As of 2019 44 million households were renting their homes, this number is consistently on the rise. With more and more people looking to rent the applications per property are rising even more quickly.
Understanding what is most important when vetting tenants is essential. These items and how to deal with them can give a clear picture of what makes an efficient approach.
1. Application as a Foundation
This is the most efficient way to start the process for any potential tenant. There are many options when it comes to creating the application itself, from using software templates to offerings at real estate organizations.
Applications allow for quick collection of essential information. The following points are some of the most important that should be shown:
- Employment history
- Income level
- Contact information for previous landlord(s)—include dates of rental
- Detailed personal references
2. Credit Check
This is often done with Equifax and will give a report on between seven to ten years previous. A credit report will provide you with a clear picture of financial management and any large missteps on the tenant’s behalf.
Part of the ‘credit check’ part of the process can be a review of current finances. This extra step can assure you that they will be able to consistently make rent payments without any concern.
A review of the most recent bank statements (six months is generally more than enough) will give a good picture, this way you can have a clear picture of spending habits and if there are any red flags.
3. Background Investigation
Financial history will only give insight into, while a very important, one side of a tenant. While good credit history does not mean a great tenant bad credit history does not necessarily indicate a bad tenant either.
A background check can provide insight into any evictions, involvement with legal proceedings, and past criminal records.
If you feel there is a need to delve further into the character of a potential tenant or any past events, there are a variety of private investigator services that can be utilized for those means.
4. Proper Communication
Take the time to do a small bit of due diligence on the information provided with special attention to two details, employment and past rental.
Before a lease is signed it is important that the income mentioned is in fact accurate. There are a couple of ways to confirm this, the first being contact to the current employer.
There is the chance that the employer will not be able to give out complete details of pay history. If you require further information it can easily be found in a paystub from the tenant.
Getting in touch with past landlord(s) is equally as important as it can give a clear picture of any money that may still be owed, behavior while renting, and allow you to ask the all important question, “would you rent to them again in the future?”.
5. Make Sure to Interview
Everything can be filled out, filed, and look great on paper but there is still one last thing that you need to do. You need to meet the person face to face. A strong first impression will be that last small bit, sealing the deal.
An interview for a potential tenant is just as important as an interview for a job candidate.
Certain Protections Apply
There are a number of things that you can never use to factor into your judgement about renting to individuals and they are;
- Race and/or skin color
- Familial status
- Religious beliefs
It is important to understand exactly what is off limits just the same as what steps you should take to make the best choices. These items have all been protected by the “Federal Fair Housing Act”.
There are other protections that vary state to state as well so it is important that you keep up to date on those that may change as well, such as gender and sexual orientation protections.
Efficiency and Detail are Key When Vetting Tenants
With more and more candidates to choose from, you now have more to review and to consider. But with an understanding of exactly what to look for and how to review it, the task of vetting tenants will not be any more difficult.
You can be sure to make the best decision when you stand by these tips and when you come by the blog to read even more content just like this!