Renting out a property can be a fantastic way to make money or pay for an investment, however being a landlord can be a lot of hard work.
As a landlord you will need to be responsible for maintaining the property, collecting the rent, getting repairs done and ensuring that your tenants are not damaging your property. In most cases, the workload of a landlord is pretty manageable, but the job can turn into a real nightmare when you have a problem tenant.
When you take on the wrong tenant they can make being a landlord a living hell. You might have to deal with damage to the property, loud music, complaints from neighbours and other headaches. There are also tenants who do not pay their rent, leaving you in the lurch financially. Sometimes you even have to get the police involved to evict a problematic tenant, which means that you will likely have to give up on ever seeing the rent money that you are owed.
However, the more you screen your tenants in advance and carefully select a trustworthy person, the more of these landlord hassles you can avoid. You can choose someone who will pay rent on time and who will respect the rules of your rental agreement. You might think that it takes a lot of time to interview and screen your tenants, but it is much better to spend the time selecting a good quality tenant than to spend the time later dealing with the problems that a bad tenant has caused.
Here are some tips for choosing the best tenant for your rental property:
- Above all, the most important thing to remember is to trust your instincts. First impressions count for a lot, so when you have your interviews with your prospective tenants you will already have a gut feeling about whether or not you think they are respectful and trustworthy.
- Give yourself plenty of time when choosing a tenant. If you are rushing to fill the property quickly, you might make a hasty decision without getting to know a tenant enough and choose someone who is not the best fit.
- Ask your tenants for references from previous places where they have rented. These are easily faked, so make sure that you ask them for a phone number of a previous landlord that you can phone.
- You can also ask for an affordability reference for your prospective tenant from the bank, which will tell you whether or not the tenant is likely to be able to pay their rent.
- You might want to consider running a credit check on your prospective client. This will help you identify whether or not they have any previous bad debts. If they have an unpaid debt in their past it will tell you that they have a history of not paying for their expenses. Also, it will give you a warning that bailiffs might come to visit your property.
- Get to know your tenant in an interview by asking them some questions about their lifestyle. Do they like to have parties or do they spend many quiet evenings alone? Do they work the late or the early shift? Learning more about their habits and lifestyle will help you determine whether they will be a good fit.
- No matter how carefully you select your tenant, always take a damage deposit. Most deposits are around 50-100% of one month’s rent and if the tenant leaves the property in good condition when they move out then you will return the deposit. If the property is damaged, you can retain the deposit and use it to pay for the damage.
These are just a few ways that you can avoid landlord hassles by carefully screening your tenants.
As well as having landlord property insurance, it is also important to screen your tenants carefully. Here are some tips for selecting the right tenant.
This article originally appeared on smallbizcounseldaily