Our Guide to Finding the Right Tenants

by Lilly Rabinowitz on October 24, 2017 , Comments Off on Our Guide to Finding the Right Tenants

One of the biggest challenges of being a successful landlord is finding the right tenants. You want courteous, responsible tenants who will be timely with the rent and take proper care of your property.

Tenants who don’t fall into these categories can be nightmares for landlords. Without properly researching your tenants, you can be stuck with renters who trash your property or are notoriously late with the rent. Even worse, you can find yourself with squatters who refuse to leave and refuse to pay you a single cent.

How can you be sure you’ve chosen the right tenants? Is there a way to check whether a potential renter is who they say they are? What qualities should you be looking for in a tenant?

So many questions – but we’ve got the answers! To make this task easier for you, we’ve compiled a handy list of dos and don’ts to keep in mind when you’re searching for tenants.

Do: Screen every prospective tenant

This is more than just asking for a reference or two. You’re going to have to do extensive research if you want to have trustworthy tenants.

It’s best to create a rental application which will give you all the information you’ll need. Include the following criteria on your application:

• Applicant’s job, direct supervisor, and annual income

• Applicant’s current address

• Contact information for applicant’s previous landlord

• Government identification

• Names and numbers of friends and family members

This information will allow you to gain a clear understanding of who your tenant is. Also, by asking for details on the applicant’s family members and friends, you’ll have someone to contact if the tenant does a disappearing act.

Don’t: Fall for tenant scams

In our digital age, it’s easy for someone to create a fake life for themselves. For a landlord, this can translate into fake documents for a prospective tenant, leading the landlord to believe the renter is someone he is not.

After a month or two, the rent checks will start bouncing. When the landlord approaches the tenant for a new one, the renter will start complaining about horrible property conditions and refuse to pay the rent. The landlord now has a squatter on his hands and is stuck losing money each month.

Don’t be the next victim! Here’s how to protect yourself:

Don’t rely on credit reports. They are not a clear indicator of a prospective tenant’s financial standing. Ask for genuine proof of income.

Don’t take any documents at face value. Sure, the guy provided you with an electric bill to prove his last place of residence and a pay stub to show he’s gainfully employed. But how do you know those documents aren’t falsified? Check addresses and business names online to make sure you’re getting the real deal.

Do: Look for red flags

The best way to ascertain a tenant’s character is by being alert and aware. Be on the lookout for any red flags in the application process and when the prospective tenant comes by for a property check.

Is the listed income too high for the tenant’s appearance or job description?

Did the tenant show up unfashionably late for the property check?

Are there gaps in the tenant’s rental history?

Are the tenant’s children unusually rowdy?

Pay attention to every detail now to avoid disappointment later.

Don’t: Accept employer’s checks

In yet another tenant scam, a prospective renter will tell you he’s moving to your location for a job. His employer will send you a check for the first month’s rent, only the check is made out for a much larger amount than you need. The tenant will then ask you to pay him the difference before you cash the check.  Of course, by the time you send him the change, he will be long gone. Worse yet, when you try to cash the check, it’ll bounce.

Avoid these scams by refusing to accept any checks from a prospective tenant’s “employer.”

Do: Create a comprehensive residential tenancy agreement

This document will establish the terms of the working relationship between you and your tenant. Get as detailed as possible. Having everyone’s rights and responsibilities clearly documented can ultimately prevent disaster. You’ll have this agreement on hand to refer to in case of any challenges or disagreements that arise.

Before you sign up with any tenant, make sure they check out!