How to Spot Applicants with Bad Rental History

by Chris on September 11, 2017

Multiple evictions for failure to pay rent or causing property damage is as bad as it gets when it comes to rental applicants. Unfortunately, landlords can’t easily access prior eviction information or court records. So, landlords have to read between the lines and watch for red flags to uncover an applicant’s rental history:

Know the Warning Signs

One popular strategy employed by applicants with a bad rental history is to tell a sad story — someone in the family has cancer, the applicant just lost a loved one, was mistreated by the previous landlord — the list goes on and on. Professional tenants can be brazen and completely convincing in their stories. It may be true, or it may be a manipulation. Either way, that information is not relevant to the tenant screening process. Rental properties are a business, not a charity.

Tenants who are currently undergoing eviction or who have a bad rental history may try to move in immediately. This is another common ploy to avoid a tenant background check. They might offer some concession like cash on the spot or higher rent. That may be the only money a landlord will ever see from that tenant.

A similar variation is the tenant who asks to defer payment of the deposit or first month’s rent for some sad reason — the kids are sick, the dog just died, the husband is out of town, and so on. The person wants to move in now, and then pay later — or maybe not pay at all.

Desperation is a red flag. An applicant who is about to get the boot wants to make a deal quickly in order to move into a new property with a new landlord to victimize. This is particularly suspicious when the applicant is trashing the current landlord or asking that the landlord not be contacted, either because that landlord is being “unfair”, or because the current landlord’s “feelings will be hurt” once he or she finds out the tenant is moving out early.

Another possible problem is the applicant who wants to rent only in one name despite listing multiple adult occupants. The applicant who is doing all the talking might have a good rental history, but the proposed roommates could be tenants from hell.

Prequalify Applicants

Prequalification of rental applicants is an important step to cutting down wasted time and energy. At the same time, those prequalification questions can signal a tenant with a bad rental history. For instance, find out if the applicant:

Is moving prior to the end of the current lease;
Is breaking the lease in order to move;
Has failed to give notice to the current landlord; or
Wants to move in immediately.

An applicant who is leaving early may be in process of an eviction or may not be respecting the terms of the current tenancy agreement.

Once the applicant has answered these and other prequalifying questions, record the answers and check that the story stays the same. Inconsistencies are a sign that the applicant is not being truthful.

Ask the Applicant

While it might seem futile to ask applicants if they’ve ever been evicted for failure to pay rent or because of property damage, there certainly is nothing to lose by asking. If applicants realize that the answers provided on the rental application must be verified by the tenant’s signature, and that lying on a rental application constitutes fraud, bad tenants may change their minds. Also, that signature and rental application can be used to prove fraud.

Pay attention to previous addresses on the rental application. Make certain these are legitimate places, and the residence addresses match the landlord references provided. Also, check dates of previous rentals for strange gaps or omissions.

There is a chance that the applicant might be forthcoming about previous difficulties. In that case, a landlord can consider the circumstances and the applicant’s efforts to rehabilitate when processing the application.

Ask the Previous Landlords

One of the best ways to spot an applicant with multiple evictions or bad rental history is to talk to the current and previous landlords. This eliminates the possibility that the tenant is currently undergoing an eviction, or has a long history as a professional tenant who steals from landlords. Screen the reference to confirm that the person is the current or previous landlord, and have a list of questions ready beforehand. It is helpful to know if the tenant:

Is currently being evicted or was evicted in the past;
Lost the security deposit due to excessive property damage;
Paid rent on time; and,
Is moving at the end of the original tenancy or after providing notice to the landlord.

In the case of multiple applicants, the best practice is to add all adults to the tenancy agreement and demand a rental application, with consent to run a tenant background check, on all proposed occupants. That way, the landlord can ask for previous landlord references from each proposed tenant. Otherwise, the original tenant might leave and those unvetted occupants may wind up staying in the rental property.

Check the Applicant’s Credit

The tenant’s credit report may be impacted by an eviction, unpaid rent or claim for property damage. It’s not uncommon for tenants who fail to pay the rent to have a history of defaulting on other revolving charges as well. Bad money management and poor financial decisions spell income loss for landlords who rent to these high risk tenants.

TVS landlord members now can report rent payments to Equifax Canada. At the same time, member landlords can check the database provided at LandlordCreditBureau.ca for an applicants rent history.

 

This post is provided by Tenant Verification Service, Inc., helping landlords reduce the risks of renting with fraud prevention tools that include Tenant Screening, Tenant Background Checks, (U.S. and Canada), as well as Criminal Background Checks, and Eviction Reports (U.S. only).

Click Here to Receive Landlord Credit Reports.

Disclaimer: The information provided in this post is not intended to be construed as legal advice, nor should it be considered a substitute for obtaining individual legal counsel or consulting your local, state, federal or provincial tenancy laws.

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