Screening Tenants Carefully to Avoid Future Evictions
As an independent landlord, it is crucial to prevent future evictions by identifying red flags in potential tenants. Here are the top 5 ways your tenants may set off red flags:
1. Past Evictions: Previous evictions are a strong predictor of future evictions. Renters with a history of eviction are more likely to have rental related collection records.
To protect yourself, conduct thorough background checks that include eviction history. TenantTracks, a reputable screening service, offers this feature along with other tools to effectively screen your applicants.
2. Insufficient Income: Tenants with inadequate income may struggle to pay rent. It is important to set an ideal rental rate based on local market conditions and verify that your potential tenant's income is at least 2.5x to 3x the rental rate. Request proof of income such as paystubs, tax returns, or employer letters. To ensure accuracy, consider using a screening service that can verify income, banking information, and more. These features are coming soon to TenantTracks.
3. Criminal Record: Failing to check a rental applicant's criminal history can lead to legal risks and potential harm to your property and community. According to TransUnion’s criminal record data, 1 in 5 renters screened had a criminal record. While not all criminal records may be relevant to their ability to be a responsible tenant, it is important to screen every renter. Use a reliable background check provider to access criminal background information that complies with the Fair Credit Reporting Act (FCRA). Do remember, CORI is not enough as CORI is Massachusetts ONLY and criminals move surprisingly enough.
4. Bad References: Checking rental applicant references can provide valuable insights into their past behavior. Inquire about the percentage of security deposit not returned, late payments, and early termination of lease. Honest feedback from previous landlords can reveal red flags that may not show up in background checks or credit reports. If the rental reference is not positive, have a conversation with the applicant to understand their side of the story.
5. Reluctance to Fill Out a Rental Application: A complete rental application is essential for verifying the identity and personal information of potential tenants. If an applicant avoids or provides an incomplete application, it may indicate ulterior motives. Qualified tenants understand the importance of the application process. Ensure your application covers personal information, employment and income details, rental history, relevant criminal history, and pet/smoking status.
By conducting thorough background checks, verifying income, checking references, and collecting complete rental applications, you can mitigate the risk of future evictions and make informed decisions as an independent landlord. SmartMove, a reliable screening service, offers comprehensive background checks that provide confidence in selecting the right tenants for your property.
by Paul Jenney
