Craig Tice has been Chief Operating Officer of LB Property Management, based in Sherman Oaks, CA and operating in both California and Arizona, since 1996. He knows that getting the right tenants is vital to maximizing the potential of your property or properties, and that a decent screening process is the first step. Here, he talks about what that screening process can entail.
It’s very important to screen potential tenants, especially in today’s market. That’s because things are becoming more competitive, with rents going down, move-in packages becoming aggressive, concessions growing more prevalent, and the cost of moving dramatically dropping. With all of these things in mind, the screening process becomes even more important when looking for a new tenant.
When a person today only needs a few hundred dollars to move into an apartment that rents for $1,200 to $1,500 a month, if he is not properly screened beforehand, then you are going to end up with an eviction and skips - which is obviously not what you want. By contrast, a market that can demand larger security deposits and a much higher cost of moving is less likely to produce situations where tenants are unreliable.
Credit Checks
It’s obviously important, therefore, to run a credit check and background check on any potential tenant to see if he has any eviction notices or negative judgments on file. It’s also important to review his rental history and confirm that information. You can do this by calling and speaking with former landlords and confirming that the addresses the tenant listed on his application are correct. You can also take the step of obtaining a report from one of the major credit agencies.
We have had times when we have actually visited the former apartment building at which the prospective tenant rented. It’s not always practical, but it certainly helps formulate an idea of how the tenant was living and intends to live. We have had resident managers that will visit a current residence to confirm that an applicant is actually a tenant in that unit, and also to speak directly to the manager about the type of tenant the person is.
Verifying Employment and Income
It’s also crucially important to verify the employment and income of any potential tenant. In doing so, it’s vital that you not just rely on the information given to you, but also on independent confirmation. For example, instead of calling the phone number your applicant lists as that of his employer, get the human resources department’s phone number for that company and make sure you know who you are talking to. This is a much better approach than just calling the name of the person listed on the application.
Often times, a prospect will list a co-worker rather than his actual supervisor when he is no longer employed, or soon to be made unemployed. You can catch this type of discrepancy by checking properly on the information given.
All in all, the key is to do your homework if you’re looking to wind up with a tenant who is reliable and non-problematic.
