The Ultimate Guide To Tenant Screening For Landlords
Rental income is an excellent source of passive money if there are a few glitches and problems to worry about. As a landlord, mistakes like allowing the wrong tenant onto the premises can be costly. A tenant may default on rent payments, wreck the property, or cause legal disputes.
How, then, do you go about securing the relationships with
tenants and your finances? By using an efficient rental screening service.
What makes a good tenant?
A good tenant is mindful of the resources they are
responsible for and their provider. As a result, they ensure they pay rent on
time and communicate when they have trouble meeting this deadline.
Moreover, they care for the property. Imagine walking into a
house after a renter has moved out to find the paint peeling and a section of
the wall scorched. Yet, a well-cared-for house will retain its initial
cleanliness, functional utilities, and overall state even without these
exaggerations.
Effective tenant screening
Before allowing a renter into the premises, they need to
undergo effective screening. Optimal screening varies among different people,
and there is no one-size-fits-all method. However, if you cannot perform a good
review, rental screening services can come in handy.
At the bare minimum, each screening process will involve
these essential elements:
Tenant screening reports
Credit report
A credit report gives how reliable the renter will be in
meeting their obligations. The credit reports available to landlords and
property managers are:
·
Full credit report- It provides the FICO score
·
Credit report card- It provides a score range
The critical elements in a credit report
The tenant's credit score- Scores can range from 350 to 800,
with 800 being a great score. The score might be lower if the tenant recently
lost their home and is a factor that a landlord must consider.
Debt level- Even when the tenant has a good credit score, check
their current obligations like credit card debt and how well they meet their
deadlines. This information will indicate how likely they are to pay rent on
time.
Criminal background report
When reviewing a tenant's background report, ensure you have
the correct personal details, such as the name and date of birth, and verify
their address history. These will ensure the report is accurate.
The eviction history reports
Eviction history reports will provide a history of the
tenant's past stays. Who they were in previous homes is likely who they will be
in their new home.
An interview process
A good renter is not just one that pays rent on time. They
also need to be pleasant and capable of existing in harmony with the other
tenants. The easiest way to evaluate a potential tenant's personality is to
schedule an interview or a series of interviews. These could be over the phone
or in-person as they also get a feel of the property.
This conversation should cover what is relevant to establish
their capacity to be a good tenant, not pry into their personal matters.
Moreover, it gives the room to verbally confirm the details they have provided
in the reports, such as where they are from or their rental history.
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