Tenant screening is one of the most important steps in rental property management, although it’s quite easy to make mistakes that could set off financially wasteful problems afterward. Whether it’s letting personal biases influence decisions or skipping essential parts of the background check, neglecting key steps in the screening process can prompt major issues such as late payments, property damage, high turnover, and even legal complications.
The good thing is that avoiding these mistakes can help you attract high-quality tenants and keep your properties running smoothly. Here are some of the most common tenant screening mistakes and different practical tips on how to steer clear of them.
Mistake #1: Failing to Screen Consistently
Consistency is the vital key to effective tenant screening. A major part of consistency is warranting that you are sticking to the same criteria for every applicant rather than letting emotions or personal biases influence your decisions. There are different risks of failing to screen consistently and objectively, which include missed opportunities for a great tenant and even potential discrimination lawsuits.
Legal action is both tediously time-consuming and very expensive and a consequence all rental property owners should work actively to avoid. Multiple state and federal laws prohibit discrimination in housing, and it is essential to understand how those laws apply to you and to keep your screening process in compliance.
Mistake #2: Not Checking the Right References
Another top mistake during screening is failing to check the right references. As part of the application process, you should ask prospective tenants for personal and professional references besides previous landlords. Employment history, financial references, and personal character references are all appropriate types of references to certainly ask for. And then, make certain to truly contact all of these references and ask the right questions.
As an example, you could ask them how long they’ve known the applicant, their job performance, how well they care for their current living space, and any red flags they observed. Contingent on the type of reference, you should suit your list of questions appropriately.
Mistake #3: Overlooking Credit and Background Checks
A third big mistake in tenant screening is failing to run credit and background checks on the applicant. Both assessments are typically standard in rental markets nationwide, but still, most property owners and managers miss this opportunity to learn valuable information about their renters.
Credit and background checks tell a clear story about a person and can help you identify possible red flags, as for instance prior evictions, criminal history, or financial difficulties. While not every negative item on a credit report or a background check is an automatic cause for refusal of an application, these checks do bestow you what you need to make an informed decision about your next tenant.
Mistake #4: Ignoring Rental History
Probably the greatest mistake a rental property manager can make is not verifying the rental history for an applicant. Rental history is essential to investigate for the reason that it can give you deeper knowledge and insight into a renter’s likely future behavior.
When investigating rental history, make certain to watch for potential red flags, particularly late payments, property damage, and other lease agreement violations. While your entire decision should not be according to a previous landlord’s report of a person, above all if there were disagreements during the rental period, it can give rewarding insight into how the applicant will behave as a renter.
Mistake #5: Inadequate Communication with Applicants
One final matter, a last mistake rental property owners and managers make during the screening process is failing to communicate clearly and consistently with the applicant. Applying for a rental home can be a stressful experience for a renter, and frustration can clearly and easily turn into bad feelings. Take into account that your renter’s experience actually starts with the first interaction with you and will continue throughout your association, no matter how long that may be.
To foster a positive relationship with your tenant, begin successfully with transparency on your application requirements, timelines, and how your decision will be communicated. Along these lines, you can avoid misunderstandings that could frustrate or daunt applicants and result in negative reviews.
Get Your Screening Process Right!
By observing these tips and strategies, you can effortlessly avoid the top mistakes rental property owners and managers make during the screening process. This, in turn, can bring about better tenant retention, fewer nuisances, and even boost your reputation as a landlord.
