Real Estate Gladiators is an industry leader in the property management industry serving Issaquah, Bellevue, Kirkland, the greater eastside and surrounding areas.
Tenant screening isn’t something that all landlords do well. However, it’s incredibly important, and deserves your attention and investment of resources. The type of tenant you place in your property will have an enormous impact on whether you have a good rental experience or a giant headache. It will also influence the return you earn on your investment. Screen your tenants well, and make sure you know who’s moving into your rental home.
Consistent Tenant Screening Processes
It’s important that you have a process in place for tenant screening and that you follow it consistently. When you screen a tenant, you look at their backgrounds and you ensure that all of the information they provided on the application is true and accurate. This is how you decide whether you’ll approve them for tenancy or not. You have to be consistent and treat every application the same, otherwise you can be accused of discrimination. Put your screening process in writing, let your tenants know what you’ll be looking for before they submit an application, and follow your process. This is the best way to accurately and fairly screen each tenant.
Check Credit and Financial Information
Pull a full credit profile report and examine the applicant’s credit history. You can choose a credit score that’s required before an application is approved, but the full credit history is more important than the score. You’re looking for a record of responsible financial behavior and a willingness to pay rent on time every month. Things in the credit report that should alarm you include prior evictions, debts and outstanding payments to former landlords or property managers, and a record of late or unpaid utility bills. You should also use the credit report to verify current and past addresses.
Credit and identity theft is a problem affective a lot of Americans. Make sure you follow the Fair Credit Reporting Act; it’s legally required when you gather personal and financial information from tenants, and it ensures their data is secure.
Criminal and Employment Verifications
A nationwide background check and a review of criminal records is also necessary. Check employment as well. Call the employer and verify the tenant’s position, length of employment, and salary. Make sure the income meets your requirements. Most industry standards say that a tenant should earn at least three times the monthly rent.
Review the Past Rental History
Verify the applicant’s rental history, and talk to current and former landlords. Find out if rent was paid on time, whether any property damage was left behind, and if the lease terms were followed. Make sure the dates of residency match up to what’s on the application, and ask some questions that verify you’re actually talking to the landlord, and not a friend of the applicant’s. Look for past evictions or judgments and lawsuits that may have been filed against the tenant.
There are a number of screening tools that can automate and improve your process. Professional property managers have access to these through our sophisticated property management software, so it’s often a good idea to get some professional help when you’re leasing your home.
If you’d like to hear more about our screening process and how it helps us find the best tenants, please contact us at Real Estate Gladiators.