Screen tenants properly to avoid future problems

tenantriskverification July 10, 2012 0

At a recent training session, David Beattie, principal of Chorus Letting, a Cape Town agency that specialises in residential letting, stressed the importance of letting agents screening potential tenants properly.

Beattie advocates using a step by step process to qualify tenants and reduce the landlord’s risk.

“Problem tenants are often placed by the landlords themselves who frequently do not screen tenants thoroughly. If all the checks are done properly, it reduces the risk of having bad tenants move in.”

When prospective tenants apply to rent property, they should complete detailed application forms and include copies of their identity document or passport, bank statements for three to six months, proof of income and references from previous landlords. In addition to this, letting agents will conduct credit checks with the relevant credit bureaux such as TPN (Tenant Profile Network).

“We would usually use two main criteria in choosing a tenant,” says Beattie. “First, we check that all the information given to us ties up. There must be clear credit records, income must be high enough and the amounts on salary slips provided must match the bank statements. Also, the bank statements must reflect the rental payments going out on time each month and the references given must be good.

“Second, our experience shows that a good feeling about the person applying to rent a property is usually to be trusted. After many years in this industry I rely on both criteria being filled, if the facts seem good but we get a bad “feeling” about the person, the application will be rejected.

“The final decision rests with landlords, but we do try to advise them correctly and make sure that their motivation for renting to specific tenants are the right ones. It is sometimes better, even if the landlord is stretched financially, to leave the unit empty and wait for the right tenant than to pick the first one that comes along and later find he is not reliable or does not look after the property.”

He says professional agents realise that it is in their interest to choose decent tenants, who will care for the homes as their own, pay their rent on time and are good neighbours.

“Although the tenant screening process is not a guarantee that nothing will go wrong, it does help in choosing the right person,” he says.

“With the Prevention of Illegal Eviction (PIE) Act and the Consumer Protection Act now in place, it is important that the right choices be made before a contract is signed, as getting rid of bad tenants later is lengthy and costly. If cases do arise where tenants need to be evicted, it is important that the problem is addressed quickly and the landlord or agent must act at the first sign of any trouble. A good agent will notice immediately if rent payments have not come through or if there is a problem with the tenant, and will start negotiations to rectify matters. Proactive measures result in defaulting tenants leaving with minimal or no monetary losses for the landlord.

“Proactive rent collection generally makes eviction unnecessary, but if an eviction attorney is needed and if the agent has kept all correspondence with the tenant, it will make the case less complicated, faster and perhaps less costly,” says Beattie.

Source : sapropertynews

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