Super Awesome Tenant Screening Tips

Super Awesome Tenant Screening Tips
November 19, 2014

So you’ve started advertising for your property and have begun receiving calls. Your next step is to start screening your applicants. Screening can take a considerable amount of time – and you don’t want to waste that time on every person who shows interest in your property. This is why pre-screening is so important.

Pre-Screening:

Your pre-screening efforts begin with your property listing or ad. Whether you are using the newspaper, Craigslist, web listing, or another service to market your property – the information in your ad can help to weed out time wasters. For example, by placing the location in your ad, you are able to screen out individuals who are looking for another location. Putting the price in the ad also helps to keep those who can’t afford that price range from calling.

The initial phone call is the next step in screening. The first thing you hear is often an indication (though, not proof) of the kind of tenant they might be. When a tenant calls about a property you have for rent, you might ask them “What can I tell you about the property?” How the tenant answers might provide indications of the kind of tenant they are going to be. In the conversation, you can also always include a few minimum requirements. Example: The property has a minimum income requirement of $____ per month and we do a full background and criminal check to make sure we only rent to upstanding people.

This simple two-minute phone call does two great things – eliminates about 80% of unqualified tenants and prevents them from further wasting your time AND lets the eligible tenants know you are not a slumlord and only rent to good people.

Screening in Person:

The next step of screening is to meet with tenants and show them the property. This is also a great opportunity to screen the tenant before any paperwork is done. At this time, you might want to re-state your minimum requirements to the tenant in person – in case they didn’t understand (or chose to ignore) when you told them over the phone.

At this point, tenants that don’t quite meet your requirements will inform you, but might ask if you will work with them anyways. Even if you know immediately that they do not qualify, you should let them know why, but still offer them the opportunity to apply. Why? You don’t ever want to be accused of being discriminatory for any of the protected classes (race, color, national origin, religion, sex, familial status, and handicap).

Rental Application:

The application is your window into the tenant’s life. The following is a list of must-have sections to include and ask on your application:

1.Name, address, phone number, driver’s license number.
2.Social security number and date of birth.
3.Current & past landlords with contact info.
4.Current & previous employer with job details and contact info.
5.Have they ever had an eviction filed upon them or broken a lease?
6.Release of information signature.

Other good information to ask for: requested move in date, number & breeds of pets, number of felonies (if any), number of & make/model/year of vehicles, number of occupants, emergency contacts.

The Background Check:

A tenant’s credit report will contain a wealth of information related to the tenant’s credit history -including a detailed list of all the tenant’s open or closed trade lines (credit card accounts), car payments, monetary judgments, late payments, and more. This information can be overwhelming, but I recommend looking for the following items:

Credit Score: Depending on your criteria, you may establish a minimum credit score for your tenants.

Current and Former Addresses: Often times, a tenant may conveniently “forget” to list a past address. Verify that the addresses given by the tenant on the application match the addresses on the credit report. The credit report may not include all the addresses, but any listed should be verified. You can ask the prospective tenant about the addresses or simply do a look online for those addresses and (if it belongs to an apartment complex) you can call the apartment to see if the tenant ever lived there.

Public Records: This will list any judgments levied against the tenant (includes garnishments or evictions that have a monetary claim). Some landlords adopt a policy to never rent to a tenant with an eviction on their record, while others put a time limit on it such as “no evictions in the past five years.” This is a personal choice and depends largely on your risk tolerance level and the current demand for rentals in your area.

Calling Previous Landlords:

One of the most important things you can do to screen your prospective tenant is to verify their previous landlord. Generally, the way a tenant has behaved in the past is likely the way they will behave in the future. It’s not enough to simply call their current landlord – because many times, a landlord of a problem tenant will lie and give a stellar review just to get rid of a bad tenant. Always call their previous landlords as well. Also, keep in mind that sometimes a tenant will give you the name and number of a friend or family member – with the intention of that individual lying and claiming to be their landlord, just to give a positive review. To combat this, it’s a good idea to find the landlord or property management company on the web and see if the information provided to you by the tenant checks out.

When speaking with the landlords, there are a few questions you might want to ask:

•When were they an authorized tenant there?
•Were there any issues, late payments, NSF?
•Did you ever have to serve a legal notice?
•Did the tenant have any pets?
•Did the tenant give you proper notice to vacate?
•Would you rent to this tenant again?

You may find that some landlords will require you to fax them a copy of the tenant’s release of information (which you should have on your application) along with your questions to the previous landlord.

Screening Via Social Networks:

These days, people often put a lot information publicly on their Facebook, Twitter, Google+, or other social networking account than you would guess. You might be able to do a search for a potential tenant and see if there is any information that would aid you in making an informed decision. For example, a young couple applies for an apartment unit that does not allow pets, but upon checking their Facebook profile page, you discover that they have a brand new puppy that was not disclosed to you. You now know that you can move on to the next renter.

Whatever criteria you choose to employ when conducting your tenant screening practices, always make sure to keep them consistent. You do not want to be accused of, or subsequently sued for discrimination.

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