Did you know that, on average, a landlord has three properties registered to their name? Research also shows that only 45% of landlords manage their individual properties. The other percentage of landlords find a third-party property management company to handle the job.
One of the ways to effectively manage your rental property is by tenant screening.
Often, landlords think they can follow their gut about which tenant to allow to rent their property. Unfortunately, you may find that your tenants have become a nightmare to neighboring renters, causing you expensive evictions.
You can avoid all these problems using tenant background check tools. Here, we discuss why tenant screening is important for first-time landlords.
Understand Your Tenant’s Current Financial Circumstances
You must ask for a credit report from your potential tenant during the application process. Various aspects of the credit report may indicate red flags about the tenant failing to pay the rent.
Still, other items in the report are of less concern to many landlords. In most cases, landlords will be more than willing to overlook things like student and medical loans.
It can be hard to overlook aspects like the credit card debt of your aspiring tenant. Find out if your applicant has a significant credit history.
If not, you can protect yourself by requesting a co-signer on the lease agreement. That way, you’ll always get your rent even if your tenant cannot pay.
Determine the Likelihood of Your Tenant Paying Rent on Time
Most landlords admit that payment problems are among new tenants' top concerns. Your tenant's full credit report can help you tell if your tenant will manage to pay rent on time.
Also, find out if your tenant has a history of prolonged late rent payments. Perform tenant background checks by seeking references from previous landlords of your potential tenant.
It would also help to ask your tenant for their pay stub. This measure allows you to confirm that your tenant's proclaimed income is accurate.
Safeguard Your Property and Neighborhood
A full tenant screening process should also include a tenant criminal background check. If a tenant has a minor traffic violation or offense from many years ago on their record, you can choose to overlook it.
It’s recommendable to review your tenant’s criminal record on a case-by-case basis. This prevents you from renting to an applicant that’d put your rental property and neighborhood at risk.
Prevent Future Evictions
Tenant evictions can be a stressful and costly process you don't want to experience. Besides, these processes can take up to three or more weeks to complete.
Knowing your tenant's previous eviction story will help you avoid future evictions. Ensure your tenant's eviction report provides details on failure to pay rent and illegal detainers.
You can also look out for writs and warrants of eviction.
Tenant Screening Benefits
It’s only fair as a landlord to get tenants that pay rent on time. Your tenants should also respect and take care of your property as long as they stay in your rental property.
You can research the best tenant screening software for you. This will give you peace of mind and co-relation with your tenants.
Contact us for more help with your tenant screening processes.