Choosing the right tenant can be challenging and the consequences of getting a bad one are can be very costly to a landlord. Over the years, Certified Property Solutions has developed an effective way to help screen tenants which helps reduce the chances that a property owner like you has in selecting the wrong tenant.
Here I will share with you different techniques which will help property owners and landlords make informed decisions before selecting their next tenant.
What Should I Look For?
- National Criminal Background Check
- Credit History
- Eviction History
- Verify Identity
- Contact Past Landlords
National Criminal Background Check: This will help identify potentially unwanted behavior or attention. In the past, Certified Property Solutions has seen landlords rent their property to a tenant who later on turned out to be involved in criminal activity. Not only does this place them at risk of retaliation or property damage, but it could also cause problems for future tenants down the line. I have managed properties before where I get reports from tenants that strange people come around at odd hours knocking on their door or driving by and staring at the house. This can be very unnerving to a tenant and their families. Being that Hawaii is known for people to move to and from Oahu, it’s important to perform a national criminal background check.
While a prospective tenant may not have committed a crime in Hawaii, that doesn't mean they don’t have skeletons in other states.
Credit History: Reviewing a tenant’s credit history and score is one of the most common methods used to screen tenants. However, I believe that the information is somewhat subjective and it circumstantial. For example, someone’s credit report may have a low score due to outstanding medical bills or foreclosure. There may be valid reasons why the prospective tenant was unable to pay their debts. For instance, most people don’t plan on getting hurt or sick and it doesn't take much to accumulate thousands if not hundreds of thousands of dollars in medical debt, even with insurance. Conversely, there are usually reasons why someone let their property go into foreclosure and there could be a sufficient explanation such as a death in the family, reduced income, or even divorce.
When it comes to credit history, it’s important to take into consideration that you may find yourself in an unexpected situation where your credit was negatively affected. You wouldn't want someone to decline you solely based of your credit score especially if there were valid reasons. Be sure to review the report but also ask questions if there could be a valid reason behind a negative remark.
Eviction History: Lets face it, no landlord wants to have to evict a tenant. Having gone through the eviction process in Hawaii before, Certified Property Solutions knows that it is both costly and time consuming. We have also learned that people are creatures of habit and similar to credit, there may be a valid reason why someone was unable to pay their rent, the tenant should have been able to work something out with the landlord before it required a formal eviction. For instance, the tenant could have contacted the landlord in advance to turn over the keys and move-out peacefully.
Verify Identity: It’s no secret that identity theft is becoming more common and with modern technology, it is fairly easy for someone to alter documents to make them look real especially to the untrained eye. While it may be simple to spot a fake Hawaii driver’s license, Could you tell whether or not a driver’s license from New York was real or fake? I know I couldn’t. With proper background screening, you are able to reduce the risk of identity theft by connecting the dots and aligning key elements such as birth dates, social security numbers, previous residences, etc. While it may be simple to generate a fake ID, its not as easy to create a fake person as people leave bread crumbs throughout their life. By picking up those bread crumbs, you are better able to identify their identity.
Contact Past Landlords: In my opinion, this is the most important form of tenant screening; assuming the prospective tenant has legitimate rental history. Ultimately, a landlord is concerned about 2 things, getting paid on time and making sure their property is being taken care of. A quick review of someone’s rental history can tell you just that. There are tenants out there who may struggle with paying their credit card bills on time, but at the end of the day they still make it a point to pay their rent and take care of where they live. While this doesn't supersede bad credit by any means, it can prove a useful tool when making a decision if an applicant has questionable credit.
There is always a possibility that someone could fake references, however do consider that if someone is lying about their rental history, it’s also likely that other red flags will exist in their credit history.
Certified Property Solutions specializes in screening tenants. Whether you are looking for someone to help screen prospective tenants or a full time property manager in Hawaii, we have a program that will work you. Contact us today to learn about our tenant screening services in Honolulu and on Oahu.
September 16, 2014