Owning rental property is often a wise investment, but it's a big responsibility. There's some work you must do to vet the individuals who will occupy your rental property. If you choose poorly, you could lose money or suffer property damage.
You have to perform a thorough tenant background check before they sign a lease application. If you're interested in knowing more about the tenant verification process, we can help.
Here's a guide to successful tenant screening.
Set Minimum Application Requirements
Create some reasonable expectations for prospective tenants. Some benchmarks to consider include their credit score, median household income, and employment history. If you set expectations too high, it could lead to your property sitting vacant longer than it should. Setting it too low could leave you with a problem tenant.
Require a Completed Lease Application
A rental application provides a landlord or property manager with important information about potential tenants, including:
- Current employment
- Employment history
- Gross income
- Previous addresses
- Contact information
- Monthly debts
- Personal references
Consider each prospective tenant as an individual. Depending on the circumstances, you may choose to allow for some flexibility in your requirements.
Run a Rental Background Check
A person's credit score is often a reflection of their financial responsibility. If someone's credit score is low and they have a history of not paying their bills on time, you can expect them to repeat this behavior.
A rental history will provide information about a prospective tenant's previous address and contact information. Background checks reveal whether or not they have an arrest record. Public records provide information about outstanding medical bills or unpaid child support, which could affect an applicant's ability to pay rent.
Speak With Their Employer and Landlord
After viewing screening reports, take the time to call to verify if the information is correct. Speak with their employer and landlord to assess reliability and trustworthiness.
You could find out they no longer have a job or haven't taken care of their current rental. It's always a good idea to ask whether a landlord would rent to the applicant again.
Interview the Applicant
After you have conducted the proper tenant screening measures and they have met the minimal requirements, take the time to interview them. If possible, conduct a face-to-face interview. Some steps to take during an interview include:
- Verify the information they provided on the rental application
- Discuss any discrepancies you notice
- Provide the applicant with time to ask questions
- Discuss their pets if the property is pet-friendly
Rental properties are in high demand in many parts of the country. You may have multiple applicants to choose from. A professional property management company can help you screen tenants and find qualified prospects.
The Importance of a Tenant Background Check
Owning investment property is a worthwhile endeavor, but managing your property and tenants can be time-consuming. If you're busy with other things, a professional rental property management company can be a lifesaver.
They can conduct a tenant background check and handle the lease application to ensure a thorough tenant verification process. PMI Los Angeles provides full-service property management and commercial management. We're here to handle all of your property management needs.
Contact PMI Los Angeles today to learn more.
