Who will be living in your rental property? Are they the best choice for your unit or will they never pay their rent on time? Will they cause damage to the property? Will they vanish in the middle of their lease? Unless you do a background check you won’t know anything about the person except what they put on their application and how they present themselves to you. Often, this is not enough to make a good decision. Background checks are essential, but they can be difficult if you don’t know how to begin. Fortunately, we can handle the background checks for you.
Why You Need Background Checks?
Landlords who have opted not to have background checks often come to regret their decision. They end up with tenants that are always paying their rent late, or who may go for months without paying all of their rent. Other times, they have belligerent tenants who are aggressive toward them and the neighbors. They may have tenants that do not bother taking care of the property or that could be causing damage to the property on purpose.
Background checks can also make the property safer for yourself, neighbors, and other tenants. If someone has a history of violence and drugs, it’s natural to think that they could bring those elements to your property. If safety is a concern, it may be possible to deny an applicant because of criminal history. However, there generally needs to be proof that the decision is to ensure the safety of the community and property. We can provide you with background checks to find the right tenants for your property, so you don’t have to worry about safety.
Background checks can give you more insight into how a tenant behaves in the property. You can see whether they pay their bills on time, whether they have been evicted in the past, and how long they tend to stay in a location. This can help you choose tenants that will reduce the amount of tenant turnover you have in your properties.
Background checks will also reduce the risk of dealing with professional tenants, which is a growing problem. This is a term used for renters that will move into a location and stop paying rent after their first month. They will start to file complaints about bad living conditions, so it is harder to evict them. This can put the case in court for months, and during that entire time, they will not be paying rent. Background checks will look for this type of behavior in their history, so you avoid these types of tenants.
Background checks will help to verify the information that potential renters put forth about themselves on the application or when they are talking with you. They can make sure that there is no false information on the application, as well.
These types of checks are not just a good option, they are essential today. Since it can be difficult to know how to conduct these types of checks fully, make sure you work with a property management company. Let’s get a closer look at the sorts of things that we look for in the research.
The Background Check: What is Included?
Background checks should be comprehensive, but many landlords opt for a cheaper or faster means of choosing their next renters. As mentioned, this tends to be a terrible idea. When we provide these checks, we go deeper and cover a range of subjects. This ensures we know more about the applicants and can make a better decision on whether someone should get the rental property or not.
Credit Report
A credit report will often be the first thing that’s examined in a background check, as it can provide a lot of information about a person. Namely, it can give a good indication of how responsible a person is when it comes to their finances. Are they the type of person who pays their bills on time, or do they let payments go for months or longer without paying? The credit report can show you whether there have been any judgments against the person or if they have been or are in collections. You can learn about bankruptcies and their FICO score, as well.
While the credit report will give you a good snapshot of the renter’s financial history, it is not the only thing that needs to be checked. In some cases, a person may have had a rough patch in their life, which could have dinged their credit. The score itself is good to look at, but it should not be the only indicator that is used. This should, however, be the start of the background check. It can often help you to determine when some people have a pattern of not paying their bills. It’s better to know this now before offering to rent to them than having late or missing payments on your property in a few months.
SSN Verification
Why does the Social Security Number need to be verified? The SSN is typically what is used to verify a person’s identity, as well as retrieve their address history. There have been instances of identity theft where people have used another person’s SSN as a means to get credit, buy a home, rent a property, etc.
The SSN is needed when running a background check, and it will ensure that the person who is using the number is the person who is looking to rent from you. There is no way to determine they are who they say they are without SSN verification. Faranesh Real Estate and Property Management knows how important it is to ensure that all of the documentation is accurate and will ensure that the person applying is who they claim to be.
Criminal History
The background check will also delve into a person’s criminal history. Having a criminal history report will help property owners to ensure that their property and other tenants are safe. It can also protect the property owner’s liability. It is important to understand and follow the law when it comes to whether you can opt to not rent to someone who has a criminal history. Typically, you can’t decide that you don’t want to rent to someone based on their criminal history unless you believe that it would be dangerous to have them on the property.
The laws can be difficult to understand here, so you will want to allow us to handle these criminal history checks and determine the best course of action. Remember, everything you do with your property needs to comply with the law, including choosing renters, so it is better and easier to allow us to handle it all for you. This way, you will not be on the receiving end of a lawsuit if a criminal decides you based your opinion on their past without merit.
Rental History
One of the most important things to look at in a background check is the applicant’s rental history for at least the last two years. Where have they been living and why did they leave the last place? Have they been to several different locations during that time? If they have only a short time at each of the locations, you can be relatively sure that they are the type of renter who lasts for just a six-month lease before heading to find a new place to live. Maybe it’s because they need to move for work, or maybe it’s because they have problems paying rent on time. They might also have personality clashes with the landlord. There could be any number of reasons.
Knowing the rental history will give you a better idea of what you can expect from the client. Were they paying their rent on time? Were they causing problems with other tenants in the building or with neighbors in the community? Were they filing complaint after unwarranted complaint? The more that you can learn from the rental history the better. It can determine whether they might be a good—or bad—fit for your property. Examining the rental history now can give you a good idea of what you can expect from the tenant.
Typically, you will want to find new renters that are going to be willing to sign a longer lease and that are likely to stay in a property for several years. This means less marketing and work on your part, not to mention steady income from the rent.
Employment Verification
You need to know that the applicant will have the ability to pay for the rent each month. Naturally, this means verifying that they have an employer and have worked there for at least several months. Of course, if someone is brand new to the area, they might have just recently started a job, or they could still be looking. Still, you want to be sure that they have the means to pay for their rent.
Check into the employment history to see how long they tend to keep jobs. If they flit from one job to the next, they do not have financial security. This could end up being a problem for you since it means they may not be able to pay rent on time. It might also be an indicator that they don’t like to stay in one place long, which means they might only be a short-term renter for you.
Keep in mind that employment doesn’t always mean having a nine-to-five job. If you can verify that they are self-employed or that they receive funds from retirement accounts or Social Security, it could account for income. The important thing is to be sure that they have enough money to pay their rent each month.
Public Records
Background checks will often look into public records, as well. This is something that landlords could do on their own since the records are, as the name suggests, available to the public. However, it can sometimes take quite a bit of time to find all of this information. Our property management company can handle the background check and search the public records for things like suits, liens, evictions, etc. When you find people that have had several past evictions, for example, it may indicate they are likely to have the same troubles when they are in your property.
References
As one of the last steps that are usually a part of a background check, the references play an important role. Both personal and professional references must be collected and used, in most cases. The references should provide a better understanding of who the person is on a personal level. It’s a good idea to ask open-ended questions, which will allow the reference to elaborate. You can learn more about them and how they handle different situations, which can give you an idea of whether you should allow them to become one of your renters.
Faranesh Real Estate and Property Management Makes It Easier
We know how busy you are and how many other things you have to get done, which is why we can provide a check for the potential tenants. We strive to make the process as simple as possible for you, and you don’t need to be involved at all. We can provide a full credit and background check through Experian and will get the signed consent form from the applicants for these checks. Our team will take care of all of the different elements of property management, not just checking the history of the would-be residents.
We can provide all of the leasing services you need, including marketing to find new tenants, interviewing tenants and showing the properties, providing inspections, maintenance, repairs, collect and holding the security deposits, and gathering the rent each month. Our company will handle tenant issues and requests, as well. This ensures that you don’t have to deal with any of these problems. Let us handle all of the hard work.
