REAL ESTATE QUESTION- Tenant Screening

 

Question from one of Matt’s readers-

“How should I screen tenants?”

Matt’s Answer-

That is a great question and more important today than ever. As the foreclosure wave pushes more and more people out of their production homes and into the rental market, landlording is seeing a rebirth. Once again, it is not so bad to hold rental properties. Generally, the number of vacancies is dropping. And, more and more investors are moving away from the more creative real estate investing techniques and back to buying and holding rental properties.

 

Landlording is back!  (I never thought it went away, actually.)

 

For both the seasoned landlord and the newest of real estate investors, it is important to screen tenants and have a command of the tenant screening process. There are a number of factors to consider, such as:

· What forms do I use?

· Do I require an application fee?

· How do I screen?

· What is my screening criteria? What makes a good tenant?

· How do I avoid discrimination claims? What are my duties and rights?

· How do my rental application and lease agreement work together?

· Was does it really mean to “pre-screen” tenants?

· Should I use a tenant screening service?

These are great questions, and the answers are relatively simple. It does, however, take some time to learn about your rights, responsibilities and opportunities, as they relate to tenant screening. I cannot address all these topics here, but let me take the last question- “Should I use a tenant screening service?”

The answer is: Yes, you better. Using tenant screening services is the most cost- and time-effective way to improve your chances of a successful landlord-tenant relationship. Good tenant screening services are a bargain. I have written for more than a decade on the subject, and believe in them more today than ever.

Do “bad” tenants slip through, even with a tenant screening company helping you? Yes, it happens. But, for the most part, professional tenant screening greatly improves your odds of finding the best tenant in your pool of tenant applicants. I believe in tenant screening services so much that I agreed to teach a class on landlording, called “Landlording 101,” for the local office of the National Tenant Network, last year. WE WILL PROBABLY OFFER THE CLASS AGAIN THIS SPRING!  IF YOU ARE INTERESTED IN ATTENDING, EMAIL ME.

 

Also, once each month, I host the “Landlording Subgroup” of the CENTRAL INDIANA REAL ESTATE INVESTORS ASSOCIATION.  The next meeting will be held in my law office building- 151 N. Delaware Street, downtown Indianapolis at 6:00 p.m. on March 23.  If you’re a CIREIA member, register to attend the meeting at www.cireia.org.

 

At these classes, I answer the questions listed above. If you are a landlord and have not attended one of my classes, please do so soon.  If you haven’t established a relationship with National Tenant Network or another such service, do so this week. That is one of the first and certainly most important steps in the tenant screening process.

2 thoughts on “REAL ESTATE QUESTION- Tenant Screening

  1. MY BLOG IS ABOUT SHARING NEW BUSINESS IDEAS, CONNECTING PEOPLE TO CREATE NEW OPPORTUNITIES AND EXPLORING THE INTERPLAY BETWEEN BUSINESS AND THE LAW. THIS IS NO PLACE FOR SPAMMERS.

    IF YOU HAVE SOMETHING CONSTRUCTIVE TO ADD TO MY BLOG, I DON’T MIND YOU MENTIONING YOUR OWN SITE. JUST DON’T SPAM HERE.

    SOMEONE WROTE: “Many people looking for rent are concerned on what will show up on their credit report and eviction search. In many cases these applicants want to check out themselves first before completing an application incase there is any negative or false information on their tenant screening reports.”

    I DELETED THE REST, BECAUSE IT WAS SPAM.

  2. Running a credit check on a person is not an easy task specially in some states like Massachusetts. When you pull somebody’s credit report you have to take every possible to move keep that data in a safe spot. You could face legal action for the loss of such data.
    For doing such kind of screening people should take the help of a professional organizations.

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