January brings the promise of a profitable new year for your rental business. Here are some suggested resolutions that undoubtedly will make 2017 a prosperous year for you:
Tip #1: Rent Payment History Now Included on Credit Reports
Landlords in Canada suffer a disadvantage when it comes to tenant screening reports. That’s because eviction reports are not readily available. Cases published in landlord-tenant tribunals do not reveal the tenants’ names. Appeals cases are discoverable, but it takes herculean effort to find a pattern of misconduct.
Likewise, criminal history can be difficult to locate, especially where the tenant has moved frequently or lived in different provinces.
In the absence of nationwide eviction and criminal reports, for Canadian landlords, a tenant credit report needs to do triple duty. Fortunately, this easy-to-obtain report can flag a number of chronic problems that make the rental applicant a bad risk.
So, for starters, landlords need to order a credit report for any applicant under serious consideration.
But it doesn’t stop there. In 2016, Canadian landlords gained a crucial tool in tenant screening — the ability to discover an applicant’s rent payment history.
By participating in the TVS tenant database, LandlordCreditBureau.ca, TVS landlords can report rent habits on a monthly basis. This offers an immediate incentive for tenants to pay rent on time. Landlord Credit Bureau stores this information, which is checked when the member landlord orders a credit report. The information now is being reported to Equifax Canada, so that tenant pay habits are included in tenant credit reports. See Report Tenant Pay Habits for more information.
Tip #2: Treat the Rental Application Like a Legal Document
In a recent court decision, a professional tenant who ripped off multiple landlords was convicted of fraud. This case was unique because the tenant was convicted for lying on rental applications.
That case and the reasoning behind it elevate the status of the rental application. Offering false information has consequences.
Are you treating it the same way?
One of the biggest mistakes a landlord can make is skipping this step. Without a completed rental application, it is nearly impossible to screen tenants. Talk about flying blind!
In addition to obtaining much-needed personal data about the applicant, the rental application contains the consent language giving the landlord the right to run a tenant background check. And, it contains the all-important declaration — the promise signed by the applicant that the information provided is true and complete.
Without that signed declaration, it is highly unlikely that a chronically bad tenant who scammed multiple landlords would have been convicted of fraud.
Landlord Tip: Warn rental applicants before they complete the rental application that they will be signing a declaration that the information provided is true and complete.
Tip #3: Make the Most of Your Rental Ads
A rental ad, when used to its fullest potential, is a powerful tenant screening tool.
There may be no easier way to prequalify applicants than to have them do it for you. That’s the advantage of a detailed ad.
List the material terms, including size, location and rent, along with the important qualifications, such as no-smoking or one car. This step alone can reduce the number of unnecessary phone conversations with unqualified applicants.
In addition, by setting a professional tone, you can discourage bad tenants who quickly will realize that you are not a pushover. Advertise that you require a tenant background check, and chase away habitually bad tenants looking for the next victim.
Consider the overall appearance of the ad. Likes attract. If you want someone who appreciates professionalism, be professional. If you want a tenant who will care for the property, don’t stick a weathered or tattered for-rent sign in the front yard.
Tip #4: Join a Landlord Association
Even if you’ve been at the landlord business for awhile, it is becoming increasing more difficult to keep up with changes to rental laws. Just this year, for instance, Vancouver passed a law regarding relocation of tenants, Alberta changed its rules to protect victims of domestic violence, British Columbia and Ontario are considering rules to end short-term vacation sublets, and Canada signalled it may legalize recreational marijuana.
At the same time, landlords are battling some of the existing rules, particularly those that give tenants an edge in evictions.
These are some of the most important reasons to join a local landlord association. These member organizations can help train new landlords, update experienced landlords, and offer voice when it comes to developing new laws that impact your rental business.
Tip #5: Update Your Tenancy Agreement
Tenancy agreements contain many of the necessary landlord protections needed to minimize income loss. For this critical property management tool to function at peak performance, it needs a periodic tune-up.
The best way to accomplish this is a sit-down with your legal adviser. Find out if your lease is up-to-date with recent changes in rental laws.
In addition, make sure the tenancy agreement contains all the necessary language needed to navigate new trends, such as the increasing popularity of short-term sublets, marijuana use, no-smoking preferences, and animals.
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 in 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.