Most of the landlords we talk to are worried about two things: bad tenants and eviction.
This is understandable. The type of tenant you place has a major impact on the success of your Killeen investment property. Good tenants will pay rent on time, help you maintain the home, and follow the terms of their lease agreement. Bad tenants will pay late or not at all, leave property damage behind, and take advantage of you whenever they can.
Tenant screening is vital. With a good screening process, you’ll decrease your eviction risk and increase your profitability.
Check Credit and Payment Histories
Credit scores are important, and it’s pretty standard to set a minimum when you’re establishing your rental criteria. More important than the credit score, however, is the credit history. If you see a history of on-time payments for the things that matter, such as phone and utility bills, but the applicant is behind on their student loan payments or has a lot of medical debt, you shouldn’t worry too much about the tenant’s finances.
When you’re reviewing an applicant’s credit report, take a look at what the overdue bills and missed payments reflect. If you see outstanding water bills, utility bills, phone or cable bills, it could mean trouble. You want tenants who take their housing payments seriously. If someone cannot or will not pay an electric bill, there’s a good chance that they may not pay the rent, either.
Verify Income and Employment
Income standards are also an important part of screening tenants. The industry standard is typically to require that tenants earn at least three times the amount of your monthly rent. It’s a good starting point, and it ensures that your tenants are bringing in enough money to pay you on time every month.
Search for Past Evictions
Conduct a nationwide eviction history check. We do not recommend renting to anyone who has a recent eviction on their record. Setting this standard for every application will keep you consistent and fair. Past behavior often predicts future behavior, especially when it comes to rental performance.
Conduct a Rental Reference Check
Talk to current and former landlords. You want to get a rental history that matches the profile of your ideal tenant. Ask whether the tenant paid rent on time, if any damage was left behind, and whether they gave proper notice before moving out. You can talk about pets and whether there were any conflicts or disputes. The most important question to ask of former Killeen landlords: would you rent to this tenant again?
These are just a few of the things to look at when you’re screening tenants for your rental property. We know it can be overwhelming if you don’t have the experience and the resources that professional Killen property managers have. We can help with that. Our eviction rate is low and our tenant retention rate is high, and we believe it’s partly because of the thorough and rigorous process we have for screening potential tenants. Please contact us at Shine Residential Management.