Tenant Screening Tips to Live By

Tenants play what is arguably the most important role in your rental property investment. Without them, you’re not making money. That’s the bottom line. So naturally, you want to pick high quality tenants who will pay rent, respect your property, and hopefully, keep signing that lease over and over again. To do this, it’s critical that you screen your tenants to ensure they're the type of people you want living in your rental home. Use these tips when screening potential tenants:

1. Have them fill out an application. Every tenant, even if they’re your real-life best friend, uncle, or whoever, needs to complete an application to rent your property. This application should include all their basic contact information, along with employer info, who will be living at the property, and rental history. Basically, you want the application to paint a picture about who this person is and their reliability in respecting your property and paying rent. (Application pro tip: Be sure you’re in compliance with fair housing laws.)
2. Make them show ID. Obviously, you want to make sure they are who they say they are. Ask for a picture idea, and make of copy of it to keep with the application.
3. Do a background check. Background checks will shed even more light on your potential tenants. You can hire a company who specializes in this, or DIY using online screening tools. Areas to cover include state and national criminal records, the national sex offender database, and prior address information.
4. Don’t forget the credit check. Credit checks are just as crucial, as they offer insight into your tenants’ current and past financial situation. A credit check will detail bankruptcies, evictions, and more. Be sure to have the prospective tenant sign a credit report authorization first.
5. Talk to some former landlords. Guess who’s going to have the best information about a person’s rental history? Their previous landlords. Ask for their contact information, and then give them a call to see if any red flags pop up.
6. Ask for references. Character references should also be requested, as these people can provide further insight about your potential tenant. If you contact a person on the list they’ve given you and get a “this number is no longer in service,” then this prospective tenant may not be the best fit for your property.
7. Meet them in person. So much of our lives these days are conducted over the internet or phone, that meeting in person isn’t always a necessity. But when we’re talking about your investment property, it’s vital that you take the time to meet the person (or people) who will be living there. This will be your best glimpse into their personalities, and the face-to-face will help you make a better decision about whether or not to lease to them.
8. Give them a Code of Conduct to sign. This should detail your expectations of the tenant and others living at your property. Make sure there’s a space at the bottom for the tenant to sign and date, acknowledging receipt and understanding of the document.
9. Let a turnkey group handle all this for you! As an alternative option, you can work with a turnkey group with in-house property management who will take care of all of this for you. These companies specialize in all things related to investment property, from the initial purchase of the rental home to tenant selection and ongoing maintenance.