Screening tenants is a critical part of effectively managing your property. The tenant you choose will have a dramatic impact on your success as a landlord and the type of rental experience you have. Follow these best practices for a thorough tenant screening process.
Establish your Tenant Criteria
Put together a written list of rental criteria, and provide it to any potential residents who are interested in filling out an application. You can include a minimum credit score, minimum income, and any other standards that tenants need to meet in order to be approved to rent your home. When you can document your rental criteria, you’ll save time. Tenants won’t apply if they know they aren’t qualified. And, you’ll be able to keep your screening process consistent and fair, ensuring you don’t accidentally violate any fair housing laws.
Check Credit and Financial History
You want to understand whether your applicants are good credit risks. So, you should pull a credit report and take a look at the prospective tenant’s debt. You don’t necessarily need someone with perfect credit, but you do need a tenant who is responsible with housing payments. Look for prior evictions and beware of any applicant who owes money to former landlords and property managers.
Income verification is also necessary. The standard best practice is to require that your tenants earn at least three times the amount of the monthly rent. So, if your rent is $1,200, you’ll want income that is at least $3,600 per month. Verify this income through employers, or ask for proof through pay stubs, bank statements, or tax records.
Background Check and Rental History
Spend some time doing a background check on your applicant. Check criminal histories nationwide. Verify their rental history and talk to current and former landlords. Ask if the tenants were responsible and if the landlord would rent to them again. Ask if any damage was left behind, if proper move-out procedures were followed, and if they had any pets.
Many landlords make the mistake of simply running credit and asking for identification. To effectively screen a tenant, you need to spend a little more time than that, and you need to be willing to verify everything that’s provided on an application. Most applicants are honest and forthcoming, but you don’t want to miss that one tenant who is providing false information and trying to hide an eviction or some kind of trouble in the past.
If you have any questions or need any help with screening, please be sure to contact us at The Wright Choice Richmond Realty Group. We’d be happy to help.