Approving tenants for a lease can be a little bit of a process, with several steps you should follow. It all starts with the rental application, which involves gathering a great deal of information for you to review and verify. The purpose is to help you determine the chance of an applicant being a long term, reliable renter. The information on the application will also help you determine if the candidate will financially be able to uphold their end of your lease. There are many websites out there that provide a template for a rental application, or you can make one yourself.

Necessary information

On the application, there is certain information that you need to have on file. Of course, you will need the basic information such as name, date of birth, social security number, and a good contact number. You will also want to ask the number of people that will be living with the applicant, their work history, income, housing history, and previous landlord references. You can request personal references but there is a chance that it won’t really help. Of course, no one is going to give someone as a reference that won’t make them sound stellar, even if they aren’t. Also, if you will be doing a credit check and/or background check, also include a consent form for release of information or include consent in the application. Be sure to abide by the Fair Credit Reporting Act or consult with an attorney to make sure that you word everything properly.

Verifications

Once you receive and review the filled-out application, you will need to verify the information. If you need any documentation, make the applicant aware of the requirement as soon as possible. This way you can keep the process moving. Ask for a copy of identification to verify they are putting the correct information on the application. Also ask for recent bank statements or check stubs to verify their current income. You can call their current employer as well. Certain laws will prevent the employer from divulging too much information, however you can verify that they are currently employed and get a reference from management. You can ask about the length of their employment as well as attendance to see if they are stable and reliable. If they change employment every couple of months it may be a red flag for a long-term leasing situation.

Also verify their previous housing information. If they have multiple short-term addresses listed this may indicate that they could be a short term tenant with you as well. Call previous landlords to confirm what kind of tenants they were previously. Ask if they paid rent on time, if they gave notice, caused damage and if they kept the unit clean. Make a list of questions to ask each contact and record their responses to keep with your records. This will help you make your decision, especially if you have a couple close candidates and you want to go back and compare your notes.

Applicable Screenings

If you are wanting to do background and credit checks, this should be made known in the prescreening process. You will need all names they have used, date of birth, social security number and previous addresses to run these reports. You can run these reports online and you can also check local courthouses to get background check information. There are some services online that do all the research and send you the report but they usually charge a fee to do so. This is something that you can choose to pay or include the fee in the application process.

Doing a credit check will help give you an idea if the applicant is financially responsible. You will be able to see if they have any current debt payments and compare it to their current income. This will help you determine if they will reasonably be able to pay rent each month. It will give you a sense of their reliability based on their payment history and will also show any evictions, civil suits or bankruptcies on file for the applicant. This, along with the references you receive, will help paint a picture of what you can expect from this candidate as a paying tenant.

A background check can be particularly helpful for a landlord. You are placing your trust and your property in the hands of a person you don’t really know and have only met a handful of times. This will show you any criminal charges against the applicant. You can see federal, state and county records as well as any reports from the Sex Offender registry. Thebalance.com gives a few points of caution.

  1. Certain states, such as California, prohibit landlords from discriminating against renters with certain criminal convictions. As a landlord, you may have an easier time justifying your rejection of a prospective tenant with a drug or violent crime conviction than you would rejecting a tenant with 50 speeding tickets. This is because drugs or violent crimes can jeopardize the safety of other tenants.
  2. There is no nationwide database of criminal records, so it may be hard to do a thorough background check.
  3. Doing a criminal check yourself can be very time-consuming. It may be best to hire a reputable tenant screening company to perform this check for you. It can often be combined with the credit check, for an additional fee of course.

So, keep these in mind when doing your searches and making your decisions.

Conclusion

The application and verification process might be a long, difficult, and time-consuming process. However, it is also a very important precaution. This information and your instinct based on a very limited contact with each candidate is all you will have to make your decision. You are going to place your trust and your property in someone else’s hands. So, you want to be sure that you have all the information available to ensure that you make the right decision.

1 COMMENT