If you are a landlord or property manager, you need to ensure every tenant who signs a lease is reliable and will not cause issues. Even if you need to fill spaces quickly, you should never rent out space to just anyone without properly vetting them. Here are six things landlords should look for when screening potential multifamily tenants.
Take the Comments of Previous Landlords Seriously
A previous landlord can tell you everything you need to know. Here are a few questions to ask the previous landlords of a potential tenant:
· Would you recommend this tenant without reservation?
· Has the tenant ever had any issues with any neighbors?
· How long were they a tenant?
· Did you return the tenants full security deposit or did you need to hold funds for repairs?
The answers to these questions should weigh heavily on your decision to sign a tenant. Keep in mind that sometimes bad tenants don’t have marks on their credit scores or have never been evicted.
Hold an In-Person Interview
A credit score alone is not the sole indicator of a quality tenant. Many people can be jobless and have a perfect credit score, so it is crucial that you meet with potential tenants in person. Call on their references and pay attention to the tone of the references and ask directly if the person is a good tenant who meets their obligations.
Have a Solid Lease
The best thing you can do as a landlord is to have a bulletproof lease agreement that offers no loopholes for the tenant. Feel free to constantly tweak the lease as your needs change as a landlord or property manager. Ask a more seasoned and veteran company to see a copy of their lease to tweak to your liking and business model. Having a good lawyer on your team will also help ease any friction and answer any questions.
Screen All Tenants
When you have co-applicants interested in a space, it can be tempting to only screen one, but you should screen all applicants. Every renter has a different past, a different credit score, background history, etc. You need to get a full picture and screen every person applying to ensure all tenants are of quality.
Review Compliance to Housing Laws
Intelligent landlords will review compliance to Fair Housing Laws in combination with local and state regulations. An important component of screening is maintaining a consistent process for everyone. Having written guidelines and scorecards will allow for more transparency and stricter guidelines. Having documentation in the event of an issue from a tenant or an audit can help save you from paying unnecessary fines.
Utilize Third-Party Services A third-party company will pull credit scores, evictions, and background checks, and call the previous landlord to see if a tenant should qualify. You can do all of this on your own, but having a professional third-party company take care of it can reduce liability and give you a more consistent process.