5 Things To Look For On A Rental Application
By JD Esajian on September 27, 2016
Good tenants are the key to any successful rental property. You can have everything else in place but if your tenants are poor it won’t make a difference. Most landlords understand the importance of tenant screening but aren’t sure exactly what to look for. On every rental application there are a few things that should jump right off the page. While payment history is the most obvious it is just one of a handful of important areas. Diligent tenant screening can never guarantee a good tenant but it will give you the best possible chance. Renting to the right tenant can save you months of headaches and make your life that much easier. It all starts with taking the time to find the right tenant. Here are five things you need to look for on every rental application.
- Rental Payment History. On one hand the past can often be the best predictor of the future. On the other hand there are always exceptions to the rule. The very first area you need to look at is the section that talks about rental history. Any tenant with a previous eviction should be eliminated. Unless there was an extenuating circumstance such as illness or unexpected loss of job there is no justifiable reason for an eviction. Most tenants will not come right out and say if they had previous late payments. You need to follow up with any landlords listed in their rental history. You should start with the most recent and work backwards. If they were a few days late but paid every month this could be a red flag and needs to be addressed. You need to find out when they paid, how they paid and if there were any ongoing issues throughout the lease. Always start with a tenant’s payment history and work from there.
- Employment. The backbone of payment history is steady employment. It is up to you to discover each and every source of income your tenant has. It is also not enough to know that your tenant is currently employed, you need to dig a little deeper. You should find out when they get paid and the manner in which they receive payment. You should give your applicant the heads up that you are going to call the human resources department and verify how long they have worked at their listed employer. You should find out about the likelihood of continued employment and if there have been any recent layoffs. If your tenant simply works seasonal jobs you increase the chances that receiving payment in off months could be an issue. You can certainly never predict changes in the labor market or what will happen with a company but you can do your due diligence and know everything you can about an applicant’s employment.
- Questions About Rules. Every landlord has their own set of rules. Some of these make more sense than others but they are there for a reason. You may have rules regarding smoking, pet use, parking, storage and even noise. You should find a balance between enforcing rules that are important to you and not being too overbearing. You want tenants that value the rules and don’t question everything on the lease. If they question why they can’t park in the street or why they can’t use the attic this is often an indicator of things to come. Soon enough they will question why you want the rent received by the first and if they can have their sisters dog at the house for the weekend. There can be some flexibility with the rules in certain areas but you don’t want a tenant that questions everything all the time. Not only will this become frustrating but eventually they will stop asking questions and start breaking them.
- Willingness To Move Forward. If a tenant is looking for a place to live they should be eager to move forward as quickly as possible. Most tenants have rented for several years and know how the process works. When looking for a tenant time is of the essence. You may be facing a current vacancy or have a lease that is quickly coming to an end. You don’t want tenants that drag their feet for several weeks. You don’t want to rush them through the process but you also need to keep things moving. If they need to see the property one more time they should schedule it as quickly as possible. If they have questions on the lease they should bring them to you in a day or two. They should be the ones that have a sense of urgency, not you. If you don’t feel this is the case you should consider moving on to the next interested party.
- Length Of Time At Each Address. If a tenant finds a good property it is not uncommon for them to stay there for years. This would be an ideal situation for any landlord. When looking at a tenant’s rental history look at the dates at each address. If they are constantly bouncing from address to address you need to find out the reason why. They issue can be with a tenants employment, the landlord, the property location or the price. All of these can be potential problems. Ask the application about the reason for the constant changes before committing to them.
Good tenants are truly worth their weight in gold. Always take the time and review these five areas of your tenant’s application.