When a prospective tenant inquires about a property on your roster, you may be tempted to trust the information provided on the application form. Unfortunately, on occasion, tenants may misrepresent their personal information in an effort to quickly secure a particular housing unit. Even without considering the nature of the misrepresentation, a failure to meet all of the given requirements indicates a poor match between the rental property and prospective tenant. If you leave the tenant acquisition process in the hands of a property manager, however, all interested applicants will be screened thoroughly using several information verification checks. That way, you can rest assured each one of your properties has a tenant well suited for that particular housing option.
Property managers make sure all prospective tenants are making a financially sound decision by comparing gross income amounts to the rent total. To stay in good shape moneywise, tenants should make at least 2.5 to 3 times the monthly rent amount. After paying for housing, tenants need to have enough for utilities, transportation, health, food, clothing and all of the other household expenses. To prove their income, tenants must supply check stubs or bank statements for at least three months prior to the move in date.
A strong rental history indicates the tenant does not break local noise ordinances, wreck the property or fail to pay rent, resulting in an eviction. The rental history should show compliance with the community rules, including parking requirements and rent payment dates.
Rental history may come in the form of back-to-back completed leases or contact information for prior property owners dating at least three years back. The property manager will personally verify each form of proof to confirm the tenant meets the given rental standards. You can elect to have tenants who meet all of the other qualifications but do not show a favorable rental history provide an increased deposit to rent the property out for a short three to six month trial period. If the rental arrangement works out by the end of that period, the tenant can then choose to sign an extended lease.
Your property manager will also use a full background check to rule out prospective tenants with a violent or destructive criminal background. The background check usually covers a period of five years and lists all misdemeanor and felony crimes.
Depending on your property locations, you may be able to deny any tenants with criminal backgrounds, but you must apply that ruling across the board. If you are willing to work with specific tenants despite their background, you must open up that option to all other applicants in that same situation.
Notify your property manager about which red flags necessitate a full denial and those which can be rectified with an increased deposit. As your property manager goes through the screening process, all rejected tenants will receive a detailed letter indicating the reason for the denial. Tenants may use the information to improve their background and try again at a later date.
Trusting The Screening Process
Although your assigned property manager completes the screening process, you can remain in control of the parameters used to find the perfect renters for each property. Of course, if you would rather not have a say in the findings, you can have the property manager use a standard set of requirements for tenant acceptance or denial.
Either way, without having to handle tenant screening directly, you can reap the benefits of renting out your properties without all of the associated difficulties. You can also leave quite a few other tasks to the property manager, including, but not limited to, rent collection, maintenance, repairs, move out inspections and property preparation services required to ready each unit for new tenants. For more information, contact a local property management company.