Regardless of whether you own one rental property or an entire apartment complex, the success of your real estate investment will depend heavily on your ability to be able to attract quality tenants who will stay for several years and pay their rent when it is due. Unfortunately, it can be particularly difficult to weed out the bad tenants from the good ones, especially if you have been managing rental properties very long. Here are a few tips that will help with screening tenants.
Run a Credit Check
The previous credit history of a tenant can provide you with a great deal of insight into how an individual deals with his or her debt obligations. Ultimately, you are looking for someone who has a solid track record of paying his or her bills on time each month, zero bankruptcies, and an appropriate amount of existing debt. There is some give and take here, but don't give too much that it will hurt you in the long run.
Draft a Standard Application
A standard and thorough application will aid you in the collection of the information that you need from a prospective tenant. Apart from the individual's name and basic contact information, you should request information about their employment history, previous rental history, and personal references. This information will help in making a well-informed decision regarding your choice of tenants.
Run a Background Check
There are numerous companies online that will offer thorough background checks for a nominal fee, and these checks include information regarding previous legal disputes, criminal records, etc. If the background check reveals numerous convictions on the tenant's record or that the tenant has been sued for failing to pay his or her bills, he or she likely is not a good candidate.
Hire a Property Manager
Performing all of these tasks and trying to find a quality tenant for your rental property can be very taxing. Luckily, it is possible to have someone else handle it all for you: a property manager. By hiring a professional to handle the tenant screening process for you, you will be able to increase the overall profitability of your rental investments while freeing up some of your time to focus on other aspects of your investments.
If you would like to learn more about how a property manager can benefit you with your rental properties, contact a local property management company today.