New methods for finding the best tenants
The old tried-and-true methods for screening the best tenants for rental property are quickly becoming outdated these days. And since finding quality tenants is the lifeblood of your rental business, you have to be very precise and feel very confident that the methods that you’re using to screen prospective tenants are the best ones available today.
The home visit
With this in mind, the methods of running a credit and background check and calling past references (most notably, prior landlords), are all staples by today’s standards. But you’ll want to augment this with new methods. One new method that’s gaining popularity with landlords is to go and visit a prospective tenants’ current home. That’s right – you should be checking up on them, and at least from the exterior, get an idea of the current condition of the property they’re living in.
There’s also nothing wrong with knocking on their door, and asking if you can come in to see what their existing home conditions look like. A surprise visit can tell you a great deal about them. And if they choose to not allow you in, that will tell you a lot about them as well. After all, they’re the ones asking you for the right to rent out your unit. So if there are any problems in their existing home, you’ll want to scope that out prior to signing any lease with them.
In addition, another new approach for tenant screening nowadays is to do online searches of your prospects. This includes checking social media for information on them. Is it spying on them? Well, yes. But just like an employer checking on a prospective new hire, you do have the right to do a little checking up yourself when economics are involved. It’s perfectly legal. But more importantly, it can ultimately save you a tremendous amount of money in fix-up repairs to your rental property in case you choose a tenant unwisely. So check their Facebook page, see what photos they’re posting, and if there are any photos of their existing homes, and what condition they’re in. See if they’re party people – you’ll get a good idea of that by looking at their posted photos. More parties equals more wear and tear on your unit, which will end up costing you more in repairs and maintenance.
Don’t forget that the internet can be a place with much false information too. Prospective tenants can post false information designed to deceive unwary landlords. So credit and background checks may not be so foolproof as they used to be anymore, because false information (disinformation) can be widely disseminated very easily nowadays.
In addition, prior landlords can be “set up” by the prospective tenant to await your call, and give that tenant a glowing review. In fact, these people may not be prior landlords, but in fact could be friends or family.
A few pointed questions about the landlord business and their current holdings will help you uncover their veracity, and give you a good idea just how real the reference is turning out to be. Then you’ll have a much better idea of whether to trust the prospective tenant.
Give foreclosure applicants a second look
So always be wary when choosing your tenants. But don’t cut off prospects for bad credit alone. Many new tenants have just gone through foreclosures of their own homes and need the help to get proper housing these days. With vacancies so tight overall in the U.S., as average rental property rents continue to tick upwards nationally, anyone with a bad credit history due to a foreclosure is going to have a tough time with any new landlord.
So it is important not to just write them off as being poor credit risks by the virtue of their having gone through a foreclosure process. Dig deeper. Go the extra mile. Find out what kind of people they are. Check with their current employers. See how long they’ve been at the same employment. If you do all this homework, you’ll certainly find that a large number of people with poor credit these days were placed into bad economic positions by the overall state of the economy – and not necessarily due to their own negligence or actions. Looks can be deceiving, so always scratch more than the surface when investigating your prospective tenants.
Going the extra mile
You’ll find that a little extra research may garner you a really fine, long-standing tenant for your rental property. This will provide you with steady rental cash flow and little repair costs for your unit in the long run. After all, it’s your goal to keep all your units occupied with the best tenants – at all times. This will help ensure your cash flow remains high, while helping to increase the overall valuation on your property.
photos courtesy of 99problems.org, brookdale-pms.co.uk, clickpropertymanagement.co.nz, ushousingconsultants.com, best-realestate.com.au, readharding.com.au, homesathomes.co.uk