Being a successful landlord hinges on finding well-qualified tenants that pay on time and do not cause damage to the home or trouble in the neighborhood. Experienced rental homeowners know that this is easier said than done. Indeed, many can tell horror stories of nightmare tenants they could have avoided if they had been more careful during the selection process. Let’ see five tips to find a well-qualified tenant.
Selecting tenants can be a tricky process. To remain on the right side of the law, landlords cannot discriminate against applicants due to race, gender, nationality, religion, disability, or family status. However, they can apply other criteria to the application process to find well-qualified tenants. Here are some:
Verify income and employment status
According to a Denver rental agency, successful tenant applicants should be earning 2-3 times what their rent will cost to ensure affordability. Local Denver companies like Evernest, Mynd Property Management, and HighPoint Property Management insist on seeing applicants’ paystubs to determine their monthly income. At Evernest, agents believe it is vital to assess whether prospective tenants will manage to pay their rent. If their earnings are insufficient, agents deem them a rental risk as there is every chance they will default on payments, leading to lengthy evictions processes that can take months to resolve. Evernest is an established property rental company in Denver and has branches in Atlanta, Georgia, and Memphis, Tennessee, among other metropolitan centers. Some landlords prefer to work with large multinational rental property management services, such as BH Cos. and Bozzuto.
It is not enough to see an applicant’s paystubs to determine their suitability as a tenant. A quick telephone call to their current employer will verify any employment details the applicant provided. If a prospective tenant has only been in their present job for a few months, ask for their previous employer’s contact details. A conversation with an applicant’s employer starts creating a picture of who they are.
Verify credit history
Few potential tenants will own up to having credit problems, and this is something landlords and property management agents should investigate independently. There is no point in taking on a tenant who earns enough money but spends most of it servicing existing debt, such as credit cards and loans.
An applicant’s credit history is a vital component of determining their suitability as a tenant. Everyone gets into debt, but how they treat it distinguishes them from others. People who run away from and do not pay debts are unlikely to have their rent money ready on time each month. A credit history creates a picture of how responsibly someone has behaved toward debt in the past. It is a critical indicator of how they will do so in the future.
Speak to references
Many tenant application forms require applicants to fill in names and numbers of people who act as references. Few landlords take the time to call these people and speak to them about the applicants. Many do not stipulate who they want as references, leading to a skewed perception of the applicant because the form only lists people who speak well of them.
A rental property owner can ask for an applicant’s previous landlord’s contact details. A conversation with this person could be enlightening as it reveals the applicant’s previous behavior when renting a home.
Landlords have the right to know whether prospective tenants are convicted felons as they can exclude them as applicants. However, determining this could be challenging as not everyone is entitled to ask law enforcement officials to run a criminal history check on someone.
However, landlords could speak to local authorities to determine if they know the tenant and share any information about prior incidents. People with a history of making trouble are not ideal tenants.
Once a landlord has whittled the applicants down to a shortlist, an interview should follow. During this interaction, the property owner can ask additional questions about the prospective tenant’s employment, credit record, and what the conversation with their previous landlord revealed, including an eviction history.
Landlords can also ask about pets as this could be an important consideration and should form part of the rental agreement. Other questions should include finding out why the applicant is moving and asking about their relationship with previous landlords.