The ideal tenant pays their rent, doesn't violate the lease, and takes care of their rental unit. This is the type of tenant you want, but do you have trouble finding these tenants?
Well, look no further. There's an effective way to do this.
The solution: create strong tenant screening criteria.
Keep reading to learn how to do this to find the best tenants around.
The Purpose of Creating Tenant Screening Criteria
Creating strong tenant screening criteria helps you in several ways, including the following:
You Find Better Tenants
When you determine beforehand what types of tenants you want, you'll find better ones. This is the primary reason for creating tenant screening criteria.
You decide what qualities tenants should have. Then, you find tenants that meet that criteria.
Simplify Your Work
Great tenants pay rent. As a result, finding better tenants simplifies your rental accounting records.
Good tenants also cause fewer disturbances. They protect and care for their units. They make your job easier.
Additionally, you'll file fewer evictions on good tenants.
Setting criteria also protects you from discrimination cases. You'll face fewer lawsuits if you can prove that you choose tenants by specific criteria.
What to Include
What do effective screening criteria include? Here are the primary things:
A person's credit score tells a lot about the person. The primary thing it reveals is how well they manage money.
Having a good credit score takes work. It requires paying bills on time and avoiding too much debt.
Therefore, include a credit score requirement in your criteria. With this, you'll find high-quality tenants.
Next, add criteria for a person's income level and employment status. For example, set a requirement that a person's income is five times the monthly rental rate.
Past Rental Experience
Adding a clause about a person's past rental experience is also helpful. For example, you might require that a tenant has a clean history. In other words, no evictions on their record.
How to Use This Information
You must apply the criteria after creating a system. Begin by analyzing the applications you receive. Eliminate those that don't qualify, and save those that do.
Next, perform tenant interviews. Design a list of questions to ask each applicant to learn more about them. For example, ask how many rentals they've lived in during the past five years.
Finally, negotiate with the tenant. Around 59.6% of leases last 12 months. Therefore, 12 months is the most common option.
However, ask if they're willing to sign a longer one. You could agree to a lower rental amount if they do. This option is highly worthwhile if you find the ideal tenant.
Seek Help for Tenant Screenings
PMI Alliance is your solution. We're a property management firm operating in the Dallas/Fort Worth Area with local experience.
Our firm can help you create strong tenant screening criteria, but we won't stop there. We'll also help you perform the screenings to choose the best tenants available.
Would you like more information? Reach out to us today!