Tenant screening is essential for securing the most qualified renters while taking the fewest risks.
Part of your tenant screening process should be evaluating the references your applicants provide. It’s not enough to simply ask prospective tenants to list them on your rental application. You should also ask for contact information for the references and follow up with them.
There’s no better way to get first-hand insight into a potential tenant than hearing from those who have worked closely with them. This means talking to current/former landlords and employers.
These individuals can help you zero in on pieces of a prospective tenant’s background and history that might indicate how they will behave while renting your properties.
Here are a few questions you should always ask tenant references and how to evaluate them.
Former landlords are a great resource you can use to learn about a potential new tenant. The fastest way to know whether a potential tenant will be a good one is to ask their former landlord.
The first thing you’ll want to find out about prospective tenants is whether they pay rent on time. Did they make a habit of making late payments? Did they always honor late fees and grace periods?
An occasional late payment doesn’t necessarily mean someone is a bad tenant, but patterns should jump out at you. Ask their former landlord whether they would have been happy to continue to rent to the tenant given their habits.
A former landlord can also tell you about their tenant’s behavior. For instance, did the tenant’s neighbors often complain about them? What about the frequency and relevancy of the tenant’s own complaints?
If neighbors were frequently dissatisfied with the tenant, this is a sign that they might not be a great addition to your resident community.
Did the tenant smoke? Do they own pets? Were their guests respectful? It’s important to ask questions like these to learn about a prospective tenant’s habits.
An experienced renter is more likely to have developed good habits. For example, they know how to respect other tenants and their landlord’s property. If a former landlord expresses concern about a renter’s habits, consider the damage they could potentially cause to your business or property.
Why the Tenant Moved Out
Why is the tenant seeking new housing? If their previous landlord evicted them, this is an obvious red flag. However, still ask for the circumstances and details of the eviction and confirm them with the applicant.
Employer references are another important piece in any tenant screening report. Call an applicant’s employer to verify their employment, income, and job stability. You can also learn how the potential tenant’s behavior at work might predict their suitability to rent your properties.
The first thing you’ll want to ask a former/current employer is whether the applicant indeed works for them. Next, ask them how long the applicant has worked there and confirm that they make the salary or work the number of hours they listed on their application.
Will the employer continue to employ the prospective tenant in the future? This question helps you evaluate their job stability and long-term outlook. If the applicant is already struggling to keep their position, they might have trouble paying their rent in the future.
Try to get a sense of whether the prospective tenant is invested in their current job. While they may be seeking a better position or looking for a change, an employee who shows consistent disregard for their job might also show that same neglect for their rent responsibilities.
Are there any behavioral issues at work that you should know about? Does the renter get along well with their boss and coworkers? Questions like these can help you ascertain whether the prospective tenant will be a positive addition to your resident community.
Tackling Tenant Screening
Tenant screening involves many moving parts. Between credit checks, criminal and eviction histories, income, and rental applications, you may be tempted to skip calling references. However, you should never do this. Don’t miss out on this chance to learn about your possible new tenant from first-hand sources.
If tenant screening is too much to juggle, remember that most property management software platforms offer tenant screening features that can handle much of the workload for you. With concise screening reports paired with direct information from previous landlords and employers, you can be sure to gather enough insight about your prospective tenants to make the best decisions for your rental business.