Understanding the Importance of Screening
Source: Property Management for Dummies
By Robert Griswold
If you
are like many rental property owners, you may be thinking; “Screening?
Isn’t that a waste of time? After all, I trust my gut instinct when I
meet people, I know which ones are good and which are just trouble.”
Although it does take time to verify all the information on your
prospective tenant’s rental application, it is time well spent.
Relying on your instincts is a very inaccurate, arbitrary, and above
all, illegal.
In order to increase
your chance of finding a long-term, stable tenant, and in order to
avoid charges of discrimination, your tenant selection criteria and
screening process should be clear, systematic, and objective. Put
it in writing to ensure that the process is applied consistently and
fairly to all rental applicants.
Setting up a
systematic screening process is particularly critical if you only own a
single rental or a small multi-unit rental property. Professional
dead-beat tenants (people who go from property to property damaging
units or not paying rent) are experienced and shrewd. They know that
the large, professionally managed rental properties have detailed and
thorough screening procedures that attempt to verify every single item
on their rental application. If certain items do not check out,
the professional property manager does not just trust her feelings on
the prospective tenant. The professional deadbeat tenants, who
always have something to hide, know that small rental property owners are easier targets, because the novice property owner is more likely to bend the rules than the professional.
Sometimes the mere
mention of the tenant screening process is enough to make the rental
prospect fidget and then shift into the classic “I’m just looking”
mode. Do not rush or allow a prospect to hurry you through the
tenant screening and selection process. The wrong decision can be
financial devastating, particularly if you have just a couple of rental
units with monthly debt payments.
Establishing solid
tenant-selection criteria and performing a thorough tenant screening
process does not guarantee a good tenant, but it does significantly
improve your odds.