by Sharon Vornholt
Everyone has their own method and criteria for screening tenants. Many folks use a formula that is a percentage of gross income to determine if they make enough money to qualify for the property. There will also be other factors such as length of employment and previous landlord recommendations. But the sad fact is that after all that due diligence, you may very well still end up with a tenant that doesn’t pay the rent and doesn’t take care of your property.
Perspective tenants often know just what to say; they know the “correct answers” to the questions. Tenants also give out false phone numbers for their previous landlord and current employer. So what can you do? There are several steps you can take.
Sorting Out the Truth in Their Application
When it comes to employers, I don’t like to call the numbers the perspective tenant “John Smith” gave me. For instance, if he told me that he works at Ace Electric, I would simply look up the phone number and call the company. I would ask the person answering the phone if John Smith worked there. On several of occasions I was told they had no employee by that name. If they verified that he worked for the company, then I would ask who their supervisor was and ask to speak to that person. Hopefully, that would actually be the person listed on my rental application.
I had the same process for the landlord. I wanted the company name. This was pretty easy to verify if they came from a big apartment complex. It was sometimes more difficult to determine if I was actually talking to their previous landlord if it was an individual that was the property owner. Asking the proper open ended questions such as, “can you verify the dates John Smith lived at your property” or “can you verify the starting and ending rents during the time this person was your tenant” would often trip up a relative or friend that was pretending to be his landlord. Be sure to call all of the persons listed as being previous landlords. You will often find that these folks were problems at many different places.
You can also often find the name of the owner of the property on the public records such as the tax assessors’ site. Another good place to get information is the National Tenant Network. This costs about $22.00 for the credit report and additional information, but it is well worth it. This report won’t give you a credit score, but you will get a good credit report. In addition you will get several years of rental history complete with names and numbers on this site if the landlord reports to them.
This process took a little longer, but I was able to avoid leasing to several people that were almost certainly going to be a problem.
Surprise Home Visits
One of the best tips I ever got was from a seasoned landlord that had a huge portfolio of single family homes. He told me that one of his favorite strategies was to make the tenant wait a couple days for a phone call to say whether their application was approved. If he had decided to approve their rental application, there was one last test they had to pass. He would show up unannounced at their home for a surprise visit. At this visit he would have some piece of paperwork he had “forgotten” to give them. Getting a look at how they were living in their current home, would be the deciding factor as to whether or not he would ultimately rent to them.
Get A Criminal Background Check
Often when landlords run a credit report, they skip the criminal background check to save a couple of bucks. Don’t be tempted to do that. You can save yourself a lot of headaches down the road, by spending a few dollars on the front end. The same goes for checking the free sex offender registry. The last thing you need is this kind of problem in one of your rentals.
It’s A Crapshoot
Even if you have carefully done your due diligence, it still can be a crapshoot when it comes to finding the perfect tenant. I believe that any additional steps that you can take to weed out a bad tenant in the beginning, is well worth the trouble in the end.
This article was written by Sharon Vornholt and originally published on biggerpockets