They should be an essential element of your screening process. Learn what you can find out from these tools and how you can put them to work faster and more easily.
You may think of a rental background check as a tedious process, a technicality during the task of finding a new tenant. Gathering paperwork, evaluating supporting documentation, and reading confusing legal and financial reports may leave you frustrated and looking for another way. After all, surely no form or process can tell you more than your gut reaction and years of experience, right?In reality, a properly conducted screening process is an important way to protect yourself, your property, and your other tenants. In addition, it protects you from liability due to the actions of your new tenant. Just what do rental background checks show and how can you streamline the process to get faster, better results?
What to expect from a Rental Background Check
You may think that a background check is just a financial screening or just a criminal background check. However, a thorough background check includes both of those elements and more.
Criminal Background Check
A comprehensive criminal background check involves a variety of law enforcement entities in order to ensure a complete picture of your applicant’s background. State and national records, as well as databases like Most Wanted lists and the Sex Offender Registry, provide a thorough view of your tenant’s past behavior and potential for future criminal actions.
Remember that it is not just violent offenses that you need to consider. Drug offenses are especially problematic since they could result in the use of your property as the site of drug dealing or drug use. This opens you up to the potential for additional civil liability and criminal penalties, especially if it is found that you had a reason to suspect that this activity was taking place on your property.
It is important to know what your applicant’s attitude is toward on-time and consistent rental payment. Previous evictions, court records, tenant judgments, and writs and warrants of eviction are indicators of past failure to pay rent and should be taken into account during the screening process.
A credit check is an important tool to help you find out if your applicant is overextended or has a history of non-payment, including bankruptcies, liens, or other negative indicators. Be sure to comply with your state’s laws regarding both credit checks and adverse action notices in the event that a credit check turns up unfavorable facts.
You’ll need to check your applicant’s employment history in order to ensure that they have a record of consistent, gainful employment. This stability is an indicator that they will continue to be employed and therefore able to continue to pay rent. Long stretches of unemployment need not disqualify a potential tenant, but they should be explained before approval.
Proof of Income
You may want to request proof of income like paycheck stubs or a letter from the HR department of the potential tenant’s employer in order to verify their ability to pay rent. Consider income in relation to the debt noted on the credit check in order to further evaluate financial readiness.
Proof of Employment
Similarly, you may want to request documentation to verify current and ongoing employment as well as employment status like full-time, part-time, temporary, or seasonal employment.
You will want to request references from previous landlords in order to ensure that the tenant was reliable, consistent with rental payments, and that they took care of the property both during the period of occupancy and upon leaving.
Make your Rental Background Check more effective
If it sounds like a thorough background screening is an involved process, it is. However, it doesn’t have to be a difficult one. There are platforms that can streamline the entire process and make it far more efficient and effective. Here are some of the features to look for when you are creating your procedures for a rental background check.
Ease of Use
If you are trying to collect multiple forms, documentation, and records from a variety of potential tenants, you can soon find yourself juggling far more paperwork than you had anticipated. An online information gathering process can offer both you and your prospective tenant a faster, easier way of submitting and evaluating information.
In addition, a streamlined online process offers you the ability to compare multiple tenant applications in order to determine which one is preferable.
Besides the application itself, you will probably need some supporting documentation like a state-issued ID or driver’s license, paystubs, or a letter from the applicant’s employer. An online application can include the capability to upload these documents, ensuring that you have a complete application with everything you need for an effective screening.
In addition, an online process that uses a secure portal provides more protection for your applicant’s sensitive financial and background information, allowing them to be more forthcoming without worrying about data security.
It’s a good idea to check those references provided by your tenant. An effective electronic background check can build reference verification into the process, making the application more reliable and freeing you up to spend your time on something other than playing phone or email tag with previous landlords.
If you’re looking for a secure, dependable platform to help you gather and evaluate information on potential tenants, RentSpree has all of the features you are looking for. Upgrade to RentSpree PRO for additional tools like reference checking and secure supporting document uploads.
Whether you are a real estate agent, property manager, or landlord, you never pay for RentSpree’s service. The applicant pays for the screening and the reports are available to you as soon as they are authorized.
Ensure a higher degree of scrutiny, a more effective application process, and more protection for you and your property. Contact RentSpree today and find out how to put our resources to work to help you make better decisions on every rental.