Half the battle of managing rental properties is having good systems in place. Even if a landlord only fills vacancies occasionally, it’s important to have solid processes to rely on to avoid recreating the wheel with every new tenancy.
Landlords who stick with these basics can avoid bad tenants and reduce liabilities:
1. Credit is important, but don’t forget to check an applicant’s rental history.
Tenant credit checks will tell a lot about a person’s financial responsibility and chances are a bad tenant will have bad credit. However, not every landlord pursues legal action against a problem tenant, and sometimes these repeat offenders slip through the cracks. Check the database at Landlord Credit Bureau for red flags. Review the rental history that appears in the rental application, confirm the dates of occupancy, and speak with the previous landlords.
2. Keep records of conversations, repairs, property condition.
A landlord recently won an arbitration against a tenant who had caused a fire in the bathroom. The landlord’s success was directly attributable to keeping good records — a condition report when the tenant moved in showed no fire damage in the bathroom and the condition report completed when the tenant moved out did show damage. Providing documentation bolsters a landlord’s credibility in dispute resolution, increasing the odds of recovering the full amount owed.
3. Landlord liability corresponds to tenant safety.
The higher the risk of injury to tenants, the higher a landlord’s liabilities, so focus on ways to keep tenants safe. Fires are a high risk to tenant safety and can generate significant fines for rental property owners who fail to protect tenants. Be sure that smoke and carbon monoxide detectors are properly installed and in working condition and exit routes are clear. Also, take measures to prevent crime — outside lights, door and window locks — and injuries from falling.
4. Cash flow is a vital factor in profitability.
Landlords can’t afford to leave monthly rent payments to chance. Tenants need to be accountable. The best way to do that is to Report Rent Payments through TVS so that payment history is filed with a credit bureau. Include the Notice to Tenant in the lease agreement. This method not only promotes cash flow, it serves as an incentive to renters who wish to build good credit and a strong rental history. Tenants can obtain a Certificate of Satisfactory Tenancy to show to the next landlord.
5. Stay in touch with your tenants.
A landlord’s seeming absence will foster income loss, including late rent payments and property neglect or damage. Tenants need to be managed, and don’t like landlords who dump those responsibilities onto them.
Create a system where tenants receive regular communications. Perform routine property inspections. Take the responsibility of managing the rental property seriously, and tenants will be more likely to meet their responsibilities.
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.
