Finding good tenants is the most critical part of being a landlord, and weeding out potential rule breakers and delinquent rent payers all starts with a systematic tenant screening process.
How to Find Responsible Renters
According to Every Landlord’s Legal Guide, by Marcia Stewart, Ralph Warner and Janet Portman, owners should do the following:
- Call current and previous landlords
- Verify income and employment
- Run a credit check on all adults who would be living in the home.
A more complete process includes:
- Review court records
- Verify bank accounts
- Check the sex offender registry
Owners should use the same screening process for all applicants to avoid potential discrimination charges, the Guide said. Federal Fair Housing laws strictly prohibit discrimination based on race, color, gender, national origin, religion, family status or disability. States and localities often have more stringent rules – D.C., Arlington County, and Alexandria all prohibit discrimination based on additional reasons, such as sexual orientation.
Recent landlords will offer the clearest picture of whether the applicant paid rent on time was a quiet, rule-abiding tenant who left the home in good shape. Tenantscreeningblog.com recommends talking with at least one prior landlord in addition to the current landlord, who could gloss over problems to get rid of a problem tenant.
Owners should contact applicants’ current employers to verify they have a stable job and can afford the rent. Experts usually recommend a salary at least three times the cost of rent and monthly utilities.
Credit reports allow owners to verify that a prospective tenant’s identifying information matches what’s on their rental application and see whether the tenant has a history of late payments, according to Experian. A report will also show bankruptcies, collection accounts and civil judgements, possibly including any related to evictions if the prior landlord has sued or sold the debt to a collection agency.
Reports that show history of late payments or a high debt load are red flags that the applicant may have trouble paying the rent. Owners who reject applicants for those reasons, or others in credit reports, must notify them of the reasons and their right to order a free copy of the report, according to federal law.
There can be a lag before records show up on credit reports, so checking local court records can be more reliable to uncover evictions and other civil or criminal records. Tracking this information across many localities can be time consuming, especially in the transient D.C. metro area, which attracts renters from around the world.
While popular screening companies offer varying levels of services, owners may find it preferable to work with a trusted, local property management company to vet applicants thoroughly and lawfully. Professional property managers typically have years of experience screening tenants and sophisticated, efficient systems in place to perform all necessary checks.
Proper tenant screening takes time and money, but the cost of poor screening is potentially much higher. Bad tenants may fail to pay rent, cause costly damage or engage in criminal behavior on your property.
Removing problem tenants is expensive and often takes months, while problems and unpaid rent add up, especially in tenant-friendly cities like Washington, D.C. Successfully evicting tenants also requires following legal procedures and timelines to the letter, often requiring the help of an experienced attorney.