One of the country's hottest rental real estate markets is Wantagh, NY. Owning rental property here sets you up for a successful and profitable experience. However, the right tenant can make or break your experience.
By performing tenant background checks, you can screen out potentially problematic tenants. Having a system in place is essential for ensuring consistency and thoroughness. These five steps will walk you through the most crucial tenant screening tips.
Steps for a Thorough Background Check
- Gather information and approval
- Obtain a credit check
- Review the rental history
- Verify employment and income
- Request a Tenant background check
1. Gather Information and Permission
During the lease application process, you should include a form that requests approval to run credit and background checks. The Fair Credit Reporting Act (FCRA) makes obtaining this consent a legal requirement. This law makes it illegal to run these checks if you do not secure tenant verification approval.
In addition, you should have the applicant fill out an information form. It should include a place for the applicant to fill out all of their information.
2. Obtain a Credit Check
Once you have consent, obtain a credit check. It will include several pieces of financial information.
- Credit report
- Debt owed
- Bankruptcies
Review the report for signs that the applicant could be financially irresponsible or unstable. Examples include a low credit score, a high amount of debt, or a recent bankruptcy.
3. Review the Rental History
Look at the applicant's rental history for signs of stability and consistency. A tenant who moves frequently is unlikely to renew their lease with you. A tenant with evictions in their rental history is more likely to get evicted from your property.
Talk with previous landlords to find out how they were as tenants so that you can avoid potentially problematic individuals. Ask the previous landlord how they left the property to reduce the risk of excessive cleaning and maintenance costs.
4. Verify Employment and Income
Speak with the applicant's employer's human resources department. Confirm the information the applicant provided you about their employment history. Ask about the length of employment and their pay rate.
Verifying income and employment is essential in tenant screening because this is how you determine if they can afford the lease for its entire term.
5. Request a Tenant Background Check
Have a background check run on the applicant to get a more complete picture of who the applicant is. This report will include a criminal history report. However, be careful disqualifying an applicant based on their criminal history.
New York City has enacted the Fair Chance for Housing Act. A landlord cannot ask about criminal history until they make a conditional offer for housing.
Effectively Screen Tenant Applicants
Following these tenant background check steps, you can thoroughly screen applicants for your rental property. Start by gathering information and gaining consent. Then pull the relevant reports and records to analyze and verify the information.
We follow a thorough tenant screening process at PMI Empire Solutions in Wantagh, NY. By staying consistent, we ensure legal compliance while reducing landlord risk.
Navigate the hottest real estate market confidently by partnering with PMI Empire Solutions for expert tenant screening and rental property management services.
