As a property owner, it is of utmost importance to check a prospective tenant’s background as a vital policy of protecting your investment. A background check helps you delve deeper into the risk factors of renting your property to tenants, and lets you judge the financial conditions and past habits of the potential tenants.
High-risk tenants who are irregular in paying rent at previous accommodations, involved in criminal activity, or have damaged rental properties before can behave irresponsibly in the future. On the other hand, if they have a good credit history and pay their rent on time, it is highly probable that the tenant will continue to behave responsibly.
After all, once the lease agreement is signed, it can be very expensive to carry out the eviction process for high-risk tenants. Thus, it becomes highly crucial to identify high-risk tenants and ensure that you are handing the keys of your property over to responsible hands.
How to perform tenant background checks
Telephone interview: After you advertise for renting your property, you might start receiving phone calls to inquire about the property. The initial phone call is the first logical step to screen tenants. The type of questions the prospective tenant asks you helps to judge their intentions.
Asking the prospective tenants the below questions will help you filter the ones that do not fit the criteria:
- Why you want to move?
- How many people intend to move into the rental unit?
- Do they smoke?
- Do they have any pets? If yes, how many and of what type?
At this stage, it is prudent to inform the tenant about the details of the security deposit, monthly rent, and any other fees you intend to include. This will help to eliminate those who are not willing to pay the above-mentioned fees.
Face-to face-interview: If you are satisfied with the telephonic interview, you can go ahead and conduct an interview. This is an important step towards the screening process. Recognizing small details such as the prospective tenant’s vehicle, behavior, and overall appearance might serve as indicators of their potential behaviour in the future.
Tenant application: If you are comfortable with the prospective tenant, you might invite them to fill up the application form.
Hiring an agency: An experienced agency can help you to take the process forward, and help you screen with important details that ensure you are choosing the right tenant. An agency will help you clear the following details about your potential tenants:
- Previous tenant history: Gives information about all the previous records to verify for any criminal records, match the details listed in the application, verify evictions, and more.
- Credit report: It may include details such as personal information, credit profile, collections, any warnings, and more. Credit reports may differ from tenant to tenant.
- Credit score: Determining the credit score on the basis of the information accessed through a credit report to determine the overall creditworthiness of the prospective tenant.
- Eviction: It includes data collected from county-level courts for any judgments passed for eviction.
- Criminal records: Ensures that your prospective client does not hold any criminal records on a statewide or nationwide basis.
- Terrorists: With the increased activities of terrorists across the country, the report helps to scan multiple databases across the FBI, Interpol, Office of Foreign Assets Control, and more for an in-depth check of the records.
- Sex offenders: Include all the records if the future tenant is convicted of any sexual offense across the entire nationwide database.
- Federal search: Search nationwide databases to collect information for offense of any rules and regulations such as crime of violence against children, murder, kidnapping, white collar offense, and checking the most wanted list to ensure that your tenant is clean.
A background check is a long and tedious method, and if any piece of crucial information is missed, it can increase the risk of your property. Thus, getting the assistance of a good agency can help you to secure your property and provide your peace of mind.
Source: tenantalert
