There are many people that end up with issues like destroyed houses, robberies, battery and rent defaulting in their rental premises because they are too trusting. If as a landlord you want to manage your property better and get the best out of it, you need to make sure that you know everything that you need to about the people asking to rent the units. Here are a few reasons why performing a background check for tenants is advisable for all renters.
Avoiding loss of property at the premises
If you make the mistake of taking in clients who have criminal tendencies, it is possible that they will be getting mixed up in issues such as gang violence. When this happens, the other members will keep vandalizing the unit belonging to the character in question and you as the landlord may have to foot the cost of repairs. Also, when you let in a criminal, they will start intimidating you and making it very hard for you to get the money needed for rent and repairs and other required payments.
Knowing your renters’ income source
As a landlord, it is very important to make sure that you have verified the truth of the claims your renters make with regards to place of employment and their occupation. When you hire a private investigator for the background check for tenants, make sure that that they actually visit the person’s place of employment and verify that they actually work there. In case the report given is not accurate, it is wise to avoid dealing with that person.
Another thing that will be important to look into is the client’s current residence records. It may seem insignificant, but the truth of such information will determine whether there are things that tenant is hiding or not. Besides that, there is a lot of information about a client that you can gather from where they live. Such details include the character of the person, whether they are a peace loving citizen or they are the type that will lead to numerous calls to the police for domestic disturbances and many other important things.
Judgment and lien search
As a landlord, you should do everything possible to avoid problematic clients. These are the people that will create issues such as court cases because of minor complaints at the premises. A way of figuring out if someone is a complainer or not, is conducting a judgment and lien search. If they have sued a previous landlord and won, their name will be I the public records. While not all the people whose names appear in the search will be problematic, it is better to be careful with people that have such tendencies. Let the person conducting the background check for tenants figure out all the details of the search.
One of the most exciting bits of the work for a real estate property owner or manager is getting tenants once the house is open. It can also turn out to be the most stressful part. This is because you are supposed to ensure that the people you let in to your house are responsible and law abiding citizens and that they will not create problems in the premises and for other tenants. In order to get this information, you need to hire reliable tenant screening services. Here are a few tips that will help you select the best.
Accuracy of the reports given
Look out for companies that claim to give 100 percent accurate reports. Most of the times, these companies are embellishing to drum up business for themselves. It is wiser to opt for the companies that are honest about their ability that the liars that promise accuracy and add disclaimers at the bottom of the service agreement. The presence of a disclaimer or what is known as fine print means that the company wants to be absolved from any blame in case anything goes wrong after the screening. Tenant screening services which have faith in their work and its accuracy will not have these disclaimers.
Double checking the criminal records report
The criminal records always contain the most inaccuracies in these reports. The problem occurs mainly because the data that is being inputted is rarely verified. Also the data that is being offered as output by the databases that some of these companies rely on is rarely if ever crosschecked for accuracy. The reliable company will not just download the data and hand it to you, they will have people to go on fact finding missions. They will verify all the claims before they hand them to you.
The inefficiency of local level criminal searches
Normally, when people commit crimes, they will run from one state to another to avoid having to face the law. If for instance a person committed robbery in another state and they have come to start over in the state where your property is located, local level searches will show the person has a clean criminal record. It is wiser to engage the company that will carry out a nationwide search because this will make it easier to nub the out of state offenders.
Compliance with FCRA
Even when hiring tenant screening services, you have to remember that the person being screened has rights. The company you involve should therefore be FCRA compliant. This means that you cannot use their credit information to make wrongful decisions about whether to offer the person or company housing or not. Make sure that the company you hire does not engage in corrupt and illegal practices in an attempt to give the best.
If you are a landlord in charge of either residential or commercial property, it is important to think about the people you are going to rent your buildings to. Nowadays, laws on landlord tenant agreements and relations seem to have given more preference to the tenant. As a landlord, you need to be pro-active and gather all the facts you need about the tenants to avoid surprises in the future. Hiring a company that specializes in digging up background information about potential clients is common and advisable practice. Here are a few things that you should always look out for in the tenant screening report.
- Consumer credit report
This will help you know whether the prospective tenant is able to meet their bills or not. Most of the time, when a tenant is having issues like low credit scores, credit debts and even extremities like bankruptcy, they end up becoming the problem client who just can’t pay the rent on time. to avoid the hassle, find out about the credit report and stop the problem before it starts.
- Eviction records
A tenant having a good credit score shouldn’t be the end of your search when it comes to the tenant screening report. The other thing that you need to think about is their history as a tenant and ho they have related with their previous landlords. In case they have been evicted in the past, find out exactly why they were evicted. You can consider them if from your objective point of view, the landlord was at fault. However, if they seem to have a stream of evictions, it will be prudent to avoid the person.
Another thing that you do not want tainting the safety record at your premises is housing a sex offender. Most of the times, the law requires previous sex offenders to register their current address and the address will be marked to warn parents, children and other susceptible people. you can imagine the complications that would arise when other prospective clients search your rentals and find that a sex offender lives at that address. Ignorance could lead to you wondering why people won’t rent your beautiful houses. Ensure the tenant screening report that you get contains this information.
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- Criminal records
There is nothing that is more traumatizing than a landlord waking up to yellow police tape around their premises and being told a crime happened there. An even worse scenario is if a gang member moved in at your house and their friends started harassing the other neighbors forcing them out. Legally, if you have no proof that a person is criminal, evicting them cold bring up discrimination charges. Before you get to this compromising situation, let experts use their means to learn about the prospective tenant’s source of livelihood. If the tenant screening report shows the person is shady, do not let them in.
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Most people that offer tips and advice on investment state that real estate is one of the smartest forms of investment. Well, judging from the fact that real estate property seems to be appreciating every year, it is safe to say that they are right. However, what most of these people will not tell you is the challenges that you will face as a tenant, especially if and when you decide to invest in rental property. One of the things that you need to understand is the importance of doing tenant screening before allowing anyone into your premises. Here is why you need to do screening beforehand:
There are many things that are investigated by the people who do these screenings. To start with, they will want to look at the credit report of the tenant in question. This is done by digging up bank and online transaction history. This is important because you need to know whether the person you are about to offer accommodation can afford to pay for the same. Most experienced landlords state that it is simpler to avoid taking in a tenant who will not pay their rent in time than trying to kick them out after they have already defaulted. Other complications that come with not finding out the financial state of a tenant include:
- Losing money when the tenant is completely unable to repay the amount that they owe.
- Getting involved in court cases and settlements that are related to landlord tenant agreements.
- Being unable to attain the profit you had projected that you will earn from the investment.
To avoid these huge losses, simply conduct a tenant screening beforehand.
Averting danger is another thing you need to think about when screening. All types of people will approach you wanting to rent a house. Some are law abiding citizens while others aren’t. Most landlords that decide that ignorance is bliss end up having yellow tape around their premises and police, detectives and news agents telling horrifying tales of what happened at their premises. In short, find out who your tenants are. Are they drug peddlers, murderers, ex-convicts and so on? This will help you avoid the tenants that could cause you issues such as putting the lives of other tenants in danger.
Naturally, when a certain real estate property starts having a reputation for crimes and violence, its value depreciates greatly. For instance, when an area is listed as a violent neighborhood, the cost of the property goes down and you will also be forced to push down the amount that you ask for the rentals. Tenant screening helps you protect yourself from such complications even before they occur. Having some background information about your tenants will also be very useful in case certain situations spiral out of control and measures such as court cases result.