants authorization for these checks.

2.   Run a credit check

Landlord-tenant laws differ when it comes to how landlords should conduct a credit check. In some states, you may be required to foot the entire bill of running a prospective tenant’s credit check. In others, the cost of ordering a credit or background check lies squarely with the tenant.

Either way, it’s not a process that any serious landlord can afford to overlook. You can order a credit score or a credit report using the Equifax Identity Report. Basically, the report will help you know the tenant’s previous credit history.

When reviewing the report, you want to check for things like collection accounts, history of late payments, and even bankruptcy. If the tenant has several unpaid balances, carried hefty loans, or maxed out their credit cards, rent payment issues may be inevitable.

3.     Run a background check

Magnifying Lens Hovering Over a KeyboardThe other thing you want to do when screening potential tenants is running a background check on them. You can use the tenant’s social security number to order their credit, criminal and eviction history, as well as other various public records.

ScreeningWorks and StarPoint are some of the online companies that you can hire to do this for you.

When analyzing the findings, pay attention to some potential red flags. Has the tenant been sued for serious financial matters like unpaid child support or unpaid rent? Does the tenant have a lengthy or serious criminal record? Has the tenant been recently evicted?

4.     Contact the previous landlords

Dark Silhouette of a Young Adult Sitting in a CafeContact the previous landlords to get a real sense of the tenant. Don’t just ask the landlord whether they are aware the tenant is moving or if the tenant paid rent on time and hang up. Dig a little deeper than that.

Find out about other things like whether the tenant:

  • Owes any outstanding debts
  • Has a history of late payments
  • Caused any careless or negligent property damage
  • Has a history of disturbance

And more importantly, whether they would consider renting to them again in the future.

5.   Verify the tenant’s employment status

Rent is the lifeblood of your rental investment. As such, it’s in your best interest to hire a tenant that has a steady and reliable income. Now, there are two ways of doing this.

One, you can ask the prospective tenant to give you a copy of their recent paystub. Or two, you could contact their employer directly to verify the tenant’s claims.

While not all employers may be willing to share their employee’s private information, they can tell you whether the tenant is an employee or not.

6.   Interviewing the prospective tenant

One Individual Interviewing Another in an Office SettingLast but not least, you also need to interview the prospective tenant. A quick phone interview usually suffices. Here, you want to learn a thing or two about the tenant’s lifestyle. The following are some of the questions you can ask:

  • Are you a smoker?
  • Are you ready to pay all the move-in costs?
  • Do you plan on getting a roommate sometime in the future?
  • Do you have any pets? How many do you have and what’s their size and breed?
  • How many people will be living with you?

In Conclusion

By screening every prospective tenant, you can drastically improve your chances of landing the right tenant. Be careful, however, not to discriminate on a tenant based on their sex, religion, race, national origin, family status, disability, and color.

We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. See Equal Housing Opportunity Statement for more information.