Tenant screening is one of the first and the most important steps while renting your property. If you’re managing a property business, tenant screening can be a tedious task, and if done wrong, it can lead to troubling consequences. Getting that ideal tenant is not always possible. Even if all the documents are free of blemishes, you might end up running behind them for payments every month. You should also make it a point to adhere to the Fair Housing Act before screening tenants for your property
Avoid bad residents by following these top tips to screen your tenants and stay risk-free.
Why is it mandatory to screen tenants?
Tenant screening is essentially the first step to finding out whether the incoming tenants are the right fit for you. Doing so will keep property damages and legal actions at bay. When screening potential tenants, you find out if they have a stable job to pay rent regularly or not.
Did you know that around 468,000 were evicted in the last year alone? And if your potential resident falls under that, you might want to keep a close eye to avoid losses. Here is what you can do to stay away from such tenants.
1. Review credit history
A credit score determines if the tenant pays rent on time or not. Conduct a thorough check on their credit history and see if they have a poor credit score. Sometimes, they tweak the credit scores and submit false information to get past the screening process. Watch closely to such reports and take necessary actions.
A poor credit score can mean the tenant delays paying on time, have an eviction history, or have large amounts of debt. In all these cases, it’s you who will have face adverse consequences later on. Checking credit history is a necessary first time to see if they are reliable.
2. Background checks
Background checks determine any underlying problems beneath the surface. It’s a little more extensive than checking credits, in fact-checking credit history is sometimes a part of the background check. You need to check their address history, employment history, criminal records, public records, eviction records, full income, and credit scores here. This year, to keep the businesses steady, the CARES act was introduced to retain the properties.
There may be instances where there would be differences in the mentioned and the actual income, but you can uncover it during this stage of tenant screening. Background checks are a crucial part of the process that should be done extensively.
3. Triple-check rental application
Avoid costly mistakes by verifying rental applications in your screening process. Rental applications need to be complete with accurate information and ensure the tenants have gone through all the terms and conditions before signing. Check for incomplete applications or incorrect details in the form. It may be a total red flag if they deny the false information mentioned. Keep in mind to not discriminate against a tenant during the process, no matter what.
4. Check with former landlords
Contacting former landlords unravel the true character of your future residents. Some landlords cover up for the tenants and avoid the truth, and trying to find out whether it’s true or not can be hard, but you can go with your instincts if you find something suspicious.
You can also check with at least two to three landlords and see if they say the same about the tenant. Checking with two is always better than sticking to just one. Get the contact information of the landlords by asking the tenants and dial them up.
5. Conduct an interview
Finding profitable tenants is not enough; they should be reliable too. Keeping the property and other tenants safe is of prime importance, and conducting interviews can help you learn about the potential tenants better.
Ask about their short-term and long-term plans and find out if they are looking to stay for a long time or not, as you know how looking for new tenants frequently is a daunting task. Ask questions during this stage and see if they are the perfect fit for you. If you feel uncomfortable or have a strong gut feeling about their behaviors, you can reject their application.
6. Verify their jobs
Talk to employers in the organization and learn about your potential tenants in the Workfront. Find out if they are someone who is always late to work or who is on time. Ferret out the little details as they are the ones that matter a lot when it comes to renting out your property.
Efficient time management, trustworthiness, and reliability are the three things to look for. How your potential tenants are at the professional front determines how they behave with you. It’s what defines them on the professional side and as residents.
7. Run a quick check on their current home
You can conduct interviews, run background checks, and talk with landlords, but there’s no better way to learn about your potential residents than visiting their current place. You can say that you will be dropping by for a couple of minutes during the weekends for some paperwork and learn about their surroundings when you do so.
It’s one of the best ways to spot warning signals. See if they live with other roommates or have a pet they haven’t mentioned in their application and observe how well they have maintained the property.
8. Watch our for red flags
Some property seekers seem overly friendly and try to build a sense of trust in their first meet with you. You may think they are the ideal tenants you’ve been looking for, but don’t let your guard down. Notice any subtle changes in their behavior and go with your intuition. It’s your property above all, and to protect future consequences, never miss a single step in the screening process.
9. Check with references
We have listed about checking with former landlords and employees in the organizations. You can also contact the tenant’s roommates and other personal references if you get to know them better. Do not rely on one source. Always ask many people before renting your property. You may uncover more details as you talk to more people.
10. Have a clear written agreement
Keep all the documents safe and have a written agreement signed by the tenant to avoid putting yourself in bad spots. Follow the tenant-landlord laws in each locality to avoid getting accused by the tenant.
List out the terms and conditions clearly in the papers and get them to sign them for better property management. You can automate the tenant screening process for better efficiency using Yardi Screenworks Pro or MRI resident screening to fasten the process and reduce costs.
Manage tenants with Assetsoft
Screening tenants can be one of the most exhausting tasks, but you can handle the entire process seamlessly with the latest technology and tools. Assetsoft helps manage the whole process of screening potential clients with software like Yardi, MRI, and others for a hassle-free business.
We also help our clients with back-office accounting, tenant portals, lease abstractions, and overall property management.
Looking for ideal tenants for your property? Contact Assetsoft today!