Most rental property owners have an issue placing bad tenants. Generally speaking, it is because they don’t have the tools or resources to screen tenants effectively. Consequently, placing a bad tenant can be very detrimental to their rental property business. In this article, I am going to discuss 5 tips to avoid placing a bad tenant.
Tenant Screening – Tenant screening can mean many things to many people and for some, it means just filling out an application. For me, Tenant screening means using a best in class state of the art system to process a tenant's personal, economic, & credit worthiness details even down to the pets. There are many systems on the market that can help you perform effective tenant screening.
Meet the Tenant in Person – One low tech approach is meeting the tenant in person. This will help you evaluate the tenant face to face. This will allow you to perform a car inspection to see how they keep their car. Chances are the way they keep their car is how they will keep your unit.
Validate References – It is good to ask for references. It is useless if you don’t validate those references. I once had a prospect add his family members as references. While I appreciated the effort, I could not accept those references.
Validate Employment Income – I once had a prospect tell me that he made $25,000 a month from Google. This confused me because he had outstanding debt that was much less than that amount. Always independently validate income.
Contact Current and Former Landlord – Contacting current and former landlords of a tenant will always be the most illuminating aspect to avoid placing bad tenants. When you reach out to a landlord and they tell you all good things about a tenant, you are almost certain to have a successful tenancy with that tenant.
If you follow these five tips, you will avoid placing bad tenants which will ensure that your bottom line is in the black. Ignore these tips at your own peril and suffer the consequences of late payments, destroyed properties and evictions.
