How far should management companies dig when evaluating tenants?
When you own property, you need to make sure you do everything you can to keep your income stable. You need to make sure you have quality tenants in your property at all times, and tenant screening is a great way to make sure this happens.
Criminal record
When selecting your tenants, you should look for the obvious. This includes a criminal background check. Check for things like violence, property abuse, substance abuse, and reckless behavior. If someone has a speeding ticket, that’s no reason to discourage them from owning it. You should only deter tenants who have pending violations that could pose a risk to your property or your other tenants.
late property payments
Another thing to look for is late payments on the property. You don’t want someone staying on your property to be unable to make the payments. Your property management company will be able to dig into this and see how far back the payments go. If a tenant has only missed one payment, then he has no reason to turn it down if all else is in order.
Ownership history and previous owners
Another thing to look into is the tenant’s history with other landlords. If you discover that the tenant has a history of hopping between properties at short intervals, he may want to avoid them. Tenants who jump between properties at regular intervals will hinder your profits, and it’s much better to have one long-term tenant rather than several who come and go all the time.
As you can see, these are the main things to focus on when digging into tenant history. Failure to do so could leave you with a troublesome tenant, who regularly disrupts your earnings and ownership. Only assess the tenant for things that would hinder their investment. Refusing a tenant on the basis of something that is irrelevant, like a shoplifting charge when he was young, would not be practical for his investment. The criminal offense has nothing to do with his reliability as a tenant, especially if it was committed a long time ago.