Tenant Verification to Reduce Rental Issues

tenantriskverification April 2, 2012 0

By Cindy

Tenant verification screening is one of the most critical steps for each and every landlord and property management company to attempt. Screening an applicant is the foremost way to determine if they may be a good credit risk for the apartment or community. Regardless of the number of apartment units that you have available for rent, you might want to utilize at least a number of the many different processes that exist to you.

The first thing you should determine is if you’ll screen all of your applicants yourself, or should you be going to use a resident screening company. If you rather not perform the approval process manually, there are numerous screening companies focusing on the apartment industry who, for a fee, can be contracted to complete at least part of the tenant screening process. Regardless of how your applicants are screened, you should make sure that the following items are evaluated.

1. Credit Check: Be sure that your application informs drug abuse that you will be checking their credit, understanding that they’ve signed off within this step. You will need to predetermine what your company philosophy is going to be in terms of how you interpret tenants’ credit histories. As an example, some property management companies tend not to count medical bills against their applicants. However, many organizations do have a guideline constantly in place that prohibits applicants from becoming residents should they owe money on the utility companies who service the community they are attempting to transfer to.

2. Landlord verification: This ought to be verified by sending a release form, signed with the applicant, to his current or previous landlord. Make sure you avoid asking questions that violate local and federal Fair Housing laws.

3. Employment verification: This could be verified either through pay stubs, a letter from the employer on company letterhead, or perhaps a phone call made to the employer.

4. Court records: Not every landlord or property management company undertakes this task of the verification process, most industry experts encourage it. Again, you’ll need to determine your company philosophy regarding which crimes are forgivable, which crimes are forgivable following a pre-determined number of years, and which crimes should never be forgivable. If you choose not to execute a complete criminal background check, you might want to consider at least building a sex offender registry check. Similar to the credit check, make sure that the applicant has been informed on paper that a criminal background check is part of the verification process.

tenant verification

There may be, of course, a cost linked to running a credit check plus a criminal background report. Some companies have a written rule available that they don’t chance a criminal check if the finance check fails to meet their specified criteria. Fair Housing laws, that happen to be applicable in virtually all rental situations in the United States, require you to screen your entire applicants in the same way. So after you have determined the process that you’d like to use, it’s crucial for you to use it across the board. If at any time you decide to change your screening criteria you have to document the changes, and also the date and time, in writing and keep a duplicate of it on file. This will aid if a Fair Housing discrimination suit is ever filed against you.

Owning rental can be a valuable investment. But once it comes to tenants as well as your premises, never judge a novel by its cover. You don’t want your investment to go up in smoke. Being a landlord or homeowner, you probably want to know beforehand in case a tenant is worthy of renting from you. Renting along with other individuals or families generally is a rewarding experience. However, the tenant chosen to inhabit the premises need to be reputable. You don’t want a tenant who might eventually end payment rent, damage the property, or engage in onsite illegal activities.

Similarly, you will need to make sure the tenant can actually afford the rent, the number of which should be just like rental rates in the community for the same type of home (by way of example, if the property rented is a 3 bedroom house, then your rental rate needs to be similar to the rental rates of other 3 bedroom houses in the neighborhood). Thus, you need to screen potential tenants to weed out the bad apples as well as folks who are not financially qualified.


To choose a tenant from the 3 applicants, the property owner must consider numerous things.

Credit worthiness: Has the tenant have you ever been part of a bad debt or ever declared bankruptcy? Would be the tenant’s credit history filled with negatives? Did the renter spend the money for previous landlord by the due date every month?

Responsibility: Did the wide ranging tenant keep his previous rental in good shape? Did he cause any damage? Was the best place left clean and in proper order after re-locate?

General character: Was the tenant excessively noisy at his previous place of residency? Did the neighbors ever complain? Did he have unauthorized pets or lessees? Has he engaged in a illegal or ethically questionable activities?

These are the 3 biggest categories that your property owner must evaluate. Any negative findings of these areas should generate a red flag.


So that you can protect your property, a credit assessment should be done to determine the individual’s credit history. The best way is to join an institution like National Tenant Network or Mr. Landlord. When you finally fill out an application and pass an onsite inspection, it will be possible to pull detailed credit history on applicants.

These organizations will likely allow you to purchase eviction reports and crime record reports by county or state, which is important as well. This runs specifically true in the case of a prior eviction, as folks who get evicted often repeat the pattern that got them into trouble again and again.

If you find questionable activity, you could get more information by going to your county or state court house. Many of the information regarding a lawsuit or crime proceeding is public, with respect to the area searched. Suits regarding damage to property, illegal activity, or non-payment of rent represent a red light in the renting process.

Statements from previous home-owners also bear weight such decisions. Contact the tenant’s previous landlord and verify the details on the rental application. Do not forget that some of these sources won’t provide information without worrying about written consent of the potential renter caused by privacy reasons.

Job references will also be helpful in making sure the possibility tenant is a good match to the property. Get copies with the last 2 pay stubs to make sure that income, and call the latest employer to verify the standard of the person. Previous and current employers can inform the property owner how their resources were chosen or cared for, indicating whether or not the potential renter is conscientious of the belongings of others. Consistent work habits and attendance tells the home owner that the potential tenant is responsible and takes pride with what they do.

Some renters will not be perfect in terms of their credit, job history, or previous rental references. Ultimately, it’s the decision of the property owner whether to rent to your given person. It doesn’t matter who you choose to rent your house, a periodic walk-through in the unit will serve to keep the renter in balance because you can look for damages and necessary repairs. Achieving this simple activity can assist ease the mind of the property owner no matter which tenant moves in.

By implementing a tenant background check program, you’ll be able to minimize future problems with your renters. In other words, what this means is to conduct criminal background checks on prospective tenants ahead of renting. Tenant screening adds a layer of risk management available for you by offering a snapshot of your prospective renter. Criminal record checks aren’t expensive and certainly cost far less than you might lose in unpaid rent, crime and property damage. It’s vital that you validate the honesty of the prospective tenant. You must find tenants who is financially responsible their rent on time, be respectful neighbors and observe after your property. Not only do bad tenants cost owners and managers money, their actions also can bring unforeseen liabilities. You need to understand if the tenant poses almost any risk. Background checks, which may include a criminal history, credit report, eviction search and references, are one of the quickest and easiest ways to reduce rental issues, like crime, property damage, drugs and unpaid rent.

When conducting a tenant verification, you will need to stay legally within and stick to the Fair Credit Reporting Act (FCRA) guidelines. By making use of tenant screening services, you can find out if prospective renters are who they say they are. And don’t forget, people and criminals take prescription the move constantly, which enable it to have a habit of leaving their “past” behind. Keep every one of these things in mind when you let a tenant transfer to your rental property. It’s well worth your time.

The volume of individuals who rent apartments, condominiums and single family homes carries on growing.

A background check offers protection from potentially risky tenants. The price of a single bad tenant is usually enormous, if one only considers the cost of eviction. Once a tenant occupies a residence it is a costly and frustrating process to get them out. But you will find additional risks home manager or landlord must consider. Fortunately, tenant screening is a viable and transparent activity that reduces the degree of risk one assumes when renting a property.

1. Protect Your premises
Malignant tenants may treat property with little respect or care. Expensive appliances could be damaged; carpet destroyed; fixtures vandalized: The list is extensive. The replacement or repair of a single appliance such as a dish washer, disposal or refrigerator is significant.

2. Protect Your overall Residents
Long-term renters take great good care of the property they have a home in and provide protection with the asset. One bad tenant could potentially drive away these valued renters. Oahu is the responsibility of the landlord to provide a continued safe environment for existing residents by checking the backdrop of any new renters.

3. Protect Your Reputation
Landlords wish to attract the most viable, long-term renters possible. If a property has a track record of high turnover, the ability of a landlord to draw these tenants is reduced. The very last thing a landlord wants is empty units. If your property has a track record of allowing disruptive and destructive tenants, that property is going to be increasingly difficult to fill.

Landlords and property managers may suffer that a tenant check can be an unreasonable cost. However, if an individual considers the potential decrease of property, current income from long-term residents and reputation, form possible cost of eviction, a tenant background check is usually a small price to pay.

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