Landlords who are able to attract and place a high quality tenant will have an easier and more profitable investment experience. Good tenants take care of your property. They pay rent on time and follow the terms of the lease agreement. They communicate openly and they are easy to work with.
If you don’t screen prospective tenants carefully, you could end up with an eviction, property damage, and a lot of stress and lost income.
At OmniKey Realty, we hold our tenants accountable and we establish positive, respectful relationships with our renters before they even move in. This is easy because we spend a lot of time screening carefully, so we know we’re getting some of the best tenants in Dallas.
Here are some of the things to keep in mind as you’re putting together your own screening process.
Document Your Rental Criteria – and Stick to It
While rigorous tenant screening is important, following all the federal, state, and local fair housing guidelines and laws is also important. Protect yourself with good documentation. Establish a screening process and use it consistently to evaluate every tenant. Create rental and put it in writing. You’ll want to share that criteria with any potential applicants who visit your home and express an interest in applying.
With a set of standard rental criteria that’s used to screen every application, tenants will know what you’re looking for, and what will be required in order to be approved for the property. It’s your best defense against any claims of discrimination or fair housing violations.
Criminal and Credit Checks
Conduct a nationwide criminal background check, and pull up eviction records as well. Those don’t always show up on a credit report.
Credit scores are good to have but don’t get hyper-focused on just the number. The type of debt an applicant has is often more important than the amount of debt. People fall behind on student loans and medical payments, and the COVID pandemic has perhaps had an impact on debt payments. That doesn’t mean they’re risky tenants. Look at how financially responsible the applicants are overall. If there are debts owed to former landlords, utility companies, management companies, or apartment buildings, you’ll want to think twice.
Evaluate Income and Ask for Proof
It’s essential that your tenants can afford to pay the rent every month. Approving a tenant who doesn’t earn enough money to meet their obligations will only set them up for failure. The standard best practice in Dallas property management is to look for income that’s at least three times the monthly rent. Ask for verification in the form of pay stubs, tax forms, or bank statements.
You can ask for employment references as well. By contacting an applicant’s employer, you can verify that they work there and make sure the dates and position titles on the application match up.
Verify Rental History
Talk to current and former landlords because they tell you a lot about what it was like to rent to the tenant you’re considering. Send them an email or make a phone call. It won’t take more than a few minutes, and it will give you some very valuable information.
A former landlord can tell you how a tenant paid, took care of the property, and communicated. Always ask for contact information, and do a little research to make sure you’re actually talking to former landlords or property managers. Tenants with a terrible rental history may try to give you contact information for friends or family members.
This brief guide will get you started on your tenant screening process. If you’d like some help finding the right resident or you have questions about Dallas property management, please contact us at OmniKey Realty.