Tenant Screening 101: Red Flags You Want to Catch
Dec 28th, 2017
Ask any landlord who has suffered a bad tenant and they will tell you the importance of tenant screening. As a landlord, you do not want a tenant who is in deep debt, has failed to honor financial commitments, or has a criminal record. The screening process allows you to take a close look at the tenant’s character and their ability to abide by the rental agreement. As one of Edmonton property management companies, we come across many landlords who find it difficult to screen tenants. Although every tenant is different, there are certain red flags that indicate a not so good tenant.
Bad Credit Score
Checking the credit score and taking a close look at the tenant’s financial history is a vital part of the screening process. After all, you do not want to go without rent for months. A credit score tells you whether or not the applicant is financially responsible. It tells you their ability to pay rent and indicates their financial stability. A credit score below 650 is definitely a red flag and may indicate potential problems.
Poor Income to Debt Proportion
An applicant with a poor income can be a bad tenant choice. While this can be true, not every applicant who has a low income is a bad tenant. When screening an applicant’s financial status, consider income and savings in relation to their debts and the rent they will be required to pay. If a tenant has debts but ends up saving enough, then they may be able to pay you. But, if debts go beyond their income, it is definitely a red flag. Considering factors like whether or not they have medical insurance, their tax liabilities, age, etc. will help you decipher their income and debt balance and ability to pay rent.
Keeps Relocating Frequently
Has this tenant changed homes more than 2-3 times in a span of 1 year? It could be a potential red flag. Chances are they have been evicted or are going to be evicted. They may want to relocate before they become homeless. Such tenants could be repeat offenders, may have not honored the rent, and may also have a criminal record. Checking with their previous landlord and neighbors is the best way to find out whether or not you can hand over the key to them.
Has Been Constant Offenders
A criminal record check is a must when screening tenants. Every possibility of offense, right from heinous crimes to parking tickets must be checked for. But, how do you identify a potential criminal? A parking ticket may come up due to various reasons. If you see several court cases (even the pending ones) or find out that the person resorts to violence, then it is a huge red flag. While minor speeding and parking tickets may not matter, several of them and DUIs do.
Considering these factors when screening tenants, can help you prevent an encounter with a bad one. While this may seem easy, tenant screening process can get taxing and time-consuming. Connect with an Edmonton property management companies like us and you can ensure quality tenants.