Tenant Screening: How to Pick a Good Tenant
For landlords, property managers and investors who rent property to tenants, selecting good tenants to rent the property is essential to the financial success of the rental. Good tenants will take care of the property and ensure that the rent is paid on time and in full. On the other hand, questionable tenants may damage property, pay rent late or not at all.
The best way to ensure that landlords and investors select the right tenants for their rental property is thorough tenant screening. Tenant screening may include calling references and employers listed on the rental application, as well as background and rental history checks for the applicants.
Before landlords are able to select good tenants, first they must attract prospective tenants to the property. A few tips will provide lessors with ways to attract potential renters to their rental property. If several renters seek to rent the property, the landlord is able to select the best tenant for the unit from among the best of the interested parties.
- Spend a few days researching other rental properties that are available in the area. Ensure that your property is at least up to par with what is available. Better still, make the property better than any other rental available in the area. Include an extra or two that other rentals do not have and highlight the benefits when showing the unit.
- Research where people are searching to find rental information and place an ad in this publication. For example, if the rental unit is located in a smaller town, and most renters use the local paper to find living spaces, advertise in the local paper. Though it may be easier to post an ad on the internet, if few potential renters use the internet to locate their next living space, an ad on the internet will not yield much in the way of results.
- Offer specials for renters. One free month rent with the signing of a long-term lease is a great way to provide an incentive to a good tenant.
- If the rental unit is located near a college or university, list the unit with the school’s housing department.
Tenant Background Checks
Once potential tenants are seeking out the unit, begin accepting applications from the prospective renters. With the information provided on the rental application, perform cursory checks to select the top three or five applicants. Landlords will most likely want to check the applicant’s credit rating and rental history. Landlords may also wish to perform more in-depth background checks. Use a company that specializes in background checks for tenants to perform the legwork. Companies that perform tenant background checks usually offer different levels of service for different prices. Basic packages will tend to include checks such as:
- Identity Verification
- Statewide Criminal Background Check
- Statewide Sex Offender Check
- Terrorist Watch List
Premium packages will often add the following services to the basic plan items:
- Credit Reports
- Nationwide Criminal Background and Sex Offender Checks
- Address and Rental History
- Judgment Check
- Bankruptcy Check
- Tax Lien Check
Companies that provide background checks for tenants provide a valuable service for landlords and investors. Though no one can predict whether a tenant will be a good renter or a bad renter, the person’s history will often reveal how they pay their bills and whether they have had rental issues, such as evictions, in the past. History is an excellent predictor of an individual’s future behavior, which is why tenant background checks are a valuable resource for landlords and investors.