Apartment owners and property managers handling large numbers of rental units constantly face the hassle and risks posed by unpaid rent, criminal behavior, and other adverse circumstances. Dealing with these problems is inevitable, particularly for larger complexes, and the costs of tenant background checks, court costs and other lost revenues can take a bite out of a business’s return on investment.
Many properties require tenants to hand over a security deposit that is held in the event of property damage, unpaid rent, and other extra costs as outlined in the rental agreement. Properties also often use a tenant background check or other basic background checks to assess prospective renters. But even then, the task of managing security deposits and arguing with tenants over the validity of charges can be costly and time-consuming.
Rather than screening renters through basic tenant background checks and relying on security deposits to cover these costs — an unreliable system at best — property owners and managers can find more stability and peace-of-mind by investing in risk management services.
Good risk management practices analyze tenants in a variety of ways to identify low-risk opportunities and give property owners and managers a more complete picture of each prospective renter. In addition to standard credit checks, other useful risk assessors include evictions reports, fraud detection reports, and sex offender identification, along with a tenant background check and other criteria requested by each property.
Risk management companies also offer liability protection that works more efficiently than the traditional security deposit method, relieving both tenants and property management of the headaches accompanying security deposit issues. This can include accidental damage protection up to $3,000, unpaid rent protection up to $1,500, and pet protection up to $3,000.
Not only does this coverage provide greater protection than a standard security deposit, it also comes with more guarantees and fewer complications than that of a deposit. The comprehensive coverage of a risk management firm can let properties consolidate their support services, such as the tenant background check, into one source.
Over time, these risk management services pay for themselves by saving properties the time and financial costs that can be drained through tenant disputes. Many tenants will also appreciate not having to pay a security deposit while also knowing that the tenant background check is supported by so many other screening features, providing extra security to your apartment complex.
Source : microbilt