Has your property ever stayed vacant for a prolonged period of time? Have you ever had to compromise on the type of tenant you lease to just to earn rental income?
If you have found yourself in such situations then you could relate to how this potentially posed additional risks to you as a landlord. Not finding a suitable tenant can create conflicts, some being the withholding of rent payments, and lease-breaking prior to termination. In order to benefit both parties, such disputes can be avoided and precious time can be saved while screening tenants, by having a reliable filtering mechanism in place to narrow down the most suitable candidates.
Below we will provide an an insight into this process.
Step 1: Set your minimum requirements
During the pre-screening and in-depth screening phases, landlords can set their minimum requirements to be used to filter potential tenants. Evidence of these requirements should be requested, where possible.
Here are a few examples of requirements:
▪ Level of monthly income (i.e. > 3x monthly rent)
▪ Stability of income (i.e. Part-time / full-time, government employee, etc.)
▪ References from past landlords
▪ References from employers
▪ References from family/friends
▪ Check whether any previous landlords have evicted the tenant and the reason/s why
▪ Criminal/sex offender history
Tenant’s Credit Score
▪ Shows willingness and ability to pay bills/debts
▪ Shows level of financial responsibility
▪ Pets allowed or not
▪ Number of tenants to live in the property
Step 2: Pre-screening through advertising
Once the minimum requirements are set, the initial filtering process starts from the advertisement post of your property. The landlord should clearly indicate their requirements on the post in order to narrow down the number of calls/interests from potential tenants. As a result, the landlord will save valuable time from taking calls or arranging viewings that do not fall within their criteria.
Step 3: Pre-screening through first contact
After advertising the property, the landlord will start receiving calls from potential tenants. During this first contact, the landlord will have an opportunity to further narrow down candidates who fall under his/her set of requirements. Allowing potential candidates the space to talk to the landlord and in turn, listen to the tenant carefully will provide the landlord with a better understanding of the candidate’s background. Keep in mind that being prepared to answer any questions the candidate may have is paramount.
Step 4: Pre-screening in Person
Once you have selected your most suitable candidates you can then pre-screen the tenant in person before completing any paperwork. What you should consider during this process are as follows.
Are they on time?
• Being late may indicate a lack of interest in the property
How is their conduct?
• Are they respectful?
• Are they polite?
Is eye contact established?
•This may indicate if the candidate is honest
Who accompanies them?
•Indication of who might live with the candidate
Once the pre-screening phase has ended, the screening through paperwork begins. At this phase, the landlord requests a set of documents to confirm the ability of the candidate to pay the rent and to keep the property in a good state throughout the tenancy. This process can take days or even weeks to complete. However, when it is outsourced, it can shorten the completion time.
Although the concept is relatively simple, there are still landlords who do not apply it. Having a set of mechanisms to filter potential candidates can help your tenant on-boarding process become more efficient, therefore saving you precious time. So start thinking….what are your requirements?