Bob seemed like a real stand-up guy. Although you generally do your best to remain professional during all of your tenant interviews, he had you chuckling at a lame joke about five minutes into your pre-set list of questions. There were no red flags during the interview, and you were more than happy to welcome him into your property.
Three weeks later you begin receiving complaints from other tenants. Bob has been playing loud music at all hours of the night, getting into arguments with other tenants, and basically disturbing the peace and tranquility that once pervaded your apartment building. What's more, that deposit check he wrote for you bounced. You later find out that superficially charming Bob has a lengthy record of complaints from previous neighbors at his old apartment building and the impressive credit report he handed you was as false as his first impression. You feel like a fool. Of course, all of this headache and financial strife could have been easily avoided if you had simply performed a comprehensive background check before welcoming Bob with open arms.
What a Background Check Can Tell You
Interviewing a potential tenant might reveal a lot, but that's assuming that they are completely honest with you. And let's be real, if a tenant has something undesirable to hide, he probably isn't the type that will come right out and share it merely for the sake of fairness. Anything a tenant gives you such as credit report or recommendation letters should be taken with a grain of salt. That doesn't make you paranoid or overly pessimistic; it just makes you a judicious landlord who has a desire to protect their property and the wellbeing of other tenants.
A comprehensive background check should include:
- Social Security number trace
- National Eviction search
- Credit History search
- National Criminal and Sex Offender Search
There are a number of companies that provide many or all of these background search elements. Many of these businesses are also online so you can order and review the results of the tenant background searches from the comfort of your living room couch.
Each of these reports is crucial for screening potential tenants. A Social Security number trace checks that the tenant is actually who they claim to be and is not using a stolen identity. An eviction search alerts you to any previous evictions the tenant was subject to, which is a major red flag that they might not be the right tenant for you; a previous history of eviction in any state is a very strong indicator that the tenant will default on your lease. A tenant's credit history indicates whether or not your tenant has the financial means and fulfills his financial obligations on time to satisfy the terms of your lease and will thus aid in your lease decision. The national criminal and sex offender search will give you information as to whether the potential tenant will be a good fit into the community your property is part of. A thorough tenant screening will also illuminate any dishonesty on the tenant's part throughout the interview and screening process.
What It All Boils Down To
When you extend a lease agreement to a tenant, you are in essence accepting a certain amount of risk. A comprehensive background check can show precisely how much of a risk you are taking on an individual tenant which allows you to make an informed decision. Hopefully, that decision will save you time, money and headaches further down the road.
Written by Silvia Englert, marketing manager at Houserie.