You wouldn’t let a stranger borrow a high-value item you possessed, so why would you let one live in your property? Obviously, these are two different scenarios, which is why it’s important to collect a standard rental application for any prospective tenant interested in your property. By having them fill out a standard rental application, you can have the peace of mind knowing they are the person they claim to be and are a good fit for your rental property.
But what information do you need on a standard rental application? Here’s a handy breakdown of all the information you’ll want to get from each applicant:
- Personal Information
- Residence History
- Employment History
- Verification/Other Documents
- Screening Reports
1. Personal Information on a Standard Rental Application
Ensuring the applicant is the person they claim to be is an important step in finding the perfect fit for your rental property. By accessing basic information on your prospective tenant, you can cross-reference it with the tenant screening reports (which we will discuss later).
This information will provide you with the basic details you need to know who your applicant is. Name, date of birth, government-issued ID, and current address are all standard pieces of information used to know who exactly is attempting to move into your property and provide a framework for the rest of the information you will receive in the standard rental application. It is always good to keep this information on file for applicants who become tenants in case one of them turns out to be more trouble than they seemed.
2. Current and Previous Residence(s)
The last thing you want is to rent to a tenant who was a nightmare for a previous property manager. That’s why you need to look into his/her residence history by contacting current and previous landlords.
The previous manager is supposed to be honest, but what you don’t know won’t hurt you, right? Wrong. This is why it is important to ask for a previous residence on the standard rental application form, which RentSpree does. By checking the previous residence information, you can be sure to acquire an even better picture of the prospective tenant you are looking at.
It is especially crucial to make sure you get into contact with the previous landlord in addition to the current one. While the current landlord may wax-poetic about their tenant, a previous landlord is more likely to provide extra information that may be pertinent to making a decision about this applicant.
It is common to require 3 years or more of previous rental history, which, most of the time, cannot be provided with just a current residence. Further, this information can be cross-referenced with...you guessed it...the tenant screening reports! But before we get to those (and trust me, we are almost there), there are a couple more sections to go over in the standard rental application.
3. Current and Previous Employer(s)
There are many reasons why someone would change their job. Maybe they had an injury, were laid off, or found a better position at a new company. Whatever the reason, it is up to you to verify their employment and income. By providing current and previous employer information, applicants give you peace of mind knowing they have a stable job with steady income. This will also help you determine an accurate income-to-rent ratio, which is widely accepted as a 3-to-1 ratio.
You can then take things a step further and verify that the information provided is true and accurate with any current or previous employers. With a landlord, you’re interested in finding out how good or bad of a tenant this person is. With employment information, you’re given insight into how much someone makes and whether or not they can hold a job for prolonged periods of time.
You may not realize it, but an applicant who frequently changes positions may translate into a poor tenant. A tenant who is constantly changing jobs may not always have a steady income, which means you may be missing rent checks while the tenant searches for a new job. Or they have no issue with breaking the lease to relocate for a new position. Whatever the reason, you’re going to want to find a tenant who has a steady (and verifiable) income, and no issue providing the information to you.
4. Extra documentation and verification
Like any good detective, you need to corroborate all of the information you’ve received. How else can you be sure that your applicant, who has no rental history, can afford the rent for your property? By verifying the information they provided, of course!
Anyone can say they work for Joe Schmo and make millions a year, but not everyone can prove it. Asking for supplemental documentation, such as tax returns, W-2/1099’s, and bank statements helps to provide you with the clearest picture of your prospective tenant.
This is all common information to ask for, and you can even take it a step further by contacting the current and previous employers and landlords. While most require written permission to disclose any information, most references will be more than willing to provide as much information as possible to help you feel secure about the person(s) moving into your property. By contacting the employers and landlords, you can collect official confirmation that the information provided is true and accurate. More often than not, you will learn something about the prospective tenant not included on the application or reports!
5. Screening Reports
Once you collect a standard rental application, it is time to collect the screening reports. Typically, this consists of a credit report and score, but you may choose to collect a criminal background check and nationwide eviction report as well. While the credit report will provide a score and breakdown of the applicant’s tradelines (balances, monthly payments, limits, late payments, etc), it will not include eviction or criminal background information.
For this reason, it can be helpful to collect the other tenant background checks mentioned. The criminal background check will provide valuable information on any criminal behavior in the applicant’s past, with respect to state laws and regulations. The eviction report will include any eviction data available on the applicant. Since evictions are getting costlier and more time consuming, having this data helps you make the best decision for your property. As previously mentioned, you can even cross-reference the reports with the information provided on the standard rental application.
At the end of the day, it is not only wise to collect a standard rental application that contains all of this information, but it will save you money and time in the long run. Remember, you are allowing a stranger to live in your property. Tools are available to make sure you pick the best fit, so start using them and stop worrying about whether your next tenant will be a nightmare or not!