Finding good tenants is a must for any landlord who wants a reliable rental income stream. By ‘good tenants’ we mean those who pay rent on time, don’t cause trouble with the neighbors and who will take care of your rental property like it was their own.
That’s why tenant screening is such an important part of the rental application process. Tenant screening includes three crucial elements – a tenant credit check, tenant eviction screening and also a tenant criminal background check. Neglect anyone of these and you could end up with a tenant horror story and no one wants that.
Here are 5 benefits of tenant screening so you can get the right tenants for your rental property.
1. Know they can afford to pay the rent
When you sign up a new tenant to rent your property, you need to know that they can cover the rent. Therefore, ordering a copy of their credit report is important as it provides an instant tenant credit check.
Using credit scores to rank applicants is a good way to prioritize if you have a lot of potential tenants. But you should also look at their payment history in more detail for a more thorough tenant background check.
Do the applicants have a large amount of credit card debt? Have they defaulted on any loan payments? These are things that can help you make an informed decision about who will be a good tenant and who will not.
2. Know they will be able to pay on time
Knowing your tenant can afford to pay is one thing, but trusting they will pay on time is another. The last thing you want is a tenant who makes promises to pay the rent but is consistently late and has to be chased up.
Ideally you want a tenant who always pays the rent on a certain day or date of the month without fail!
Their credit report will indicate whether a collection agency has been hired to help collect unpaid rent. It will also show any judgments by previous landlords for successfully suing the applicant for unpaid rent or damages.
Also check out references from previous landlords, and employers, as they can help confirm how good the applicant is at paying rent on time, and their character in general.
3. Know that your property is protected
It’s important that your tenant verification services include a check whether an applicant has a criminal history. Although the chance of an applicant being a criminal is small, it’s still good to do a tenant background check to make sure.
Even if something does show up, it could be something minor, like a traffic misdemeanor, that you’re willing to overlook. A drug conviction or time in jail may be harder to overlook and you’re right to be concerned if someone has this kind of record.
At the end of the day, you have to feel comfortable that you can trust the person with your property, that they’ll pay the rent, and that the neighbors are safe.
4. Avoid evicting a tenant
No one wants to evict a tenant. Apart from the lost rent it’s a stressful and emotional undertaking that is best avoided.
Only monetary judgments show up on the credit report, so you’ll need more detailed information, such as an eviction report that shows any court orders filed by a landlord or warrants of eviction. Many online reporting agencies can provide you with an eviction report quite easily. Getting one from the outset could save you a lot of time and money.
5. Feel confident you’ve chosen the right tenant
If you take the time to do tenant screening you’ll sleep better at night because you know you’ve chosen a great tenant, and you’ll have the paperwork to prove it. The peace of mind that comes from this is invaluable.
Trusting your gut may work some of the time but it’s not always reliable. Applicants might be on their best behavior and give you all the right signals so you’ll like them. Later if they refuse to pay rent on time, try to scam you or damage your property, then you’ll have no solid evidence to back up your decision.
Tenant screening, on the other hand, will give you multiple sources of information to make an informed decision. Even if it does take longer, and cost you a small fee, to perform the necessary checks, deciding not to screen potential tenants could be a much more costly and stressful mistake down the track.
Our guest author’s bio:
Angela Pearse is a blogger for Zumper who frequently combines travel with freelance writing. She’s passionate about Art Deco hotels, historical novels, Netflix, hiking and healthy living.