July 4, 2008
Landlording – How to screen potential tenants?
Being a landlord is one thing, getting perfect tenants for your property is an entirely different matter. As a landlord, you might have experienced tenants in all sorts of shapes and sizes; good ones, bad ones, etc. They come with all financial predicaments, you can think of.
Most of the landlords don’t have specific criteria for screening tenants. They normally accept anyone who is willing to pay them money. This is the biggest mistake. You should always consider accepting tenants who are responsible with their money and can pay their rents on time.
Following are some rules that must be followed before you ever allow a potential tenant to move in.
- A verified Job – The tenant must have a steady job to fulfill his necessities including the rent. No work mean no money to pay rent. Simple solution, make sure they show you a recent pay stub along with employer contact info so that you can call to verify employment. If the potential tenant is a student. This rule doesn’t apply. For students, you should verify their source of income or the money they are getting from their parents/guardians
- Good References - Get referrals from landlords prior to their current landlord. Their current landlord may give them a good reference just to get them out of their place. Landlord referrals are extremely important to screen the potential tenants
- Decent Credit – You should check a tenant’s most recent credit report. You can get it yourself too through various websites online. Tenants with poor payment history usually results in a high probability of rent payment default
- Enough Cash for a security deposit and first months rent - If the tenant doesn't have the cash for security and first months rent on or before move in date, then I move on. Some tenants will try to pay you a portion of each because they don't have the cash. To me, having some cash in the bank shows money management responsibility which means lower chance of rent default.
- Single older lady or a man as a tenant – There is nothing here against older ladies or men. But most of the older people don’t have a source of income and therefore, it is probable that they are needy. But you should prefer low maintenance tenants (Going to go to hell for this?)
- No Pets – If the tenant has a dog, (nothing against dogs here), you should ask him politely to leave the dog somewhere else. Normally owners don’t seem to clean up the mess their dogs make in the yard. So the general rule is “No Pets”
- No smoking inside the premises - Smoke causes a stink that lingers. The only way to get rid of the smell is to wash/repaint the walls and/or wash/replace the carpets. Besides, indoor smoking in Canada is slowly becoming a taboo.
- Meet all parties before accepting the application – If the tenants are a couple, it’s usually good to meet with both of them. There are many landlords who used to accept a new tenant based only on meeting one of them and it usually turns out to be a big mistake because the spouse of the tenant meeting you is a psycho or a criminal.
I hope that most of the landlords out there will agree with these rules. But if you think I missed out something, let me know. Normally, these are the basic rules that you should apply while screening out the tenants. It is a general understanding that a good tenant can make your house a home and a bad one can destroy it.
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