Professional Tenant Screening Worth the $$$

[Chloe Nave]

As a new investor looking to lease purchase properties to potential home owners I am so glad that I invested in a professional tenant screening service to find the best possible candidates. Here's my story of how I almost got scammed (I think):

I responded to an inquiry from a local REI member who was looking to place a tenant (friend of his) into a home in a certain area. I am closing on a home in the desired area and plan to lease it with a purchase option for $1000/mo. This sounded like a perfect opportunity to have the home leased out almost immediately after closing so I was excited! The local REI member spoke very highly of the prospective tenant, assured me she could pay the requested rent, and shared his 25+ years of experience in real estate with hints of how he could be of benefit to me, a newbie in RE investing. I showed the home to the prospective tenant, she completed a credit and background application on the spot, and wrote a deposit check I required to hold her position in the home pending results of her screening. Meanwhile the local REI member called me several times and even recommended the same screening company that I had researched online. To my surprise the results came back "Not Recommended-High Risk" so I immediately informed the tenant that her application failed. She said she would call the screening service right away and I told her if she could get them to change their recommendation then I would reconsider leasing to her. I called the local REI member and he expressed surprise about the results and stated that he would talk to his "friend" about it. It's been 5 days and I have heard nothing further from the prospective tenant or the local REI member who had recommended her. In fact I still have the deposit check which I suspect is worthless since no one has called requesting it be returned.

Bottom line, there were several negatives that came back on this prospective tenant which I may not have known without the professional tenant screening service. I am so thankful that they called me personally to share the results of the background check and their recommendation. They even stated that it is not often they put "High Risk" on the results but this tenant was quite adept in hiding her background and they wanted to be sure I understood the risks if I chose to proceed with accepting her application. Believe me, the $50 screening cost was worth the service. I will continue to screen future applicants through them until I get one who is recommended . . . . and I will be cautious about tenant recommendations from eager REI members.