If you happen to have a property that is up for rent, and you had a bad experience with your last tenant, the best thing you could do is to use a company that provides tenant screening services. It makes sense to choose which tenant you would want to rent your property, as a good tenant would mean less hassle and less problems for you. You need to find out key information regarding your would be tenants, and most people would not be forthcoming with personal information such as their credit history, eviction history and even criminal history. At times, you may have the unfortunate luck of having a tenant who does not pay rent on time, or bring dubious individuals to your property or worse make changes in your property without asking for permission or destroying furniture or appliances. The thing with having a bad tenant is that it is difficult to evict them, they may put up a fight and may refuse to leave which in turn would mean bad publicity for the property and financial loss for the landlord. Thus, requesting your tenants to be subjected to a screening report is the only way to make sure you weed out the problematic applicants.
Tenant Screening Services
Tenant screening services are offered by companies that specialize in doing background investigations on individuals that are potential tenants for your property. It is a comprehensive screening process that will enable you to weed out those who might have issues and problems in their past and might be indicative of problem behaviors in the future. As a landlord, you would want to steer clear from these individuals, and the only way to do it is to subject them to a comprehensive tenant screening process.
When you ask for a tenant screening report, the company would provide you with the necessary information that would help you decide which tenant to choose if there are many applicants for the same property, or to check whether they are suitable tenants for you if they are the only ones. The screening report would provide you with the credit history, criminal history and even eviction history of the applicant.
The tenant screening reports would normally include a credit history and criminal history of the applicant, a more comprehensive report would include the eviction history of the applicant.
The credit history will give a soft credit score and therefore will not hurt the tenant’s credit score. The report would also contain the tenant’s FICO score, credit accounts, payment history, judgements and bankruptcies if any in the past.
The criminal history report is a comprehensive background investigation which verifies the identity of the tenant, as well as a nationwide search for any past criminal behavior extending to ten years of the tenant’s past. The criminal history report also checks for sex offender database, fraud alerts, previous convictions, most wanted list and other federal agency database like DEA, FBI and ODAC. With such information, you can clearly get a good picture of the kind of tenant that the applicant would be in the future and will save you the headache of having to deal with a bad tenant.
For an additional fee, the report could also include an eviction history report. This would check whether the tenant had been evicted in the past and the actions taken to evict him or her. This would prove invaluable because a credit and criminal history may come up clean and without any red flags, but the tenant may have a bad habit of violating your contract of agreement. A tenant may have never committed a crime or may have a perfect credit score and they can still be difficult tenants.
There are two ways in which you can ask for a tenant screening service, it could be the landlord requests and the tenant applicant pays for it, or the landlord requests and pays for it. Most applicants are not comfortable with being subjected to such background investigation and they would probably not want to pay for it. But if you choose this option and the applicant refuses the background check, then this could also be one way of finding out who can be a good tenant. People who do not have anything to hide would not be afraid of being subjected to such investigations.
Some landlords do decide to pay for the background checks themselves, as it is a way of exercising control over your property. You will have the opportunity to know your possible tenants even before you see them. An additional fee is required for the more comprehensive report which includes the eviction history, and it could an added cost, but it will save you money in the long run if it can ensure you get the best tenant for your property.
Most companies do offer a free service if you are not yet convinced of paying for a tenant screening service which is called a rental application. When a probable tenant contacts your real estate agent, then you could submit the name and email address of the applicant to the firm and they would ask the tenant to fill-up the rental application form and send it to you free of charge. In this way you can still be able to know basic information about the applicant but is limited to whatever it is they will write in the form.
No Contact Transactions
When you ask for a tenant screening report, the request is done online and you merely submit a request with the name of the applicant, and you pay the fees online and the report is delivered to your email. This would mean you need not interact with a staff or receptionist and fill out forms, you can do everything at the comfort of your home. Moreover, the applicant would not know that they are being checked on unless if you ask them to pay for the reports. Using a tenant screening service is as easy as pie and yet will be of immense help in your choice of tenant.
Whether you are a landlord or a lease agent, there should be no rush in entering into a lease contract when you are just starting to talk with a prospective tenant. Due diligence should be observed when trying to deal with a prospective tenant; otherwise, you may risk ending up with a lease agreement which is pre-terminated, and worse, having unsettled rental payments.
It would be wise and beneficial if you would be able to invest in tenant screening services to protect or secure your rented properties so that you will be able to gauge whether or not it will be favourable for you to enter such tenancy agreement with that certain prospective tenant or lessee. It is also critically important that you have tenants that you know will be able to pay monthly rent on time, preserve the property that you have rented him or her, as well as be admirable residents, too.
Though it might not appear necessary to take the time to screen those tenant applicants comprehensively, failure to do so would later on cost you significant time and expense. If you hastily decide to accept money from a prospective tenant that has cash on hand and ready to pay you right then and there, it might end up backfiring on you. It might also be a huge mistake if you just approve a tenant basing on his or her job just because you are very keen to lease out the property. It does not always mean that if the tenant applicant has a job then he or she has a good rental history. It does not also indicate that because the applicant has the deposit readily available, that he or she is a good payer and that he or she does not have any criminal record. As a landlord, a set of tenant screening considerations will help make sure that your tenant would not contribute to your neighbourhood’s crime rate. Having a tenant screened or doing a background check on the applicant will enable to fully verify and confirm that the person is representing himself or herself truthfully. This way, you would be assured that you are not turning a blind eye on potential dangers that might harm you, the neighbours and your property.
It is also really vital to carry out credit checks because most, if not all, landlords would never want to negotiate with someone who does not have good credit scores. Although nobody can stop you from contracting with those with bad credit, this could actually expose you from the chances of having late rental payments, or even worse, wasting time and effort in going after the lessee because he or she just suddenly disappears. In the long run, it might also mess up your credit score because you might not be able to fulfil your own credit obligations because your tenant or lessee did not pay on time. It would be best to know the financial capability of your tenant because it will provide you the certainty that said tenant is capable of paying his or her rent. With having this tenant screening, you are now discouraging those with bad credit scores from renting out your property which is actually beneficial for the business.
In addition, if you are the owner of the properties being rented out, naturally you would only want to enter in a contract with tenants that you are confident with that can take care of your rented property – as if it was their own. By screening out tenants, you will then have an insight on the way that certain lessee’s capability to carry out adequate care of your property. Doing background check will let you be aware of future problems such as history of substance abuse or the tenant being a part of a terrorist group. It is quite obvious that dealing with and being connected with these types of people will do no good, not only to your rented property, but also to you, as the landlord, and to your business. Doing tenant screening will aid you in revealing red flags about the tenant applicant before even entering to an agreement to lease your property.
In planning to avail tenant screening services, you should evaluate first which provider would be best to suit your needs. Since you are the primary owner and you know your business quite well, it would not be hard for you to come up with factors and standards which you think are acceptable or unacceptable when looking for tenants.
Although there are already several online tenant screening services providers, these providers just typically use only computerized databases to run background checks, making it more likely that only those readily available information such as credit histories and criminal records will be checked. This would then tend to leave out other investigative options that would necessitate talking with old landlords and other references. Moreover, online tenant screening services only check a number of databases for each person; therefore, they will simply tell you that the tenant is cleared for the background check if nothing turns up. On the other hand, a competent investigator will give you more detailed information about the tenant applicant if the standard background check does not turn up anything.
Although hiring an investigator is recommended to do a thorough background check, it is still not for everyone. It is an alternative choice which is more detailed and complete but, also, far more costly than doing online background checks. So it would be best to consider closely regarding all the possible risks you would take and your investment’s perceived value. Hiring an investigator is perhaps the preferred option for those long-term lease agreement, business and top-notch rental properties who would want a thorough and complete background check for potential tenants.
It is certainly not an easy feat to find the perfect tenant for your rental property, which is also one of the reasons why a lot of landlords would choose to hire property managers to manage their properties they want to rent out. It is of utmost importance to perform tenant screening to make sure you have the right tenants for you property, as this will not only ensure that you will find trustworthy and responsible tenants, but it will also give you peace of mind that your property is in good hands.