I’m sure many of you have been in the position where you have rented a space to someone thinking they seem like they are going to be great tenant(s) with little issues but you were sadly mistaken. Qualifying a tenant can be very difficult and challenging. You don’t want the property sitting vacant for to long but on the other hand you want someone who is going to pay their rent in a timely manner without causing you too much grey hairs along the way. In my experience of course you want to get someone in your vacant space as quickly as possible but even more so you want that person(s) to last a significant amount of time because as we all know the turn over costs could be painful if it doesn’t work out. For example if that person(s) only lasts two months and lets say you collected $1600 of rent in that time but now they destroyed you house causing you to file an eviction, not getting rent until that goes through, then on top of that once you finally get rid of them you have to change carpets, getting rid of excess amounts of trash etc. This mistake can be very costly and often you lose more than you gain.
Here are the ways I qualify my tenants and ever since I started this strategy I’ve seen a significant decrease in my turnovers and found that I get more quality tenants who stay a lot longer. I use a program called APPFOLIO, it has honestly been a life saver. I will do a blog solely on this program but in a nut shell here is what you can do, have your potential tenants simply apply on this site it screens their criminal background, credit history, rental history, employment etc, this information is key in choosing a good tenant. On top of this I always request them to show my proof of rental payments from where they are living now. If they can do this I’ve found that you will get a much better tenant because chances are if they’ve paid rent to their past landlord they will pay it to you. When people tell me they can’t prove anything and paid cash I usually run the other way. Of course there are always some exceptions, if everything else checked out ok in their background search then I will usually request a strong co-signer in addition. Generally the minimum requirements I use is 1 year of employment and rental history to qualify. Combining all these factors together you are surely to get a more qualified tenant.
Written by Scott Esmail