When a landlord is reviewing applications for potential tenants, there are several key factors one should consider. First, the landlord needs to make sure the prospective renter is a good fit for the property, someone who is a low risk, and has a history of paying rent in full and on time. Second, it is essential to properly screen applicants to avoid potential problems in the future. By doing your due diligence beforehand, you can get a better idea of the person or people who will be living in your rental property. Let’s take a look at what factors landlords should screen for when considering rental applications.
Pre-Screen Potential Tenants
Conducting a pre-screening process for applicants can be useful and save time. The pre-screening should provide you with a general idea about the person who wishes to lease your property. When they contact you regarding your rental property, it is a great idea to communicate the requirements during the initial conversation. You can also ask why the applicant is considering moving. Perhaps they have expectations from their landlord you need to be able to meet. Make sure the applicant knows about all rules concerning pets, roommates, excessive noise, smoking and even subletting. Before having anyone fill out an application, it is a good idea to ask about their expected move-in dates to ensure they align with when the property is available. Let the interested party know exactly what you will be checking so you don’t waste their time or yours having a potential tenant apply for a rental property they are not qualified for or that won’t be a good fit for you or them. Now, you are ready to screen the applicant formally.
Do an In-Depth Check of the Applicant’s Credit Report
Someone’s credit report can reveal a lot about their character as a tenant. Although it may seem easy to just look at the credit score to make a determination, it is helpful to dig a little deeper with potential tenants. Landlords should be looking for items such as an excessive amount of late payments and judgments when deciding whether to rent to an applicant. If the credit report contains any of these items, the landlord should be concerned. Keep in mind, however, not everyone has perfect credit. Know ahead of time which items you will consider being “red flags.” It is always possible someone has hit a rough patch in the past with an item such as medical bills. If this is the case, often times a simple explanation from the applicant can clear up any issues. It is definitely possible this person will still be an excellent renter.
Verify the Applicant’s Income and Employment
While there is usually a place on the initial application for the potential tenants to indicate their income as well as a place of employment, you should always be sure to verify this information. The landlord should always contact the applicant’s employer to get an employment verification. Ask the employer about the length of the applicant’s employment as well as their character as an employee. If you are finding that the applicant has a mediocre job history, such as that they have trouble holding a job for an extended period of time, it may be a cause for concern. When considering the applicant’s salary, abide by the “Three Times” rule. Typically, the applicant’s after-tax salary should be equal to three times the monthly rent. Ask the potential tenant to supply his or hers two most recent paystubs, W-2 forms, or tax returns. In certain cases, such as if the person will be starting a new job in the area, a letter from an employer will suffice.
Conduct a Criminal Check
A landlord should always conduct a criminal background check for potential tenants. This is a strong indicator as to what type of resident the tenant will turn out to be. It is important to take the results of the criminal background check into consideration when it comes to possible damage to the property, as well as the safety of neighbors and other renters. If you find the applicant has been convicted of a felony or many misdemeanors, you may want to reconsider renting your property to them.
Ask for References From Previous Landlords
Always ask a potential tenant to provide at least two references from previous places they have lived. Prior landlords should be willing to provide any information that is necessary, such as if the tenant paid their monthly rent in a timely manner, if they broke the lease, or if they created any sort of problems while they were occupying the leased property. Find out if they will be good renters by asking if the prior landlord received any complaints from neighbors regarding the behavior or the applicant. Ask about the length of the tenancy, if they maintained the rental property, and even if the past landlord would consider renting to this person again in the future. If necessary, a landlord can check for any previous evictions by checking the applicant’s court history.
Ask for Personal References
It is a good idea to ask potential tenants for at least two personal references before you will approve their application. While this may seem excessive, it helps you to get a better understanding of who will be living in the rental property, saving you from the unpleasant experience of having tenants who do not abide by your rules. These references can be co-workers or even past roommates. By going the extra mile to check personal references, you can save yourself time and even money by ensuring you have the best renters possible.