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There are two goals in tenant screening: weeding out bad tenants, and not weeding out good ones. You want to avoid filters that lead to false positives (a good tenant setting off the red flag detector) or false negatives (a bad tenant comes through undetected).
In this article, we’re going to list the do’s and don’ts of tenant screening to help you find your next great tenant and warn you of screening practices that can lead you astray.
There’s value in trusting your gut, and in evaluating applicants’ character when you meet them. But don’t let your own biases mislead you, and don’t rely on lazy assumptions. There are all kinds of good tenants, who look and act in many different ways and come from many different backgrounds.
It’s one thing to look for clues actually relevant to the lease (e.g. cigarette pack on an applicant for a nonsmoking unit). But approaching all interactions as a chance to play Sherlock is a recipe for over-weighting insignificant information. And it may even get you into trouble with fair housing law.
During the screening process your goal is to find out as much relevant info about the potential tenant as you can. It’s understandable to not want to make the applicant uncomfortable. But as long as you’re respectful and professional, there’s value to both you and the applicant to being a little nosy to find a great tenant.
Try to direct the conversation and find out as much as you can about the tenant over the phone before scheduling a showing. This will give you time to think on their responses and follow up on certain topics during the in-person if you think of any concerns.
Let the applicant know that you’ll require a tenant check. This will help scare off high-risk or shady tenants, and gives legitimate applicants a heads up on what to expect going forward.
During the showing, while perspective tenants are walking around, get them to tell you more about themselves, their roommate, their employment, and any other relevant factors before taking things to the application stage. Save the negotiation for later, when you’re sure you’ve found an applicant you’re confident in.
The application itself is your best chance to flag problematic responses and get to the bottom of whether the applicant will be reliable. Make sure the questions you ask all comply with Fair Housing and that the tenant knows all of them must be answered.
Naborly’s online application requires that all questions be answered or set to N/A, and our process is structured to prompt tenants to answer honestly and provide the information most relevant to screening.
It’s natural to want to rent an empty property out as fast as possible. But cutting corners or rushing to get someone in as soon as possible may come back to haunt you later.
Not taking the time to get good pictures and write a good listing will result in fewer and lower-quality inquiries.
Not taking the time to properly screen a tenant often results in less-than-ideal renters who might be gone again in the next half year. Or worst, professional tenants who pounce when they see signs of a landlord’s urgency (especially in ads) and take advantage of those who compromise proper screening practices to fill their rentals a month earlier.
Bad tenants could likely end up costing you way more than what you made by renting early. Do your diligence: take an extra month if you need to, and view that month’s lost rent as an investment in making sure the next year or more will work out.
Read up on Fair Housing laws in your regions, and if necessary, consult legal advice to make sure your screening factors are all allowable based on national and local laws.
The most common protected classes under housing law are race, national origin / citizenship, religion, age, sex/gender, disability, or family status. But in some places it is also forbidden to discriminate based on various other factors such as sexual orientation, gender identity/expression, source of income, social condition, receipt of public housing, personal politics, or having a pardoned conviction.
Here are some resources to start with:
At Naborly, our screening process and application form are fully compliant with international Fair Housing Regulations, so that landlords don’t have to worry about encountering Fair Housing complaints.
First, gather qualitative information about the person’s move, suitability, and rental history by asking them appropriate questions: Why and when are you moving? Who else will be moving in with you? Have you ever been evicted? How do you plan to pay rent / how much do you make?
If an answer raises a red flag with you, try to find out what the reasons are. An eviction from an old building being renovated is different from an eviction for too much partying. A person making x salary with a lot of debt is different from a person making the same salary with a lot of savings.
Second, asking for the things you’ll need for further screening, for example, written content to pull a credit check. If the applicant is unwilling to provide you with references or written consent for a credit check, then at worst this person may have something to hide, and at the least it means you won’t be able to properly compare them to others you’re screening.
Make sure you include a questions about pets if you (or your building)have a pet policy. If you do allow animals, it’s worth knowing what kind and how many.
You want to be able to verify the identify, income and employment to your applicants. The simplest place to start is to ask for government issue ID and a supporting piece of Identification.
Make sure the personal documents provided to you are real and legitimate, and the contacts and references you’ve given are actually belong to them.
You can do this verification manually by searching and checking land registries, or you can outsource it to a professional screening service like Naborly.
Sometimes you don’t have the time and patience to deal with screening tenants on your own. A screening service like Naborly takes the work of verifying and evaluating tenants off your hands. At Naborly, we use an 8-point verification system to confirm Identity, Income, and Employment, and our algorithm is able to identify risks that most landlords miss. Our data-driven process eliminates the biases and flaws in manual screening and focuses on identifying the factors proven to be associated with good and bad tenants. You can learn more about our tenant screening process to determine if it’s right for you.
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