“Learn More About Tenant Background Search” written by Mike Marko
Do you know how you can do a successful tenant background search?
Quite often, a property manager conducts a tenant background search on their own. and it’s more likely when they are just starting out in the rental property business.
A bad tenant can cause a lot of waste of time and money, and stress. A tenant background search can help you avoid tenants if done properly.
That’s why in this article, I will give you some tips for conducting a successful tenant background search.
Tips For Conducting A Tenant Background Search
A successful tenant background search will help you avoid bad tenants from renting your property. It will also help you find the most qualified renters for your properties. Since a background check is so important, it’s best to use a reputable company to conduct the background check report. If you are planning to do background checks on your own, it is best to have a tried and true method of doing a background check in your property management company to find the best tenants.
When doing a tenant background check you need to understand the requirements and authorizations needed to do a tenant background check correctly.
The tips below will help in any background check to eliminate bad tenants and find the most qualified tenants to rent your properties.
Ask Useful Questions
When meeting new tenants applying for a rental property you should always be collecting information and data to distinguish applicants from each other. Getting to know all the different applicants and understanding why they are wanting to rent from you helps you make the final decisions on who you will rent the property to.
Whenever you’re talking to a possible tenant, it’s important to ask questions that can help you somehow verify their identity and learn more about how they behave when renting a property. When tenants fill out an application for rent everything on that form should be questioned and verified. The applicant’s answers will help you in conducting a background search. This is also useful in determining if they are eligible to be your tenant.
Here are some questions to get from applicants that might help you:
- When do you need to rent the property?
- Who else will be living with you?
- Does your present landlord know that you’re moving?
- What is your job? How long is your contract?
- Does your job pay you well? How much do you earn on a monthly basis?
- How’s your credit report? Is there any reasons or disclosures you want to make prior to submitting for a credit report check?
- How much can you afford for monthly rent?
- Do you have a healthy budget?
- Do you have pets?
- Do you smoke?
- Do you do illegal drugs?
- Who else will be living with you?
- What may prevent you from paying the rent on time?
Most of the questions above will help you eliminate applicants for rent depending on the answers provided, especially if you have a strict policy to rent your property.
The Interview Process Is Very Important
When you’re talking with the possible tenant always remember you are interviewing them and trying to get to know and understand how they would act if you were to rent them a property. It is important to let them talk about themselves and try to pick up or remember the things that might be important. Keep a notepad available and take notes so that you can write down key things they disclose and things that need to be verified with 3rd party sources.
Often during the background screening process, you will find discrepancies and misinformation or incomplete information from tenants so it is important to verify questions and answers given in the interview against their rental application. Be curious as much as possible, ask them how is their relationship with their previous and current landlords. Any information you get from the tenant will help you in conducting your background check efficiently and with success.
Be Cautious and Verify All Information
Throughout the rental application process and subsequent background checks and credit checks, it is important to be complete and cautious when verifying information from tenants. We suggest that your very cautious when it comes to your potential tenant’s rental history. Find out through the background check or tenant interviews if the tenant has had rough relationships with past rentals. Rental history can help you predict how they will behave in your property.
Verifying all information given to you by applying tenants against 3rd party sources is vital in identifying fraud and other misrepresentations that may occur.
As the property manager, don’t just rely heavily on the information and documents that are provided by the possible tenant. Most documents can be easily faked and that’s one of the main reason why many property managers conduct a tenant background search. It helps them verify the information given by the prospective tenant.
Get To Know The Tenant’s Relationships With Past Landlords
It is important to know who the tenant’s past landlord and to be able to verify this information with a 3rd party source. If the tenant has a bad rental history this is the most common place for them to attempt to have a friend fraudulently act as a past landlord to misrepresent that they were a good tenant in the past. If you ever identity fraud like this then it is best to deny rental and report the fraud to authorities as the applying tenant could be a criminal or perpetrating identity theft.
Knowing the applicant’s relationship with their past or current landlord is another way to tell if they are a good tenant or not. When speaking on the phone or in face to face interviews with the applying tenant it is best to ask the applicant about how good or bad is their relationship with their past and current landlords. Let them talk about their experiences and write down what seems to be important. You can easily verify the information when you are speaking with the past tenant’s landlord or property manager. Knowing a tenant’s relationship with their past landlords will give you an idea if the tenant could be someone you’ll be comfortable with or trust.
Be Cautious Of Any Suspicious Signs
The rental application and the background checking process is the best way to find out about who will be renting your property. You never want to rent to a criminal or someone who lies on their application you should always be suspicious and verify all information that the applicant gives you prior to renting them a property. Since you already started asking about their past experiences, it’s advisable to keep the applicant talking and look for any suspicious signs. Be a wise property manager and always observe the following red flags when someone is applying for a property:
- If a tenant is eager to move in right away. This is a red flag as the tenant could be breaking a lease or trying to avoid eviction from a past rental. Normally a good tenant will need 30 days to move and they normally begin his/her search for a rental property at least 2 months before they need to move in.
- If the tenant looks too good to be true. Make sure you do your due diligence and run all the necessary reports and background checks to verify the applicant is as perfect as they represent to you. You’ll never know what’s the real story until you run all the proper background checks and reports to verify the facts about the tenant.
After receiving the tenant’s rental application form, confirm their identity right away and verify the facts that they provided. This is most easily done with using an outside 3rd party ID verification company. Most internet background check companies offer this service included with other background check services…
Confirm The Tenant’ Identity
Identity theft and illegally using someone else’s identity to rent properties has become a major problem when renting units. There are many ways you can verify the tenant’s identity. Since you already have the basic information about the tenant, you can check the information they have given you on the internet.
After receiving the tenant’s rental application form, confirm their identity right away and verify the facts that they provided. This is most easily done with using an outside 3rd party ID verification company. Most internet background check companies offer ID verification services included with other background check services.
Use Social Media As a Tool
You can also do a lot of ID verification on your own using the internet and public services and social media. Almost everyone has an account on any social media and by simply typing the possible tenant’s name in the search box and dozens of people with the same name will appear on the results. Matching a picture or getting the actual social media to account from the applicant is the easiest way to find the right account to evaluate.
Most of the social media profile contains almost every information about a person. Reviewing their posts could reveal that this is a person you might not want to rent to. Don’t stop if the information that is provided by the tenant matches the information on their social media profiles. Aside from the basic information of the tenant, you can also contact their landlord or employer to check their rental and work history.
Use 3rd Party Sources to Verify Tenant Provided Information
It is highly suggested to never use the applicants provided contact information for their past landlords or employers. Anyone can pretend that they are the tenant’s landlord or employer. So instead of using the provided contact information, it is advisable to look also for the tenant’s past or current landlords and employers contact numbers on the internet. Using a reputable background check or screening company can also help you verify this information.
Once you have contact with the tenant’s landlords and employers, you can ask questions about the tenant’s behavior, work and living habits and other personal information you might feel are important in qualifying them for rental of your property. Never hesitate to ask how the tenant pays the monthly rent or how they took care of the property or left it when vacating the rental.
However, be aware that some past landlords are giving good feedbacks or references to get rid of the bad tenants on their property.
Look For More Useful Information Through Multiple Reports
One type of tenant screening process is using a company that does tenant background searches for verifying the possible tenant’s identity as well as being used it to check the tenant’s criminal records and employment history.
A credit check and report were done by one or all of the 3 major credit bureaus Equifax, Experian, and Transunion, is helpful in determining the financial history and predicting rental payments in the future. As the property manager, you can ask your tenant to sign an agreement that allows you to check their background. If part of the background check process includes a credit check then you must get a sign authorization to do credit screening services and reports.
Another report to consider when doing background checks is choosing a company that specializes in tenant screening services. The tenant screening service is designed to let property managers have an insight into the applicant’s behavior in renting the property and paying monthly rent. Various useful information about the applicant will be given through a report and it can help you determine if they are an eligible tenant for your property.
Most agencies and companies that are offering tenant screening services are can be found on the internet. Tenant screening services cover the rental history, work history, criminal records, and credit check of the tenant. However, you can’t just use any websites on the internet when conducting a background search. According to Fair Credit Reporting Act, every property manager is required to use Consumer Reporting Agencies. CRA has set standards for data protection and dispute resolution.
The background checking process and using all different types of reports available allows you to best verify and sort applicants to find the most qualified and best renters for your property. Combining all information and verifying it against all reports available will help you in determining whether the applicant is eligible to be your tenant or not.
Remember, you’re conducting a background search to avoid the problems of having bad tenants in your property. As the property manager, you have the right to conduct the necessary background and credit check on every possible tenant.
Final Thoughts About Tenant Background Search
By conducting a property tenant background search you can improve your chances of renting to good tenants that will both pay the rent and help maintain the rental. A background search will also avoid the risk of having bad tenants inside your property: tenants that can cause stress and considerable money.
Use the tips we discussed in this article to help ensure the best tenants for your rental properties.
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