Tenant screening. Likely one of the most important factors in renting. You want to ensure that you are selecting the best people to occupy your property. This is a process that takes time, and that needs to be approached in a very legal matter, as you can get into some legal hot water, if you start discriminating.
How do I screen my tenants?
There are many resources available to you, however some do rank better than others. Personally, my organization uses Naborly Inc. which is a Canadian tool, for landlords. They handle the entire process, from the application, to processing the applicants credit and criminal background checks, and providing you with a comprehensive report, to allow you to make a proper decision. I forgot to mention, this is entirely free.
You of course can opt for a more traditional process, of a manual application, reaching out to credit bureaus, contacting past landlords, and reaching out to the RCMP for background checks. Ensure you check the validity of the applicants rental references.
What to look for in an applicant?
There are a few key factors that you want to look for when analyzing all the information you’ve gained on the applicant:
- Debt to Income ratio (their ability to pay you)
- Bankruptcies, or other claims
- Past evictions, property damage, length of tenancies
These are just a few, but it comes down to a simple formula, ensuring they’ll pay you, the don’t have tendencies to miss payments, and that they have respected their previous rentals.
Making a choice.
This can be the toughest part, and this is where you may feel guilt, or like you’ve made the wrong choice. However, if you’ve done your research, and you know as much as you can, you have to go with your gut. Ensure you treat all parties with respect, as nobody wants to hear that they have been rejected for an apartment. Feel free to explain why, however you are by no means required to go into detail, it can look like this:
I want to thank you for considering COMPANY NAME, however at this time, we have elected to proceed with a different applicant.
Should you have any questions, or require further explanation, please don’t hesitate to reach out.
While this is just an example, it is a good boiler plate email. Of course, now you get to congratulate your successful applicant – I’ll leave that email to you, as that should be something special you craft, to build the bond between your tenants.
There you have it, a quick run down of what tenant screening and selection can look like. Now get out there, and build your empire!
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