As a landlord or property manager, you’ll likely encounter hundreds or maybe even thousands of applicants over the years – especially as your portfolio of rental properties grows. For those who make it through the automated screening process, the next step usually involves a personal screening, either over the phone or in person. How this process pans out can make narrowing down your options even easier. Here are a few questions or concerns that could be a red flag.
Are you going to run a background check on me?
When this question comes up, it can be helpful to clarify what your standard criteria is for tenants. Letting an applicant know right upfront what your expectations and requirements are in order to qualify as a potential tenant will save you both time. If they’re not willing to submit, then you’re unable to proceed. Simple as that. (We recommend having your criteria reviewed by an attorney to ensure that you are in compliance with all laws, rules and regulations.)
Can I pay the deposit in installments?
Understandably, coming up with a lump-sum of money can sometimes be challenging – even for the most ardent budgeter. That said, when someone isn’t willing or able to cover the cost of the security deposit, it could be an indicator of future payment issues. If money is tight now, what might happen should an unexpected car repair or medical bill arise? Will there be enough of a cushion or will you find yourself chasing the rent? As a landlord, a full, upfront deposit is one of your only means of protection.
I’m rebuilding my credit.
Many people fall on hard times, and that doesn’t always mean they’re necessarily a long-term risk. That being said, an applicant’s creditworthiness is still an important factor in whether or not they would be a good candidate. If you do your due diligence and the applicant seems to be back on track financially, you might be ok taking a chance, but just be aware that even though someone has a good excuse for why they’re credit rating is bad, that doesn’t necessarily mean their excuse is legitimate.
Can I move in right away?
When someone is eager to move in immediately, it could be on the up-and-up. It could also be an indicator that they’re a higher risk, such as someone who just got evicted or left another rental property without providing adequate notice. At the very least, this question should prompt you to ask a few follow-up questions of your own to try and get to the bottom of why they’re looking to move so quickly.
I’m living with family OR I don’t have any prior landlords.
Collecting and following up with references – especially those of former landlords – is an essential step in proper tenant screening. When someone is hesitant to provide this information, it could mean they have something to hide. Likewise, the fact that someone is currently residing with a friend or family member could be completely innocent in nature. Or, it could be an indicator of past problems with other landlords. Go with your gut, but just be aware that a lack of viable references and/or prior rental history can dramatically increase the risk to you.
Screening tenants is a critical step in getting and keeping your rental properties filled with responsible, long-term and financially-fit tenants. While the five things listed above are not always indicative of a potential problem, they should be enough of a red flag for you to dig deeper and be more strategic in your decision-making.