Whether you’re a property management company or a private landlord, choosing the wrong tenant can come with a price. What are your top concerns when screening tenant applications? Excluding our national criminal database and sex offender registry searches, we analyzed five of the most important warning signs to watch for on tenant applications to help you make the right tenant choices.
Whether someone claims they don’t have access to their pay stubs or are just unwilling to release the information, not verifying income raises suspicion. As a landlord or property manager, you need the security of knowing that your tenants receive consistent income in order to pay their bills.
Credit History & Debt
If tenant applicants consistently make late payments on their credit card bills or rental related collections, then who’s to say they won’t do the same for monthly rent? Along with this, if they have a significant amount of debt that is far beyond their income rate, it may indicate irresponsible money practices. Be wary of signs like this, and if nothing else, ask your applicants directly.
Each landlord generally sets their own baseline rent-to-income ratio qualifications. After all, there’s more to living than just paying rent. Can your tenants easily pay for basic needs like food, utilities, and transportation in addition to the cost of rent? If your applicant barely makes the cut, it might be a good idea to direct them towards lower income housing.
Gaps in Rental History
Your tenant applicant has a 4-month period here and a 7-month period there where there’s no rental history. Although there might be a reasonable explanation and this isn’t necessarily a deal breaker, you may want to take a further look into your applicant’s background.
If an applicant has never lived in a building for more than 6 months at a time, this could raise some red flags. Regularly breaking lease agreements and jumping from place to place indicates a lot of inconsistency. Make sure you’re reaching out to past landlords to verify the rental and payment history of a tenant.
Are your tenant screening needs being met? Read more about the services Alliance 2020 offers and how we can help you here.
- On November 19, 2019