Protect Yourself From Bad Tenants With Credit Checks
Conduct a credit check before renting to determine the tenant's quality to avoid unpleasant surprises.
Evicting a tenant from your rental property is something no landlord would ever want to go through. Unpaid rent and damage to the house cost thousands of dollars, not to mention the time spent and all that frustration. It's impossible to analyze people by their outer appearance alone. Landlord horror stories can start with a gut feeling about the renter or a pressure to find someone to rent the space. Tenant selection is crucial because poor decisions can lead to evictions, which are disruptive, expensive, and time-consuming.
What is the best way to make sure that your tenants are good? Make sure you do your due diligence before accepting a rental application. In order to determine whether a prospective tenant is a responsible fit for your home, make sure you check the rental history and run a credit check, along with income or guarantor information.
Credit checks are crucial to the tenant screening process. The report offers an overview of a person's financial situation, including the amount of debt they have and the history of bill-paying. In a credit report, people whose financial obligations have been met in the past may be predicted to do so in the future. Depending on your jurisdiction, you may be allowed to charge renters a screening fee.
An individual's credit score may range from 300 to 850. For red flags that indicate the applicant has financial problems, check the amount of debt the renter has, if there are any late payments, and whether the renter has any previous bankruptcies, liens, garnishments, car repossessions, or accounts in collection.
The LuckRent App has a built-in application form that allows you to collect information about prospective renters. Renters can send you the application with consent for you to run credit checks. You can then go to the credit bureau to order credit reports easily from the app.
Landlords want to ensure prospective tenants will pay rent on time and respect their properties by thoroughly screening their applications. Some good questions you can ask the renters include the reason they are moving, who will be living at the property, how long do they think they will stay, where do they work, and when are they looking to move.
It is important to remember, though, that there are certain questions you cannot ask your applicant during the vetting process. It is illegal for landlords to discriminate against tenants because of race, gender, religion, or other factors specified in the law. All applicants should be treated equally and respectfully when renting a unit. Making sure that the housing you operate is free of harassment and discrimination is your responsibility.