One of the most important elements of operating a rental property business is the ability to find the best tenants that you can trust to take good care of the home and make their payments on time. The fastest way to lose money in the rental property game is to lease your rental properties to people who are considered high risk. Before you start renting out your property, consider these tips to help you find the best tenants.
Make Sure Your Prospects Fill Out An Application
Creating an application that requires vital identifying information is the first step in making sure your tenants have a positive reputation. Consider including these elements:
- Full name, including any aliases
- Birth date
- Social security number
- Current and past two addresses
- Current and past employment
Make sure you gather information from all individuals who will live in the home. Anyone who is hesitant to provide this information should send up a red flag.
Complete Background Checks, Credit Checks, Evictions Checks And Criminal Checks
A criminal background check can give you peace of mind that your tenants don’t have a serious criminal record that could cause problems. Unfortunately, this is no guarantee your tenants will be the ideal residents, but it does decrease the risk. In addition to the criminal background check, you should run a credit check, an eviction check and bankruptcies check to ensure your tenants are likely to pay their rent on time. We also check for child molesters and terrorist activity, just to be on the safe side. Getting as much information as you can on a prospective tenant will save you time and headache in the future.
Ask For References
Even bad tenants have been known to be honest on applications and pass background and credit checks with flying colors. Another way to evaluate the quality of your tenants before you accept them into your homes for rent is to ask them for a list of references, preferably former landlords. Make sure you confirm the references to avoid talking to family members or friends instead of their real former landlords. Employer references are also very valuable as you will get an idea of how well they are doing at work and the likelihood of them staying there.
Listen To Your Gut
It may seem cliché, but your natural instincts can tell you a lot about your prospective tenants. If you interview an individual or a couple and feel like something isn’t adding up or you simply get a bad feeling, it’s often best to listen to your instincts. When you rent out a home, it’s more difficult and costly to evict someone if they turn out to be a bad tenant, so it’s often worth it to listen to the voice in your head rather than taking a risk against your better judgement.
Finding the best tenants for your rental properties can be a difficult task. You need to make sure you rent your home to someone who will take care of it and pay their bills on time. To ensure you find the right tenants for your rental properties, require a full application, a complete background and credit checks, ask for references and listen to your instincts. When you take these steps, you decrease the risk of encountering bad tenants.