The potential tenant seems very likable. Like a nice and respectable working guy who will not give any landlord like yourself problems. You’d be happy to lease to him, right…?
However, don’t we all put our best foot forward when trying to give a good impression? Tenant screening takes more than a one-on-one with your applicant. It needs a more tedious yet practical approach that will benefit you in the long run.
The Value of Reference Checks
Doing tenant background checks, or hiring companies that offer the service, is one legal way to learn more about your tenant, done within ethical limits. Do choose a reputable background check company to make sure you are getting your money’s worth.
Still, background check reports don’t include information like a penchant for loud parties, often-delayed payments or disregard of tenant rules and regulations. Therefore, a reference check should always be in order whenever one applies for lease. It is very good practice to ask for a list of references. Why? Because they may be able to give you more information that you otherwise won’t find in the reports.
The Right References
Let the applicant know the specific references you need. The list should include contact details of his employer, or former employer should he happen to claim to be new at his job, and a former landlord. Tell him that a friend will not be accepted as a valid reference. A friend, in all likelihood, will give you a glowing picture of the applicant. You need facts, not a biased view.
How the applicant has/had been an employee is not a matter you should be privy to. Simply confirm employment details such as period of employment, job title and final salary. Many companies do implement a No-Comment policy so some give period of employment and nothing else. At least, you are able to confirm employment and, hopefully, position, so you can assess his ability to afford the lease and pay regularly. If his employment history does not show him drifting from one job to another, it won’t affect his ability to pay in the future.
Who best to talk about someone as a tenant, though, than his former landlord? Tenancy period should be easy to confirm then, but there are more factors that should affect your decision to accept or reject application. The landlord should have leased to him for a considerable amount of time, enough to talk about how he was as a tenant – Did he pay rent regularly, get along with his neighbors, keep the premises in good condition? Had he conducted any criminal or prohibited acts while there? These are information that any landlord should know.
Not all references have the time to receive your call, though. So an alternative is to let the tenant know what you would like to find out from his references who will then fashion letters based on the information you need. Have these sent to you via regular mail or email. You can still contact the references simply to confirm if they have indeed written them.
Validating References
To make sure you are talking to the right person on the phone, this is where a little background check on the employer or landlord is needed. It should be nothing that would be considered as unethical and an invasion of privacy. Make the candidate aware of this plan ahead of time.
Find out if an actual company exists, owns the correct phone numbers, and has a real person bearing the suggested reference’s name working for the company. Get a directory or Google the company, the address, the phone number, even the reference person. Do this as well when checking on the former landlord. If you are updated, then you know that many landlords also now use social media and chances are, you will find the former landlord or their home-provider business online. Visit the areas, if you must.
Let the tenant know as well that you need references who have already agreed to talk about him. This can help avoid awkward moments of trying to get information and them dodging your questions, which should make you wary of their validity, too. Employers and landlords are under no obligation to speak to you, but if they have agreed to be references, they should keep their promise.
Ask the former landlord for a chance to visit to see the place yourself and so you can talk landlord-to-landlord. This is recommended especially if he makes any claim of non-payments or criminal activities and such.
The Facts of the Matter
Reference checking also involves making sure that all information disseminated to you are correct. You can ask for copies of any legal documentation that supports the landlord’s claim. This will prove that the former landlord is giving negative feedback based on facts rather than out of a personal, biased grudge. Also, you can show the tenant candidate the files should he ask why you are rejecting his application. Using documented facts will save you from any accusations of prejudice.
When tenant screening, giving someone the benefit of the doubt is not always a good thing. For a well-informed decision, you need to get the facts straight from valid sources, for your business and other tenants’ sake.