Who does the best/cheapest tenant credit checks?

Question

Setting aside for the moment any criminal or landlord registry checks, I'm curious to see what type of credit checks y'all use and how well they work for you. To the best of my knowledge, there are more or less three general kinds of checks you can get:

-Raw credit report, no scores, cheapest
-Credit report with FICO or other scores, moderate
-Credit + Risk report with rental recommendations, expensive

I don't know the setup fees for many of the places that offer these. I've seen raw credit reports for as low as $4 each. Equifax has an ePort service now where you can get their report with a score for around $4 each. In addition, some companies will not only look at credit but add in other factors like # of moves, type of credit owned, incomes, locations, etc. and come up with a composite risk score based on some algorithm that shows real likelihood to pay their rent on time.

Some companies will also provide a layman's terms recommendation like, "Charge maximum security deposit" or "Renting to this person presents a VERY HIGH RISK they will not pay rent on time" etc.  Though I find this last category the most helpful, the reports I've found ranged from $7-$25+ each depending on the company, whether you buy in bulk, etc.  Wondering if anyone else has had good/bad experiences and is willing to talk about prices/quality without just advertising their own company?

Are the credit + risk reports worth the extra money?

:chicken:

Jean Witty · Answer

In addition to a credit check you should also do a financial verification report. If you pull someone's credit and let's say they have had a foreclosure 3 years ago so you're skeptical, you can do a financial verification report that will provide you with 12 months worth of income, cash flow, assets, and line item spending, that tells you if your tenant is approved for your rental amount based on the data. This gives you greater transparency on how the tenant manages their money and if they are able to pay on-time. These digital reports are sent to you instantly and are secure. The only company providing these reports are Finret.com.

N/A N/A · Answer

I am personally very careful with my credit, and I do credit-checks for all of my tenants. However, most of my tenants have had less-than-perfect credit. The rental market is soft right now, and with the recent home-buying craze, most people over the age of 25 with good credit now have a mortgage, and aren't looking to rent apartments. I still perform credit checks, but I just look for major red flags, like bills that they are currently behind on, bankruptcies within the past four years, etc.

I also heavily weigh references from previous landlords, and verify that they are currently employed.

I've written a couple of articles about tenant screening and references on my website:

Tenant Screening - http://www.iboughtaduplex.com/?p=15
Checking References - http://www.iboughtaduplex.com/?p=16

For credit checks, I use Landlord2Landlord - http://www.landlord2landlord.com/

N/A N/A · Answer

It is always a good idea to look at everything about a prospective tenant. For example, make sure they have a good job and have been employeed for more than a year. Also, I would recommend asking alot of questions - I get more information from prospective tenants than you could imagine. Make sure your questions are straight forward "Have you ever been evicted before?" I have had some people say yes to this question and my recommendation is to walk away.

For credit checks I use CreditRetriever.com I feel their prices are fair and the report is very easy to read. You will also get the report immedately there is no wait time.

Hope this information helps you out.

Marc
www.greenfieldent.com
purchasing without competition

Bryan Casteel · Answer

I always do a full workup on each tenant application.  I have been using MrLandlord.com to run the credit, eviction and criminal checks.  I don't screw around when it comes to tenants and they fill out a long application and they give me $20 for the application fee.  The cost from MrLandlord.com is around $18 or $19.  If I find any discrepencies, I either throw out the application or confront the potential tenant for an explanation.

Jason Barnett · Answer

The answer to this question is going to be dependent on the type of property that I am trying to rent.  Quite frankly I own property in an area that is lower-class and credit alone cannot be the determining factor.  The reason?  Because almost everyone in this area has bad credit because of medical bills, or credit cards, bankruptcies, or whatever.  If these people had a 700 FICO then they wouldn't be renting from me.   :violin:

When I am screening tenants in this area I am mostly interested in knowing what problems they have had in the recent past.  I am mostly interested in bankruptcies, foreclosures, and evictions that have taken place in the past 3 years.  The reason here is pretty well tested: if someone has recently had one of these problems then they are (probably) still irresponsible with their money.  However, once someone has had a hard time for 3+ years they learn what it's like to have poor credit and not being able to get what they want.  At this point these folks tend to pay better because they've learned how to manage their money better and they know that they have to pay rent on time or they're going to be evicted.

On the other hand... if I am renting in a middle/upper class area then I am very interested in a person's FICO score.  These people are aware of credit, they at least know that they have to pay their bills so the FICO means more.

In all cases I want to check out the criminal background because that means more to me than credit.  I am not talking about traffic violations, I am talking about drug possession / intent to sell, domestic abuse, things like that.  If you let someone sell drugs out of your property then you are just asking for all kinds of problems.  I have been fortunate enough to avoid this (so far), but I have some friends that have dealt with it and it ain't pretty.

Personally I use NTN for my screening.  There is no setup charge and they can perform nationwide criminal background checks as well as credit checks.

Who does the best/cheapest tenant credit checks?

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