Choosing and Screening Right Tenants

Apr 8 2015 / 10:36 am Was written by Atwell & Co. Comments Off
choosing screening right tenant

Supervising your rental property can be a breeze if you choose the right tenant. The quality of your tenant is essential in making a steady income as a landlord. Finding a tenant is simple, but finding a right tenant is quite challenging. As a landlord, you are entirely giving them all the rights to live in your property. In order to preserve your investment, you need to take time in selecting the right tenant for your property. You should set certain requirements for them to meet in order to rent your property. The tenant screening process is as similar as interviewing an applicant for a job. It can be cumbersome but it will eventually become profitable. Having good tenant will make you sleep well at night knowing that the rent will get paid on time and your rental property is taken care of. So in order to make sure that you have the right tenant, its crucial to screen every potential applicants carefully before letting them sign the lease. More importantly, present your property at its finest to captivate right tenants who will care for your property as much as you do. Here are some ways to choose good tenants.

Personal Information and Discrimination

As a landlord, before you decide to let a potential tenant rent your property ask them personal information first. Their name, contact details, ID details, renting history, where they are currently living and references you can contact to know more about them. You can have them fill out a simple application form to know more about them. However, there are important rules to be aware when collecting personal information from the applicants. For example, you must have a legal reason for collecting the information, and why it’s collected, what you do with it, and the tenant must have the right to access it. You can rent your property to whichever tenant you choose. However, you cannot refuse an applicant by cause of the applicant’s race, religion, sexual orientation disability and ethnicity. It is illegal to deny a tenancy to a person because of discrimination. As a landlord you must be rational in treating any applicants.

Affordability

The common problem landlords deal with is having a tenant who is always late on rent. A prospective tenant must be able to prove that they can manage to pay your rental property. You can ask information about their income details, employment details, credit history and reference from a former landlord. To confirm their employment, monthly earnings and attendance record, you can call their employer straightaway from the employment information that you have from them. To determine if a potential tenant will be able to afford your rental property is to ask them about their monthly income as well. If an applicant has a monthly income that is two and a half times the monthly rent then that applicant is a prospective tenant. So look for a financially responsible tenant. Financially responsible tenants are more likely to pay their rent on time. Make sure that you ask the potential tenant a list of his and her previous housing details. Then make phone calls to their previous landlords and talk to them about the background and credit checks. You can ask about common landlord nightmares such as broken leases or bounced checks. Don’t forget to run a credit check, this will enable you to know how much debt they have that will make a great impact on how well they pay rent on time. Check for previous bankruptcies or evictions as well.

Criminal Background Check

As a landlord, you need to run a criminal background check on a prospective tenant. It could pose a threat to your safety, your other tenant’s safety and your neighbors if you have a tenant who has history of violent crimes. Furthermore, if you have a tenant who was convicted for dealing drugs in the past then that tenant will more likely turn your rental property into a new base for his operations. You will need the tenant’s name and date of birth in order to check for any criminal records. Tenants with criminal record will give you false identity so to make sure that they gave you the right information check their valid ID for verifications. Also a background check will give you all the right information you need about the tenant’s past. Some investigative company will provide you with criminal history, credit history and eviction history for a fee. Also you need to consider their eviction records, criminal records and public records when you demand for a background check.

In order to protect your investment, make sure that you have a solid screening process for applicants. There is no better way than meeting them face to face, asking them questions and keeping an eye to their overall dispositions. Just like in a job interview, tenants will try to present their best in front of you, which means you won’t actually see the real them until later. So make sure that you pay close attention to their personality in case you feel comfortable with them or not. No landlord would want to have a bad tenant. Applicants present the best versions of themselves and some of them will hide the facts that would eradicate them for consideration. As a landlord, you are entitled to choose a tenant that you think is the most appropriate as long as no discrimination is involved.

These factors will help you choose the right tenant for your investment property. It will also save time and money by dodging damage to your property, non-payment and worst costly evictions.

There’s a lot to scrutinize when screening prospective tenants. From personal information, criminal background checks, income stability and finally to their former housing history and landlord references. It is crucial to examine them from different angles. Doing this can be discouraging, monotonous and perplexing but the screening process is worth the effort to make sure that you end up with the right tenant.

If screening process of prospective tenants is a tedious job for you, you can always hire a rental property management company for a fee to the work for you or you can just find tenants yourself and keep your money.

Atwell & Co Real Estate
Unit 6 / 29-30 Grattan Street Prahran, Victoria 3181
Phone: (03) 9510 6203 URL of Map