Tenant verification is one of the most crucial elements of the rental process. Almost as important as finding the perfect property is finding the perfect rental candidate.
Making sure that the prospective tenant is responsible and trustworthy is essential in choosing the right suitor for your rental property.
While the tenant screening procedure can be a headache, we have simplified it into three parts to make your tenant verification experience as straightforward as possible.
Tenant Verification, Part 1: Credit Report
The first thing you need to do while screening your tenant is find his or her credit report. A verified credit report from one or all three of the major credit bureaus is important to tenant verification because it shows previous transactions, indicates responsibility, and gives you a better idea of what kind of investments and payments your prospective tenant may have.
What is considered a good credit score? As a rule of thumb, 740 and up is widely accepted as an excellent score. Anytime you see a score of 670 and below, you should consider taking a deeper dive into the applicant’s history.
While the credit score is important, the devil is in the details. This means always taking a look at a full credit report. A full credit report can reveal that someone doesn’t have outstanding payments or numerous loans. The last thing you want is a tenant with a low score that has a record of late payments. History tends to repeat itself.
However, while a high credit score is a good sign, it is not the only important aspect of tenant verification.
Tenant Verification, Part 2: Background Check
In addition to a credit report, a tenant background check is vital to the tenant screening process. A background check can show your prospective tenant’s criminal history as well as employment records and driving record.
While screening your tenant, you want to choose a background check that is comprehensive. Make sure that it has access to sex offender records and multiple criminal databases. A tenant slipping through the cracks of a depthless background check can make you look careless and unprepared.
However, background checks can also be costly. Ideally you would like to find a happy medium that gives you a quality background check without breaking the bank.
Tenant Verification, Part 3: Eviction History
Researching your prospective tenant’s eviction history is the third and final part of tenant verification. Tenant eviction is an absolute nightmare and can be a lengthy and costly process. Representing a client that gets evicted will most likely end your relationship with the property owner and damage your reputation indefinitely.
A great way to make sure your client does not get evicted is to make sure they haven’t been in the past. Like with background checks, some eviction checks are more in-depth than others. It is important you choose a report that will give you the best idea of your prospective tenant.
Finally, it is imperative you run the check yourself. For obvious reasons, clients are probably not going to be completely transparent regarding their eviction history. Which brings us to our next point"¦
If You Want Something Done Right"¦
Do it yourself. While in a perfect world we could trust every 800 credit score handed to us by a prospective tenant, that isn’t the case. The only way to truly conduct tenant screening is by running the background check, credit report, and eviction history yourself.