Landlords who want to protect their investment and attract long-term tenants must screen each applicant who comes through. Otherwise, you run the risk of your tenant missing rent payments, disappearing before the money can be collected, damaging your property, or worse.
To make sure you have the ideal tenants living in your property, or at least some trustworthy ones, here are a few key reasons why a tenant screening report is absolutely essential to your operations.
A safer community
While in the past, tenant screening involved lots of troublesome paperwork, you can now look for an online tenant screening report free of charge to help you get the job done without a lot of money or hassle. These reports check a potential tenant’s credit history, rental history, employment verification, criminal background, and other potential issues to ensure you’re getting a good tenant.
When your property is located in a nicer community, you want to ensure a certain level of safety for your tenants. Additionally, you want a good reputation for your rental community that attracts good tenants when you have vacancies. A key component of a tenant screening process is a criminal background check. This check looks for any kind of criminal activity so you know whether or not you should deny their application.
It might surprise you to learn that 22 percent of tenant screening reports have a positive hit for criminal history. Once you’ve been notified of criminal history, it’s okay to do a little more digging. If everything else about your tenant checks out, it’s possible that the criminal report was from a long time ago, and they’ll be a responsible and safe tenant.
For example, you might find that one tenant had a problem with abusing substances, but has since received drug and alcohol treatment and is a reformed citizen. If your research shows that this person really has changed, there’s no reason to deny their application.
Less liability
Liability risks should be a constant thought for landlords. Something as simple as forgetting to put a yard rake away after performing landscaping maintenance on your property could lead to being sued for a trip and fall accident.
While landlords must do their due diligence to keep their property safe and free from potential risks, they should also consider the liability that their tenant brings to the table. Certain tenants are much more likely to cause problems than others, and you may be liable for the resulting problems. Additionally, there are fraudsters who will try to scam you out of your money. They might intentionally cause a problem and blame it on you so that they can sue for compensation.
On-time payments
When you’re in the rental property business, you can’t stress enough the importance of tenants who make their payments on time, every time. Those who fail to do so cause a lot of stress and require a lot of time to correct the problem.
About 84 percent of the problems that landlords have are the result of payment problems, many of which end up in court. Many tenants fail to make on-time payments, and some will go several months without paying the rent and disappear before they make any payments at all, leaving damages and several thousands of lost dollars behind them.
Tenant screening reports show references and past places of residence, so you can gain information about their bad rental history. Previous landlords will share their problems with these tenants before you approve their application, so you can avoid issues.
If you haven’t found a good tenant screening tool yet, now is the time to do so. It’s the best way to truly protect your investment and your other renters to ensure a good experience for all involved.
