“How To Answer ‘How To Check My Credit'” written by Mike Marko
Have you ever been asked by someone “how to check my credit”?
As a property manager, it’s your responsibility to lease your property to a responsible tenant. You have to know if you’re negotiating a lease contract with the right person.
You can do that by performing a credit check. A tenant credit check can help you figure out if an individual is qualified to rent a certain property.
But sometimes a potential tenant may ask you, “How to check my credit?” If this happens, you need to provide the applicant with the right guidelines on doing a credit check.
In this article, we’ll talk about how you can answer “how to check my credit” when asked by potential tenants.
Guidelines on How to Check my Credit
Having the proper guidelines in answering how to check my credit questions is important, especially if you’re a property manager. You have to be able to explain to a potential tenant the process that you use to ensure they’re qualified to lease the property.
An important part of the guidelines includes a tenant background screening system. The system helps you figure out which applicants are good bets for your leasing business.
One way of figuring that out is to look at their financial history, which is easily evaluated with credit checks.
So, what is the importance of checking credit?
Importance of Checking Credit
As I said earlier, knowing how to answer “how to check my credit” is vital for your leasing process. Checking an applicant’s credit can help you decide whether or not the applicant’s a great fit for your leasing business.
That’s because answering the question of “how to check my credit” (on the applicant’s side, anyway) shows you how the applicant manages his finances. As a property manager, you could use his credit history to detect future financial issues.
If an applicant seems to have a lot of problems with credit, he’s probably not a good tenant. That’s because he might have trouble paying the rent on time or in full.
It’s not always a fool-proof prediction of how he’ll act as a tenant, of course. But the credit report is still a good indicator of what you can expect from a possible tenant. That’s why it’s important for you to know the answer to “how to check my credit”.
Now, let’s check the 5 indicators on how to answer “how to check my credit”.
5 Indicators on How to Check my Credit
If you want to explain to a tenant the answer to “how to check my credit”, tell them you look at these five indicators.
The first indicator is the payment habits of the tenant. The payment habits are best observed on their billing statement in selected stores and banks.
Second is the tenant’s rental history. This reveals any past evictions and financial judgments against the applicant. You may also contact a past landlord of theirs to get information about their rental history.
A third indicator to look for is the debt load of the tenant. This is one of the most important indicators that you should look for. The statement will help determine the ability of the potential tenant to pay rental fees.
The fourth indicator is the record of accounts paid on time by the applicant.
Obviously, you want to have a tenant who will pay you on time. The record will show the applicant’s capability to pay on or before the due date. This will help you decide whether or not the potential tenant is a great fit.
The final indicator is the applicant’s bankruptcy status. You have to make sure that the applicant doesn’t have outstanding bankruptcy filings.
How Is Rental Credit Check Performed?
When potential tenants ask “how to check my credit”, they usually think you can just check it for them at the drop of a hat. That’s not true, though. There are permissions and rules to it.
A property manager has to do a few things before he can start the rental credit checking procedure.
You first need to get a signed authorization to proceed with the process, for example. Otherwise, you can get in trouble just over the simple question of “how to check my credit”. Checking credit for a potential tenant needs to be a law-abiding activity.
Want to know what else to do when answering the question of “how to check my credit” for a tenant? Follow the process outlined below.
You need all applicants to complete an application form to complete the credit check process. The property manager will gather information through the form. Once the form is done, the property manager may proceed with the tenant background check.
The application will contain the applying tenant’s following information:
- Full name,
- Home address (for past 2 years),
- Social Security Number,
- Employer, and
A signed consent form is also needed, stating the agreement of the potential tenant to have the credit check done.
As a property manager, you need to prove your eligibility as a certified property manager. This procedure might take two to ten days to complete.
You may need to provide some information as required by the company, which may include:
- Your current address (billing proof),
- Valid ID (passport or driver’s license), and
- Proof of ownership of the said rental property.
There are some property managers who charge applicants a fee for the background credit check process. This serves as a financial safety net for some property managers in case a potential tenant doesn’t meet the qualifications.
Other property managers don’t charge a processing fee for fear of driving the potential tenant away. They will shoulder all expenses from applying for authorization down to the final step in signing the lease.
Take note that when property managers do charge a fee, the fees are usually deductible from the tenant’s rent once settled. That way, there won’t be quibbles over who should pay when tenants ask “how to check my credit”.
Checking the Credit
You may choose which agency to contact for the credit check. Make sure that you use a reliable agency to run the process.
The main credit reporting agencies are Experian, Equifax, and TransUnion. Normally, when people ask “how to check my credit”, the answer is through them. They have a credit report that you can purchase.
The process time might vary from seconds to a few days. This will depend on the agency. You can regularly check the progress of your credit report request, however.
Credit Check Analysis
Once you have the credit check results, it’s time to analyze them. Compare them to their credit, past tenancy, and other issues that would help you determine if they are a good fit for the property.
Don’t forget to go over and review the credit report with the applicant. This helps them understand and resolve any past credit or financial problems.
Final Thoughts on How to Check my Credit
In this blog post, we talked about how to answer “how to check my credit”. Background credit checks will help you decide whether or not an applicant is a good fit for your property.
You also need to establish a tenant background screening system that factors in all aspects of a past tenant’s financial capabilities.
We also mentioned the 5 indicators on how to answer “how to check my credit”. This includes the payment habits of the tenant and their rental history. Other indicators are the debt load and the accounts paid on time. The last and very important indicator is the checking of the bankruptcy status.
If you have further concerns relating to how to check my credit, then leave a comment below.
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