“Checking A Tenant’s Rental History” written by Mike Marko
Do you know how to check a rental history report so you can better tell an applicant will be a good renter or not?
As a property manager, you need to require every tenant to undergo a series of background checks. This will help ensure you that you’ll only choose good tenants for your property.
That’s why I’m going to talk to you about a tenant’s rental history, and what you should look for when screening tenants for your rental properties.
What Can You Find In A Tenant’s Rental History Report
A tenant’s rental history can give you enough information that can help you decide if an applicant is eligible to be a tenant in your property. Rental history can include evictions, court proceedings, late rent payments, and other legal actions regarding the tenant or it could not show any of these.
Before we go deep on how rental history can affect the rental application, let’s find out what is rental history first.
What Is Rental History?
Rental history is a detailed file of information on the tenant’s past rental arrangements. It contains information such as…
- previous addresses
- late rental payments
- court actions regarding the rental
- losses or judgments against the tenant regarding unpaid rents
Additionally, you can also require as part of rental history the following reports:
- credit score
- credit history
- criminal history
- other data that will help you qualify them if they are a good or a bad tenant
Having this information will help you determine if the applicant is eligible to be a tenant in your property.
A rental history process can serve as an investigation on the applicant to know if they are truthful on their rental application and during your meetups and other contacts.
How To Check A Tenant’s Rental History
There are numerous ways of checking rental history for applicants but with each way, there is a specific requirement needed to get complete and accurate information on the applicants. When completed correctly the applicant’s rental history report can give you a lot of useful information about how they pay their bills and how they behave inside the rented property.
To check your applicant’s rental history follow these simple steps:
1. Ask potential tenants to fill out your rental application form
Make sure that it follows the required format in your area. The applicant must submit and sign the rental application allowing you to conduct a background check for rental of the property. If you are requiring credit checks it is legally required in most states to have the applicant sign an additional form allowing you to do the credit check for rental purposes.
2. Complete written concent
After submitting the rental application form, ask the prospective tenant to sign a written consent that allows you to conduct all of the necessary background and credit checks on them.
3. Check the applicant’s references and verify their information
It is advisable to contact the applicant’s previous landlords that are provided in the rental application. Verify if they were the ones who truly managed the property written by the tenant in the form. Also, ask information about the applicant’s behaviors in renting and paying dues.
Use internet or background check companies to get these reference phone numbers to avoid any fraud or misinformation that the tenant could provide on the rental application.
4. Check with previous landlords
Call the applicant’s current landlord and ask the same questions that were asked to the previous landlords. Once the applicant’s identity is verified, ask various questions that can help you evaluate the applicant.
Ask questions about the applicant’s behavior in the rented property and how they pay their bills. Again use social media and background check companies to confirm that the person you are talking with is a property manager or landlord and that they were the ones who rented to the applicant in the past.
5. Background check services
Call or contact your preferred agencies or companies that will conduct the background check on the prospective tenant. Just give the applicant’s verifying information and ask for the important information such as any domestic issues or police activity at previous rental homes.
Most background checks require payment so you can pass this cost back to the applicant by charging them an application fee. Check your local and State laws to determine the legality of charging and accepting a fee for rentals.
6. Check public records
Once you got the report, check their public records and look if they have evictions. Eviction is a huge red flag. If they have bad information from past rentals you should always ask the applicant for a meeting and have a personal interview with them.
Ask them why they got evicted and ask if they are taking actions to fix their mistakes. However, most property management firms will immediately disqualify a tenant for rental if they have past evictions on their rental history. It is your responsibility as a property manager to determine your company policy regarding evictions to avoid any legal challenges from denied applicants.
What Can You Find In A Rental History Report
A rental history comprises detailed information from the tenant’s past rental records. This information will give you useful details from their previous property managers.
A rental history may contain the following information:
- Bad Credit Scores
- Bounced checks
- Late rental payments
- Court actions against the tenant regarding past rentals
- Breach of lease terms
- Public records of complaints about them
- Detailed reports of damage to past apartments
- Eviction proceedings
Like credit reports, rental history will also include how the applicant made their payments.
This information is helpful for property managers who are strict in late payment policies.
What To Do If The Rental History Contains Many Negative Information
Prior to renting any properties, your property management firm should have a complete list or policy of what can or will disqualify someone from the rental of your property.
By developing and following strict rules and requirements that you set for rental of your properties helps to protect you from any legal challenges when not renting to an applicant. You should inform the applicant to your requirements to rent prior to conducting your background check to protect yourself if you find negative items that result in you not renting the unit to them. If the applicant has a lot of negative information or red flags on their rental history report you have to decide carefully if you will allow them to be on your property.
When a tenant has a lot of negative details on their rental history reports then you have to analyze how each of the negative items could affect future rental of your property. Always remember the saying “History repeats itself” and this is commonly the approach you need to take to disqualify them from a rental of the property than to take a risk that their past negative behaviors will change.
Some negative items like an occasional late credit card payment or a late loan payment can be disregarded if the applicant is able to explain the reasons why those things or events happened. If negative items come from past landlords or from their previous property managers it is best to get their side of the story prior to coming to a final conclusion or opinion on the information. Often times there may be a different story so you should also hear it from them prior to making a decision on their application.
Negative items like late rental payments or even missed payments, and evictions are totally a bad impression to every property manager and everything will reflect on their rental history reports. Commonly these types of negative reports would disqualify the renter from rent your property.
Some property managers would appreciate these tenants if they would tell the truth and the story behind what happened. Even when confronted with negative information from the rental reports it is still best to interview the applicants and let them explain their side of the story prior to making any final conclusion regarding their application and ability to rent your property.
Final Thoughts For Checking Your Rental History
As we discussed, you should require every rental candidate have their rental history reviewed. The rental history can give you a lot of useful information that will help you determine if the applicant is a good tenant or not. Follow the tips in this article and weigh the information that is presented in the report against other applicants. Then make the best selection best for you, your tenant, and your business.
Feel free to comment below with any thoughts or questions you may have about rental history.
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