7 Steps to Checking a Prospective Tenant's Rental History

Key Takeaways:

• Tenant Screening is crucial for landlords seeking responsible tenants.
• Steps include obtaining consent, verifying identity, checking credit, employment, and rental history, conducting criminal background checks, and reviewing references.
• A well-structured tenant screening process helps reduce risks of late payments, evictions, and property damage.

Step 1: Obtain Consent from the Prospective Tenant

The tenant screening process begins with obtaining written consent from the prospective tenant. This is essential for conducting background checks, verifying income, and reviewing credit history.

Why is this important?

• Legal Compliance: Federal and state laws, such as the Fair Credit Reporting Act (FCRA), require landlords to secure consent before running credit or background checks.
• Transparency: It builds trust between the landlord and the tenant, ensuring both parties understand the process.

To formalize this, ensure your rental application includes a consent form that clearly outlines the types of checks you will be conducting.

Step 2: Verify the Prospective Tenant’s Identity

Verifying a tenant’s identity ensures that the person applying for your property is who they claim to be. This step helps eliminate the risk of fraud and provides peace of mind.

How to verify identity:

• Government-Issued IDs: Request valid IDs such as a driver’s license or passport.
• Cross-check with Provided Information: Ensure the identification matches the details given in the rental application, such as name, address, and employment history.

By confirming a tenant’s identity, landlords can make informed decisions and reduce the risks of renting to individuals with falsified or incomplete information.

Step 3: Review Rental History

A prospective tenant’s rental history provides valuable insights into their behavior as a renter. It’s essential to verify whether the tenant has had issues such as evictions or legal disputes with previous landlords.

Key things to check:

• Previous Landlords: Contact the tenant’s former landlords and ask about their experiences.
• Evictions: Verify whether the tenant has a history of evictions or unpaid rent.
• Lease Compliance: Determine if the tenant adhered to the terms of their previous lease, including maintaining the property and following community rules.

A strong rental history indicates the tenant’s reliability, while a problematic history could raise red flags.

Step 4: Conduct a Credit Check

A tenant’s credit report offers a window into their financial responsibility. It helps landlords assess the tenant’s ability to meet rent payments on time.

What to look for:

• Credit Score: A higher score suggests the tenant is likely to make rent payments reliably.
• Payment History: Check for any history of late payments or outstanding debts.
• Current Debts: A tenant burdened with high debt may struggle to keep up with rent.

A credit check can reveal financial stability and help landlords determine if the tenant is a low-risk applicant.

Step 5: Verify Employment and Income

Verifying a tenant’s employment and income is crucial to ensure they have the financial capacity to meet rental obligations.

Steps to verify:

• Contact Current Employer: Confirm the tenant’s employment status, salary, and job stability.
• Income Documentation: Request pay stubs, tax returns, or bank statements to verify income. Ideally, tenants should earn at least three times the monthly rent.

Consistent income ensures that tenants can pay rent on time and meet other financial obligations associated with renting a property.

Step 6: Conduct a Criminal Background Check

The safety and security of your rental property and other tenants are paramount. A criminal background check helps ensure that the tenant does not have a history that could pose risks.

Important considerations:

• Criminal Records: Check national and local databases for criminal activity, including violent crimes, drug-related offenses, or property damage.
• Sex Offender Registries: In some cases, checking for listings on the sex offender registry may be necessary depending on local laws and the property’s location.

It’s important to note that you should always follow the laws in your jurisdiction regarding the use of criminal background information when screening tenants.

Step 7: Review References and Conduct a Personal Interview

Finally, reviewing references and conducting a personal interview adds a more personal dimension to the tenant screening process. This step allows you to get a sense of the tenant’s character, communication skills, and overall reliability.

Best practices for this step:

• Previous Landlords: Ask former landlords about the tenant’s behavior, timeliness in payments, and adherence to property rules.
• Personal Interview: Use the interview to gauge the tenant’s attitude, clarity in communication, and expectations for the lease agreement.

This step offers valuable insights beyond what a rental application or credit report can provide and helps you feel more confident in your decision.

How SmartScreen Can Help with Tenant Screening

SmartScreen is an advanced tenant screening platform designed to simplify the screening process for landlords. Using data from SmartMove, it provides comprehensive reports, including credit checks, eviction history, and criminal background checks.

Key features include:

• Instant Access to Reports: Get fast, reliable background checks, credit reports, and criminal history data.
• Ease of Use: SmartScreen’s user-friendly interface allows landlords to quickly analyze tenant information and make informed decisions.
• Accurate and Current Data: With up-to-date records, landlords can trust they are getting the most accurate information available.

SmartScreen offers a streamlined process that reduces the risk of problematic tenancies and protects your investment.

Final Thoughts on Tenant Screening

Tenant screening is an essential part of finding reliable tenants and safeguarding your property. By following these seven steps—obtaining consent, verifying identity, checking credit, verifying employment, reviewing rental history, conducting criminal background checks, and checking references—you can significantly reduce the risks associated with renting.

Implementing a thorough tenant screening process ensures that you select tenants who are responsible, financially stable, and respectful of your property.