Tenant screening is a two-part process. A landlord must verify credit-worthiness — the ability and willingness to pay rent, along with tenant-worthiness — the applicant’s rental history. Running a tenant credit check is crucial for determining if the applicant tends to pay the bills. But credit alone may not expose a tenant who has broken a lease agreement or caused property damage. To do that, a landlord must:
Ask for the previous address history in the rental application. It’s typical to go back three years, so be sure to include enough room for the current address and previous residences. Require the applicant to note the dates they lived at those locations.
The rental application also must include a signed consent to run a tenant background check. This is necessary to run tenant screening reports and to speak with previous references. Occasionally, a landlord reference may ask to see that consent before providing the information.
Review the previous residence history. Is it complete? Look for omissions, like missing street numbers, that might be a clue the applicant would rather not share the information. Then, run through the dates to see if there are gaps or overlaps. If so, ask the applicant to explain the discrepancy.
Pay attention to which landlord references have been supplied. Is it one from three years ago? Ask to speak with the current landlord and the most recent previous landlords.
When calling on a landlord reference, use a script or checklist to solicit helpful information. At a minimum:
Confirm the property address and the dates the tenant lived there;
Find out if the tenant routinely paid rent on time;
Ask if the landlord needed to withhold deductions from the security deposit;
Find out if the tenant left at the end of the lease agreement and provided notice;
Ask if the tenant was the subject of complaints from other tenants or neighbors, or if the tenant made numerous complaints;
If applicable, ask if the tenant smoked, or if the tenant has a pet, if that pet was well behaved; and,
Ask if there is any reason to avoid this applicant.
There is always concern that the landlord reference is not legitimate. By using the script, it will be easier to determine if the person on the call is actually a landlord. Most fake references are coached to give generic answers, and are easily stumped by specific questions.
Another way to deal with a possibly fraudulent reference is ask landlord-friendly questions like “How do you deal with marijuana in your properties?” or “Have you gone non-smoking?” Come up with a question that can be independently verified, like “How many units are in the complex?” or “How long have you owned the property?” Or, simply tell the reference that you need to confirm that they are the landlord and ask them to help you work that out.
If the reference flags legitimate problems, be sure to get specific details. Allow the reference to talk freely, even if it’s more information than necessary, but filter out any personal biases, especially any racially-charged comments. Those comments cannot be used to reject an applicant.
Along with checking references, run tenant screening reports. Bad credit overlaps into rental history if the tenant has been sued for past-due rent or property damage. Run national eviction and criminal checks along with the credit report, and then look for information on those reports that contradicts the rental application. For instance, a criminal charge or eviction might not match the previous residence history.
LandlordCreditBureau.com is a database of both high-risk and low-risk tenants. TVS member landlords access this information, including rent payment and property damage history, when ordering a credit report. Membership is free.
Landlords who Report Rent Payments can provide a Certificate of Satisfactory Tenancy to exiting tenants. That document will demonstrate a good rental history.
No rental applicant is perfect, but lies or omissions on the rental application flag dishonesty, and that’s going to be a problem. To the extent that the rental applicant is forthcoming about imperfections, it may be worth considering the application. To the extent the person experiences chronic problems or attempts to conceal those problems, this might be the tenant from hell.
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.