Every year, landlords in the U.S. file more than 3.6 million evictions. A single eviction can wind up costing a landlord thousands of dollars.
Filing an eviction can cost a landlord anywhere from $15 to $350, depending on the state and county that the property is located in. But that is only the fee for filing your eviction in court.
The true cost of an eviction is often much higher. Landlords face unpaid rent both before filing an eviction and during any proceedings. A bad tenant may leave damage that goes beyond what’s been collected in a security deposit.
If a tenant tries to fight an eviction, the landlord may also be forced to pay legal fees to prove their case in court, which can total in the thousands. Then, there’s the cost of finding a new tenant.
Having a tenant screening checklist in place is one of the best ways to ensure that you’re doing your due diligence in screening tenants. Keep reading as we take a look at what a tenant screening checklist should include and how to create one for your properties.
Tenant Screening Checklist
A tenant screening checklist is one of the best ways to increase your chances of getting good tenants in your units.
Finding the right tenant for your rental properties can not only mean getting rent paid on time and in full but can also help you avoid the cost and stress of evicting a tenant. Finding the right tenant starts with proper screening.
Having a tenant screening checklist can help ensure that your process for evaluating prospective tenants is consistent every time. Without a checklist in place, it’s easy to miss a step in the screening process that could then cause you to miss a major red flag in a tenant.
Your screening checklist should be broken down into the different questions you should find answers to during the screening process. Some of these questions are ones you’ll ask the tenant directly, while others may be answered through background checks, credit checks, and other evaluations.
Here, we’re breaking down the categories and questions that should be on the tenant screening checklist used by every landlord or property manager.
How Long They Plan to Rent
Often, when landlords think of tenant screening checklists, they think of background checks and credit checks. While these are an important part of the screening process, there are other things that you should be talking to prospective tenants about.
For instance, you should ask early in the process how long they plan to rent. If you discover that they are looking for a short-term rental, but you want to rent your property long-term, you’ll know right away that they aren’t the right choice.
This can save you time and money, as you can end the screening process before paying for a background check or spending time calling references.
When Do They Need to Move?
Another question that you should ask early in the process is when a tenant needs to move. If their current lease is up and they need to move immediately, but your property won’t be available for several weeks or months, they may be unable to wait.
Ask this question during your initial contact with a tenant, whether they call to schedule a tour of your property or stop by your rental office.
Why are They Moving?
Asking a tenant why they are moving could help you spot some potential red flags. While these red flags might not be enough reason for you to halt the screening process altogether, they can help you learn things that you should watch for later in the screening process.
For example, if a tenant is moving because of issues with a current neighbor, it could mean that that neighbor truly is a pain. Or, it could be that the tenant is the problem.
You’ll then want to question their current landlord about the situation when you call them and look for a history of moving frequently that could indicate that the tenant frequently has issues with neighbors.
Keep in mind that asking questions like this won’t always get you the full answer. A tenant may not share the whole truth, while a landlord may not know all of the details about why the person is moving.
But it’s still good to ask a prospective renter this question and to try to confirm their answer with their current landlord later in your screening.
One of the most important questions to ask during the screening process is the tenant’s monthly income. This lets you know whether they’ll be able to pay their rent each month and whether doing so will strain their current finances.
As a general rule, a renter should be spending 30 percent or less of their monthly income on rent. In most cases, this leaves enough money for other expenses, like car payments, gas, groceries, and utilities.
A tenant who is relying on savings to pay their monthly rent may be unable to sustain this long-term. This means you could be facing missed rent payments and an eviction months or even a few years after welcoming the tenant.
One part of verifying a tenant’s monthly income is to check their employment information. In your rental application, you should obtain the prospective tenant’s employment info, with contact information for a boss or manager.
Calling to verify that the individual is truly employed by the company they provided information for is an important step in evaluating their income.
Another step in verifying that the tenant will be able to make their rent month after month is to run a credit check.
A credit check will tell you a few things. You can see whether a tenant has a high amount of debt that could impact their available income. You’ll be able to see whether they have a history of missing payments on bills. A credit check will also tell you whether an individual has previously faced bankruptcy.
It’s up to the landlord or property manager what information you use from a credit check to decide whether a tenant is a good choice for your property. But running a credit check to look for major red flags that could indicate an individual may struggle to pay rent is a must.
Previous Housing Records
Another important detail that a property manager or landlord should ask when screening prospective tenants is about their recent housing.
As a general rule, you should gather information about where the individual has lived for the past five years. If they were renting, ask for contact information for their previous landlord or information about the apartment complex. You can then use this information to contact their previous landlord.
When you contact their landlord or previous property manager, there are a few questions you should ask, including:
- How long did the tenant live in your property?
- Did the tenant pay their rent on time? Were they ever unable to pay?
- Was the unit left in good, clean condition?
- Did you have any complaints or other issues with the tenant?
Asking these questions can help you to get a better picture of what to expect from a tenant.
If possible, try to reach out to both the tenant’s current landlord and any previous ones that you have information for.
If a tenant is causing problems in their current home, their landlord may omit negative details about that tenant in order to get rid of them from their own property. Talking to a previous landlord or property manager may help you get a better picture of what the renter is like.
Asking a tenant whether they have pets and, if so, what breeds could be an easy step to overlook. This is especially true if you’ve decided to allow pets on your property. But this is still an important thing to cover before renting a property to a new tenant.
To start, it’s important to establish how many pets a renter has. Just because your property is pet-friendly doesn’t necessarily mean that you’re okay with five large dogs or a dozen cats in your unit.
Additionally, many landlords choose to enforce breed restrictions. In some cases, certain breeds may not be allowed in the county where your property is located.
Just 13 states have banned counties within their states from imposing bans on dog breeds. If your county has a ban in place, you may opt to also restrict that breed.
Or, you might choose to restrict pets over a certain size. If you own an apartment or apartment complex, allowing large dogs could wind up causing an issue with any tenants living below that unit.
Another reason to ask a tenant about their pets upfront is so that you can let them know about any pet fees you charge. That way this isn’t a surprise to your prospective tenants later on in the screening process.
Choosing to allow pets in your rental unit could open you up to potential damage to your property. However, allowing pets in your rentals will open you up to a much larger pool of potential renters.
Allowing smoking in your units or around your units is a different matter. A tenant smoking in a unit can lead to ruined walls, carpets, and fixtures. It can also open up your property to additional fire risk.
As a landlord or property manager, it’s your right to make your property smoke-free. But this is something that you’ll want to discuss with your tenant during the screening process.
Ask the tenant whether or not they smoke. Outline your smoking policy, and where they are allowed to smoke if you have designated areas for them to do so.
You should also outline any additional fees that you charge if a tenant is discovered to be smoking in your rental property. Many landlords even choose to have their tenants sign a separate document that outlines the smoking policy and signifies that they understand the consequences of smoking in the unit.
Never assume that a tenant is planning to rent the property on their own.
While only one individual may be applying to your unit, they could be planning to split rent with roommates or to have other, non-paying adults living with them.
A renter may fail to mention that they plan to have roommates to try to avoid going through the screening process for that roommate.
However, even if the first renter would be able to financially afford the unit on their own, it’s important to screen every individual who will be living on the property.
Ask the tenant about whether they plan to have roommates or other adults living with them. If you choose to perform a background check as a part of your tenant screening checklist, you’ll want to run one for each of the adults living in the unit.
Creating a Tenant Screening Checklist
Creating a tenant screening checklist is a great way to ensure that your process for evaluating and selecting tenants is consistent.
With a checklist in place, you’ll know exactly what steps to take and when to take them when checking out a prospective tenant. That way, you never risk missing an important step that could let you know that a tenant is a poor choice.
But implementing a tenant checklist isn’t the only way to improve your screening process.
One of the best ways to ensure that you’re choosing the best possible tenants for your rental properties is to hire a property manager. A professional property management company will help to perfect your screening process.
They’ll cover the items on this list and more as they carefully screen every applicant for any potential red flags. From background checks and credit checks to interviews with prospective tenants, they’ll take care of every step of the screening process.
If you’re ready to invest in property management for your rental property or properties, we can help. Contact Reedy & Company today to learn more.