Screening tenants is a fairly straightforward process. You take their application, submit it to a screening company, and await the results. However, looking for tenants is not an entirely passive. It requires diligence and staying on the lookout for tell-tale deterrents. Remember, low-risk tenants will give you the highest profit, so be sure to watch for these ten red flags when screening applicants.
If your tenant doesn’t pull in enough income to cover the rent, you’ll get stiffed sooner or later. Ask for financial statements that prove their capability of payment. As a rule of thumb, tenants should have at least 3.5x the rent in income to make it affordable. Anything lower than that is considered a red flag.
When screening potential tenants, perform a rental credit check with SmartMove. This certified company offers all of the information you need in a quick and convenient way—best of all, it’s legally compliant, so you don’t have to worry about any of the legal mumbo-jumbo. Just send an email to your applicant, and the company does the rest. It’s essential your tenant has a strong financial history to ensure their financial responsibility. Do not rent to a tenant with risky spending habits, and make sure they can explain any dings or negative scores in their report.
Use a county level criminal check that will gather both opened and dismissed cases. No one wants a criminal living in their building, but some offences are worse than others. A domestic violence conviction is a huge red flag, because it means someone will resort to violence rather than addressing a situation in a civilised manner. Anyone with more than three convictions in five years can be trouble, as it’s an indication that they cannot obey rules.
Contact the references provided by your applicant. Past landlord references are a great way to determine the candidacy of a tenant. Ask them whether or not the tenant received their security deposit back and any other pertinent information. Some small charges are common and acceptable, but not getting most of the deposit back is a huge red flag. Other problems include late payments, terminating leases early, and not giving proper notice. Move onto someone who understands how to be a good renter.
Watch for candidates who fail to fill out their application fully. It could be a case of false identity, bad history, or plain apathy. Whatever the reason, these are not the right renters for you and should be turned away.
Unless your tenant has an abrupt job location, acting as if they’re in a hurry to find a rental can be a red flag. Desperation might point to a serious issue, such as an eviction at their current place. Be sure to follow-up with the landlord.
Relatives or Motels
Someone with a temporary living situation is not a good applicant. Living in motels or with relatives is a common theme among people who have been recently evicted. Solid tenants should have a strong rental history and should always have a stable living space.
Frequent Job Changes
Look for a tenant that has held down the same job or career for at least 12 months. People who frequently change their line of work are dangerous because it could lead to you being without rent when they’re between jobs. An applicant who demonstrates consistency will be a more reliable tenant.
Some landlords and property managers are pet friendly, but there’s a reason most are not. Chances are that your insurance company won’t allow dogs – especially breeds like Pit Bulls and Rottweilers – because of what a liability they are. If your tenant has a large or aggressive dog breed, avoid them.
When scheduling your viewing, know in advance who intends to come see the property. If more people show up than anticipated, it could be an indication of additional people living in the house or apartment. You don’t want to allow people who are not on the lease agreement to live in the apartment.
Not every red flag is a deal breaker, but some are. When you’re screening a tenant, have a pre-set criteria and see how prospects compare against your list. By avoiding sub par tenants, you’ll place less stress on the property and yourself.
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