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Tenant screening: Best practices go beyond the rental application (part 1)

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Multiple times each week, a landlord contacts our property management company because things have gone badly with a tenant.

There are a variety of contributing factors, some of which cannot be controlled, but shockingly, it is not uncommon to learn that the landlord never screened the tenant.

When asked if the tenant was screened, the common response from the landlord is, “Yes, I had the tenant complete a rental application.” Unfortunately, if the completion of an application yields a good enough feeling about a tenant, the screening process typically ends there.

Over the years, and the review of thousands of applications, we have honed our tenant screening process to be quite effective. Not all negative events can be foreseen, but recognizing factors that typically contribute to negative outcomes gives you your best chance of avoiding them.

Recognizing factors that contribute to negative outcomes means knowing how to screen a tenant.

We have used a variety of so-called automated screening services that range from $10 to $75 per tenant application, but found our custom internal screening process to be far more effective. The screening services are generally cumbersome, full of useless and incomplete results, and provide far less value than what you can do on your own once a good process is in place.

How do you start putting together a good tenant screening process? Determine what information is important when it comes to making an informed decision about a potential tenant.

We have found that information includes, but is not limited to: residency history, employment history, verification of income, landlord reference, credit report, landlord/tenant complaint search, criminal record search and identification.

All of this information can be obtained with a thorough rental application and a few easily accessible websites.

Critical to a good tenant screening process is ensuring the reviewer understands the data and that there are sound policies for the review. There are caveats to each segment of the screened data.

Stay tuned for my next post, where I will give tips to analyzing each piece of information collected during the tenant screening process. Remember, with a sound understanding of the data, the process of choosing a successful tenant can be achieved more often than not.

• The subleasee: The case of the mystery tenant • Broken leases: Better to use honey or vinegar? • Renting vs. selling your home: Pros and cons • 3 things to consider when choosing a property management company • Your year-round property maintenance checklist

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