Tenant Screening

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Tenant Screening

It is no secret – finding and keeping responsible and respectful tenants is the goal of both a rental property owner and their property management team. Unfortunately, however, the quality of prospective tenants typically matches the quality of a property management team’s tenant screening process. Like with any interview, prospective tenants will only show their best selves when submitting an application and may work to hide factors that would keep them from being approved.

Tenant screening processes will vary from property team to property team. It is important that you ask questions to determine what length their tenant screening process goes to in order to protect your rental property. The more in-depth the screening process, the more protection you have against bad tenants and evictions. To get an idea of how protected your property will be from irresponsible tenants, ask these questions in your property management interview:

What protection do you have in place to avoid rental and tenant scams? Have you ever suffered from a rental scam?

We wish we were joking when we say that rental scams are real and growing rapidly. It is no longer just someone from a different country calling to scam your property. Local scammers are going as far as copying your advertising and pretending to be a property manager, so they can show your property and collect the security deposit (then run!).

Do you hold properties for tenants before the official lease is signed? If so, do you charge a fee?

If a property team allows a unit to be held prior to signing an official lease agreement, there should be a fee in place. This protects you and your property if things fall through. Without a fee in place, time and effort could be lost with nothing to show for it.

As an added bonus, some property management companies require prospective tenants to pay a small application fee. This ensures the person is truly interested and dedicated to leasing your property. If more than one person plans to live in the property, it is also smart to require each adult to complete their own application. This is the best way to understand the full picture of who will be living and caring for your property.

What is your method for screening tenants?

A good tenant screening method will cover a wide range of topics. Previous landlord recommendations, income and employment verification, and credit report authorization are just a few on the list of ways to gain information on how responsible and reliable a prospective tenant will be. In addition to these factors, property managers should be verifying the application for authenticity by running a search and contacting personal references.

While 59% of property managers believe that a steady income is more important than credit history when screening a potential tenant, 56% of property managers also say that no matter how much they like a tenant – they will deny someone if their credit check is bad.

Every property team will have their own method for screening tenants, and it is important you understand their process or the third-party company they plan to use. After all, quality screening increases the chance of quality tenants.

Will I be provided with prospective tenant information?

The right or wrong answer to this question is mostly based on how involved you want to be in the property management process. However, it is best practice to not be involved to the point of verifying each and every tenant application. You hired a property management team for a reason, and tenant screenings should be in a property manager’s realm of expertise. If you cannot trust a property team’s tenant screening process after learning more details about it, consider that a sign to find a different property management company. Let the right property team deliver the value you are paying them for.

What tenant qualifications are most important to you? What do you do if prospective tenants meet some qualifications but not others?

Qualifications like work history or education history should be important to a property management company. The more serious a prospective tenant is about their job or education, the more serious they will be about their livelihood. Unfortunately, the less someone has to lose – whether that be a family, money, or a job – the less likely they are to care how they treat your property and how well they uphold the leasing agreement.

Also, ask the property manager about their current eviction and turnover rate. Those numbers will be a great indicator of how well they screen and find quality tenants.

Eviction-related expenses average $3,500 and can take as long as 3-6 weeks to complete. Sound scary? Thankfully, a quality tenant screening process can help avoid these issues before they begin.

Once the right tenant is found, it is time to understand how the property management company plans to provide the best customer services to your tenants.

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