House Hacking - renting bedrooms, screening tenants

[David Yamamoto]

Hello folks,

For those that have house hacked while renting out bedrooms to tenants... how do you screen them?   This seems a so much more personal when you have to actually share the same living space with tenants.  Do you screen with a company or do it yourself? This is a brand new concept to me... 
(Property in question is a 3b single family home). 

Thanks,
David. 

[Scott Trench]

You treat it like a business and run it like a business, if you weren't living there. 

Go here: https://www.biggerpockets.com/landlord-forms

As a Pro Member, you get free leases and forms, attorney reviewed and state specific, and I just went ahead and downloaded the Washington State forms. Have them fill out the form and complete the rental application. I also suggest that you set up a RentRedi account (free and included with your pro membership) and put them through the formal process there - you can have them apply through RentRedi's software as well. 

When you get the information from the tenant, I would make sure to call all of the previous landlords (I also like to independently verify the contact information provided, and that the landlord is in fact the owner/operator of the property - for example, if an apartment complex, I check to see if the number on the application is the same as the one provided by the tenant - occasionally, they will put a friend/family member's phone number to give a fake reference). 

I ask a number of yes/no questions like: 

- Can you confirm the dates tenant lived there? 

- Was the tenant ever late on rent for any reason? 

- Did the tenant ever cause a disturbance? 

- Did the tenant have any pets? If so, what were they?

- Did the tenant receive all of their security deposit back at move out? If not, why not? 

I also ask the tenant to complete a tenant credit, criminal, and background check (usually a $35-$45 fee, paid by tenant applicant). You can do that through RentRedi, or by clicking o the "tools" link in the navigation bar here on BiggerPockets, and looking for "Tenant Screening"). 

I do not accept tenant applicants with below 650 FICO/credit scores (although note that various of the screening applications use differing definitions of "Credit Score" - I am looking for FICO, or enough cushion on a variation that it doesn't matter). I do not accept tenants with violent felonies, prior evictions, or felonies related to theft. I do not care about certain drug related offenses, like those involving marijuana, which is now legal in CO. Your state may require you to accept tenant applicants who violate some of my standards, so you should check up on laws.