Did you know that over 100 million people in the United States rent, rather than own property? If you are a landlord, this is an excellent time to invest in new property and find tenants to rent it out.
To weed out the best tenants, you need to use a tenant screening method. Although the process may seem a little daunting, it does not have to be. Here is a breakdown of what you should look for and talk about with potential tenants so all parties are on the same page.
Describe Your Ideal Tenant
Before you put out a listing, you need to know who your ideal tenant is. You may not find someone that checks every box, but it is always good to have requirements before moving forward with the process.
Think about factors such as income level, job, family size, and how long they plan on renting, to start with. This will help you to narrow down applicants, especially if you receive quite a few rental inquiries once you post your listing.
Rank the requirements from most to least important. You can get an idea of what you value in a tenant most and what you may be willing to compromise on if you find someone who is a solid fit.
Write a Detailed Listing
When you advertise your rental, leave no stone unturned in your listing. You may think that a long listing will put people off, but the more that you get out in the open, the better.
In your listing, include information such as cost, maximum people in a home or room, your pet policy, bills and their due dates, and other vital data.
In addition, this will attract more serious renters who care about how you screen tenants. They will take the time to read the listing and respond to your ad accordingly.
One technique you can use to make sure someone reads your listing is putting a code word near the end. Ask people to send you the code word when they reply to the listing.
Advertise in Multiple Places
Do not just limit your advertisement to one site or location. To get the most interested applicants, you may need to put in the leg work, physically and socially, to put up your listing in a variety of environments.
This also depends on the type of tenant that you want. For instance, if your listing is geared towards seniors and retirees, you are more likely to find renters by advertising in the newspaper or in local places, such as coffee shops.
Many social media sites like Facebook have rental and housing groups for areas all over the country. Members need to answer screening questions to become a member. It is a great place to meet local people in your city, and landlords and tenants can converse over listings.
Check Employer References
Part of your tenant screening checklist should be to evaluate employer references. This will give you a good idea of how dedicated your tenant is to their job. If they have a better prospect of keeping their job, they are more likely to pay rent.
Ask the employer how they are at turning work in on time and completing tasks. This is a good indication of how well they will be able to give you payment for rent and other bills.
Use a Screening Tool
If you have multiple units you need to rent out or you simply feel overwhelmed with the tenant process, then you should consider using a screening tool. This will help you to stay organized and make sure you find the best tenants.
Not only does a screening tool help to evaluate tenants, but it can also keep your applications organized. Try a tool like https://rentsafe.lease/ to see if it is the right fit for you. You may end up saving a lot of time and money in the process.
You can also use a screening tool to check tenants’ credit and criminal history. Rather than having to go on different websites and save documents, it is much easier to have all of the information you need in one place. This makes it easier to compare potential tenants as well.
Discuss Co-Signing for More Security
You do not necessarily need to reject a tenant because of credit history or age. If they are a good fit in other categories, ask about co-signing. This will provide both parties with more security.
Many young people have parents or relatives help out by co-signing on a lease. This means that if they default on their rent payments, the responsibility will fall on the co-signer.
The co-signer usually has to have good credit and financial history to be able to co-sign on the lease. Your uncollected rent will not have to go to collections; rather, you will need to contact the co-signer about paying it.
Do an Introductory Phone Call
Before you meet tenants in person, you can learn a lot about them through a phone call. Once you narrow down initial replies to your listing, ask applicants if they would be willing to participate in a phone call with you first.
You can go over what they want in a place and how they think they are a good tenant. You can also ask them if they have any questions for you as a landlord.
Contact Their Previous Landlords
When you screen tenants, make sure to contact past landlords if they have rented before. Similar to employer references, their history with rentals can give you a clear picture of how they will be as a tenant.
For instance, if a former landlord tells you that they ruined the property, didn’t pay rent on time, or broke tenant policies, then you probably want to pass on that candidate.
Ask About Pets
Even if you have a strict no-pet policy, you still need to ask tenants if they have pets or plan to get them. There may be exceptions to this rule, such as a rodent or a fish that will not cause damage to your unit.
Some tenants also have disabilities and emotional support animals. In this case, make sure to ask for verification of the support animal so that you can allow them to stay in your unit.
Most states have laws that do not allow landlords to discriminate against tenants with animals for their needs. You could be subject to legal action if you deny a tenant because they have a documented support animal.
Talk About Lease Length Options
After the background check and interview, you should make sure you discuss the lease with your potential tenants. If they are a good tenant, you may be willing to compromise on the type of lease that you want them to sign.
You can also offer an incentive for them to stay longer with a flat rate for multiple years. For example, if they sign a three-year lease, they will not have to worry about you raising the rent.
Although a longer lease means that you will not make as much money, it can save you the hassle of finding new tenants. If you have a good tenant, then it may be worth it to keep them in the unit for longer.
Make Monetary Requirements Clear
Always make sure to establish the tenant’s monetary responsibility before you enter any lease agreement. You should emphasize how much the rent is in your listing, and provide an estimate of monthly bills and whether or not they are included.
If you have around the same amount for bills every month, it may be easier to charge them a higher rent price with utilities included. However, some people like to take advantage of this policy and run up higher electricity costs because they do not have to pay the extra.
If you allow pets, decide if you want to charge pet rent or a pet deposit. Add it to the monthly cost breakdown before they sign the lease or any other contract.
Look at the Whole Tenant
Finally, there is no one-size-fits-all process to screen tenants. It may come down to your personal decision of whether you want to let someone rent out your unit.
When looking at your tenant screening checklist, make sure to evaluate the tenant as a whole. You should not completely discount them because of one factor. Rather, take all aspects of tenant screening into account.
Utilize Tenant Screening Today
When you look for new tenants, you should not have to worry about finding responsible people to rent your properties. With this guide to tenant screening, you can rest easy knowing that you have good tenants.
Want to learn more about ways that you can keep your property safe and profitable? Check out our site for answers to all of your questions.
