One of the most important aspects of being a landlord is the tenant screening process. You’re basically entrusting your rental property to a stranger. You'll want to put yourself in a situation where your property is likely to be respected.
If you’re able to screen tenants effectively, gaining a high quality tenant can be stress-free. This can set your rental property up for success, since having respectful, reliable tenants removes plenty of stress. There are a number of factors to consider whenever you're screening prospective tenants.
Successful Tenant Screening Strategies
The first thing to focus on when it comes to screening tenants is coming up with definitive criteria. How do you define a quality tenant? Good tenants typically have the following attributes:- Stable job: It’s hard to pay the rent consistently if a tenant is a chronic job hopper and only has short-term part time gigs. Ensure applicants have stable jobs that pay well.
- Excellent rental record history: A past record is one of the best ways to reveal if the tenant is responsible while living in another person’s property.
- Unblemished criminal record: For the security and safety of other tenants, a clean record is essential for a renter.
- Responsible attitude and timely payments: Even if a tenant earns a high income, slow or missed payments can still bog your income stream down. Paying on time is the hallmark of a tenant’s sense of responsibility.
How do you define a quality tenant? Outline your standards to help you find renters that fit your criteria.
Pre-screening Tenants
To filter the tenants who are serious about renting, you should first conduct pre-screening. You should state terms and requirements clearly so that prospects can quickly check whether they qualify. Pre-screening may also include meeting face-to-face to answer questions and provide more information. In your property listing, mention your requirements specifically to save time. It's a waste of time to meet with tenants who are actually not in a position to rent your property. Make sure to be transparent with the application fee too, so that expectations are managed. Before a meet-up, you can call a tenant and ask the following:- Reason for moving from their previous home.
- Schedule of moving into a new home.
- Monthly income and employment history.
- References from prior landlords and employer.
- Pet ownership.
- Smoking habits.
- Number of co-tenants that will be living with them.
Meeting Prospective Tenants
It’s ideal to meet your prospective tenants so you can detect red flags in terms of behavior. Some things to watch out for are:- Punctuality: Did your applicant arrive to your meeting on time? This shows that the potential renter has respect for your time.
- Level of interest: How interested is the tenant in your property? A disinterested prospect is likely to be indecisive about moving, which could turn into a time drain.
- Courtesy: A polite attitude may reveal that a prospect respects the landlord, acts with respect, and is easy to communicate with in terms of property policies. Is this applicant someone you would enjoy communicating with long term? If not, reconsider their viability.
- Responsibility over their belongings: If prospects exercise accountability over their personal belongings, they’re more likely to treat the rental property with care.
If the face-to-face meeting goes well, ask them to fill out a rental application form so that you can review .
Reviewing Rental Applications
Rental applications present the necessary data for a landlord to fully evaluate the suitability of a prospect. In the rental application form, specific information should be available, such as:- Contact information.
- Name and address.
- Names of former landlords and their contact information (preferably a 5 year history)
- Name, address, and contact information of current landlord.
- Current and past employers, job position, salary, and employment duration.
- Authorization for credit and background evaluation.
Verifying Tenant Income and Employment
Verification is crucial to find out if the prospect was transparent with the information provided in the application. You also need to reach out to references to ascertain the truth. Some prospects may embellish their income or work histories to be accepted as renters. Some may even deliberately submit fake documents.
Call a prospect’s employer to double check the tenant’s job position and duration of employment. Bank account statements, W-2’s and paystubs will help you measure if the applicant is capable of meeting the monthly rent.
Contacting Prior Landlords
Reaching out to past and current landlords will tell you more about your prospects. You’ll gain insight of the character and behavior of each applicant. Here are some questions you'll want the answers to:- Were violations ever committed (especially serious property damage)?
- Has the tenant ever fail to pay rent?
- Did the tenant maintain the rental property in terms of cleanliness and sanitation?
- Did the tenant display good behavior by living harmoniously and not becoming a nuisance?
Conducting Tenant Reports and Background Checking
To gauge if a prospect is financially responsible, check their credit score. Usually, a score of 680 and above is sufficient. It’s always best to analyze deeper and review if there’s any outstanding debt and record of evictions. Remember also to check a prospect’s criminal history. You wouldn’t want to unintentionally hide a fugitive. Crimes you want to watch out for in particular are records of assault, arson, and theft. Certain states have bans on criminal record checks of prospective tenants, so make sure that you consult with a legal professional who is an expert in landlord-tenant laws in Texas. Otherwise, you could be held liable and sued in court.Making the Decision to Accept or Deny Prospective Tenants
Once you’ve reviewed the entire application, you can then issue an acceptance or denial.
If you’ve decided to accept the prospect, you can arrange for a lease signing. If you decide to deny the applicant, then you can write a letter as proof of their application being denied.
Use this helpful guide to ensure your lease is comprehensive. Be sure to keep leases and all other relevant paperwork backed-up and well-organized.
