While vetting prospective tenants may seem uncomfortable and invasive, it’s a critical part of the application process and ensures that you and the applicant are the right fit for one another. The best way to do this is to screen every tenant equally, fairly, and uniformly. To help you find the best possible renter for your vacancy, read on to learn how to properly vet tenants for your rental property.
Be Aware of the Law
Knowing the law will save you from potential litigation, so don’t skip out on studying up! While federal law generally takes precedence, there are things federal law leaves up to the states, such as the legality of criminal background screening. To start you off on the right foot, let’s take a look at federal law and what it says about screening tenants.
The main law that you need to be aware of is the Fair Housing Law. This law states that you cannot discriminate and refuse housing based on a person’s race, ethnicity, religion, sex, disability, or familial status. Additionally, some states have their own fair housing rules that include sexual orientation and gender identity as part of the protected people on the list.
Know What You’re Looking For
Knowing your expectations of a tenant will help you choose between applicants later down the line. It’s important to ask yourself what you find important and how you want your rental property treated. Or, in other words, what is your ideal tenant like? Of course, no one wants a tenant that will vandalize and destroy their property, but there’s more to it than just black and white.
How do you feel about tenants who smoke or own pets? Do they maintain the cleanliness of the property? How respectful and responsible are they? While you shouldn’t judge a tenant solely based on your idealized version of a person, if you’re choosing between a small pool of tenants, keeping these qualities in mind can make the decision process easy.
The pre-screening process can help you further narrow down your search and be a little bit pickier about who you allow to apply. In the end, you get a high-quality pool of applicants instead of just anyone and everyone. On your rental listing, put what your expectations are, such as monthly rent, security deposit, as well as your pet and smoking policies. You should also explicitly state that you will be conducting a background check that complies with your state and local laws, so they know what they’re signing up for.
Next, you can conduct a short interview over the phone to ask them questions and get a feel for their personality. Some potential questions could include how many people will be living there, why they’re moving, and how long they’ve lived where they are currently. As long as your questions are non-discriminatory, you’re good to go! You’ll also want to tell them a little bit about the application process and what it entails. And if you feel comfortable with the results of the conversation, you can send an application right to them if you’d like.
Fill Out Application and Check References
Filling out the application is the easy part, as you just have to wait for the applicants to send it back to you. However, the application should have a few key elements to protect you. There should be a portion of the application for them to sign that states they allow you to run a background check (whatever that entails for your state) as well as a credit check. Your application should also have a place for them to list work references, rental history, as well as landlord references. This way, you can get a better idea of their rental history as well as their ability to pay for the unit.
Once you’ve done this, you should follow through on those references and give them a call. Work and past rental references will give you a better idea of who they are as a renter and what their financial history is like. If they have spotty work or bad reviews from their landlord, this could be a red flag and a sign they might not be the right fit. In these cases, it’s best to ask the applicant’s side of the story to avoid misunderstandings, as you won’t get the full picture from one person. It’s always important to remember that renters are people too, and that anyone is prone to mistakes.
Conduct a Formal Screening
Once you’ve followed all these steps, it’s time to conduct a formal screening. Typically, you will pay for some form of a tenant screening service, such as an application, to run a report on their credit, criminal, or eviction history. Remember that some states do not allow you to run a criminal background check, so stay up-to-date on your formal tenant screening laws, as it can be considered discriminatory in some areas. Formal screenings can also conduct a review of employment history, income history, and any other public records available. All of these things together can give you a better picture of the applicant as a whole.
While conducting a formal screening may not give you an idea of who they are as a person, it is important to remember that your business is a business. It can be hard to look at these things through the lens of a business operator, but that’s what you have to do. You may get along with an applicant very well, but if they can’t afford your property or aren’t a good fit, then that isn’t good for business. Sometimes the most pragmatic and decisive decisions are the hardest to make, no matter how good for business they may be. Ultimately, it is up to you to decide who you feel would make a good tenant, so use your best judgment, follow your gut, and you’ll be well on your way!
Now that you know how to properly vet tenants for your rental property, you’re ready to fill any and all future vacancies with the best tenants as fast and efficiently as possible. But if you’re still working through the screening process or finding the right tenant, Excalibur Homes can help. We’re a property management company in Nashville dedicated to helping landlords every step of the way, including the marketing, screening, and leasing processes.