As a landlord or property manager, one of the most important steps you can take to protect your property is to screen prospective tenants. Not doing so can lead to tenants who may not pay their rent, or worse yet, destroy all of the hard work you just put into remodeling it. Whether it is slow rent or property damage, it is the property owner who will end up being the one to pay for your mistakes.
Forget About Keeping Your Properties Filled
As a landlord or property manager, one of your most important jobs is to keep your units filled. But, before you think about this, you need to make sure that any tenant you allow to rent from you is fully qualified to be in one of your properties. Which leads us right back to the screening process. The who idea behind this process is to learn the real truth about a potential tenant before you allow him to sign the lease.
However, if you are going to screen your tenants, you need to determine your standards before you get started. For example, consider these ideas:
- Household income at least 2.5 to 3 times the rent.
- Credit score that is at least 640 or higher.
- Solid rental record for the past 2 years or more.
- Maximum of 2 people per bedroom.
Good tenants expect you to have standards such as these and typically meet these standards with ease. Those who will not agree to this type of screening are generally not the kind of tenants you want to have in your rental units. While everyone deserves an equal opportunity to qualify to rent one of your homes, you have a right to ensure your homes are rented by those who will not destroy them or leave you with thousands of dollars in unpaid rent.
Make Good Use of Their Credit Report
Today, every landlord should run a credit report on every prospect tenant before allowing them to rent one of their homes. There is more at stake here than their credit score. A credit report can show you things like previous addresses. You can use this information to verify the previous addresses listed on their application. If there is a mismatch, you may want to dig a little deeper and maybe go to the county tax records and look up the names of the property owners. You can match also match these names to those provided to you.
It is up to you to become a super-sleuth when it comes to investigating any potential new tenants who have filled out an application for one of your rental units. The more time you spend investigating applicants, the less time and money you are likely to spend making up for all the damage, both physical and financial renting to the wrong type of tenant can cost you.