As a landlord, one of the biggest mistakes you can make is not being careful enough about who you rent your properties out to. When you take on a new tenant, you're tacitly trusting them with a very valuable asset. If they don't take proper care of it, this could have catastrophic consequences—and that's only one way a tenant could end up damaging your business.
For these reasons, it's important you choose tenants that are responsible and conscientious. No matter how good a judge of character you are, you'll still need to carry out a tenant background check to ensure this is the case.
Luckily, tenant background checks are relatively easy to conduct. This guide will show you how. Read on to learn more.
Ask Them for References
One of the key points of any tenant background check will involve speaking with references your potential tenant has provided you with. You can also ask for written references, however, these can be easier to fake, so getting the name and number of someone to speak with is always the preferable option.
You can ask for several different types of references, depending on how thorough you want to be. You'll definitely want to speak with at least one former landlord of theirs, to verify how they are as a tenant. In many cases, landlords will request two references from former properties.
You might also want to seek professional references. This will allow you to see both how responsible they are and also how stable their job situation is. Having a steady and reliable income is, of course, a big plus.
Look Into Their Background
As well as speaking with bosses and former landlords, you should also look into other areas of their background.
For example, have they ever been arrested? Have they filed for bankruptcy before? You can also perform a full credit check on your tenant, if you feel this is necessary, however, in some cases you will need their permission for this.
As well as this, you should request a copy of their ID and social security number. This will allow you to verify they are who they say they are and the information they have given you is correct. Without this step, you cannot be sure that identity theft has not been committed.
You should also request information about their history as a tenant. How many different homes have they lived in, and for how long? If they're changing every couple of months, this might not be a tenant you want to take on.
A Comprehensive Tenant Background Check
The above covers the most common components of a tenant background check. You may want to seek more details, depending on how exhaustive you would like to be. However, with all of the above information, you should be able to get a good picture of what a person would be like as a tenant.
This might seem like a lot of work, especially with multiple properties to fill and keep track of, but it is a necessary part of being a landlord. If you'd like help with this or any other property-related duties, why not give us a call today?