Landlording & Rental Properties

Tenant Screening: What Criteria Can You Use?

Expertise: Landlording & Rental Properties, Real Estate Investing Basics, Flipping Houses, Business Management, Personal Development, Mortgages & Creative Financing, Real Estate News & Commentary
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My previous two articles discussed the importance of tenant screening and how to avoid a federal discrimination suit.  In this article I want to discuss some of the criteria that you can and should be using to screen your potential tenants.

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As mentioned in my previous articles, you must treat all applicants equally.  Further, you cannot discriminate against the seven federally protected classes.  But you have to have some method of choosing the best tenant for your property.  You have to discriminate, or choose, in some form or fashion.  So what should a smart landlord be looking for?

Here are my Top 7 Criteria for Selecting Tenants

  • Can they prove who they say they are with proper ID, SSN#, etc?
  • Do they have a job and/or enough income so they afford the rent and utilities?
  • Do they have job stability, a good work history and good job references?
  • How is their credit?  Do they pay their bills?  Do they pay on time?  Have they ever filed for bankruptcy?
  • Can they provide good references from previous landlords?  Have they ever been evicted?
  • Do they have a criminal background?
  • How many people will be living in the property?  HUD has guidelines about how many people to allow per room, usually it is 2 people per bedroom.

The above are criteria that you should at a minimum be looking at as you screen your tenants.  You want to know if they can they pay the rent, will they pay the rent and will they cause any trouble.

Of course there are other criteria that you may want to consider as well.  Many of these are based upon experience or preference. Remember also that the tenant screening process begins at the first point of contact with the prospective tenant.

  • Were they rude or abrupt, or were they respectful and well mannered?
  • Were they clean and well put together or was their car full of trash and junk?
  • Do they have any pets?  Pets are not a protected class (assistance pets for the disabled are the exception).
  • Do they smoke?  Smokers are not a protected class, you can discriminate against them and some landlords do because of the added expense of cleaning up their properties when a smoker moves out.
  • Do they own a motorcycle?  Guess where that motorcycle may end up in the winter?  Likely in your dining room dripping oil on the floor.
  • Some landlords will not rent to lawyers.  Lawyers are not a protected class.  Lawyers are known for suing people, even their landlord.  Just tell one you will not rent to them because they are a lawyer and see what they say next.
  • No job category is a protected class.  I know of landlords who do not rent to police or preachers for example. It may seem harsh, but they do not want to try and evict a cop and would hate to evict a preacher.

The point is that almost anything except for the seven federally protected classes is pretty much fair game for you to use in screening your tenants.  And that is what is so great about real estate investing; there are thousands of ways to do it and no “right way.”  What works for you may not work for someone else.

Like I said before, at a minimum you want to ensure that the prospective tenant can afford the property, will pay on time, will not cause trouble and will not destroy the place.  Whatever standards you choose to use to determine this, write them down and apply then consistently during the application process.

I will talk more about the application process next time.

Photo: Aric McKeown

Kevin Perk is co-founder of Kevron Properties, LLC with his wife Terron and has been involved in real estate investing for 10 years. Kevin invests in ...
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    Geoff
    Replied over 7 years ago
    I can’t believe you posted a picture of my car on here LOL 🙂 Sad but I have seen a car like this, and the person that owns the car live in (owns, not rent) a 3 bedroom house, that looks exactly the same.
    Eric Worral Investor from Buffalo, New York
    Replied almost 3 years ago
    I didn’t see the picture myself but saw the credit to the link on flickr. Found the caption pretty funny in that the car had a club on it. I’ve heard from several landlords that they try and walk the applicant back out to their car to see what shape they keep it in. I’ve have another landlord tell me that they keep tabs on their shoes. If they have muddy beaten up shoes it says something compared to having clean sneakers. I know I did a showing for one of my rentals and the applicant took their shoes off before coming into the apartment. I didn’t hand them a lease on the spot but it definitely stood out to me as unusual and the act of someone who is very conscientious of their surroundings and other people’s things.
    Kevin Perk
    Replied over 7 years ago
    Geoff, I have seen cars like that as well. Some do pull up when we do showings and the “oh hell no” thought goes through my head. Thanks for reading and commenting, Kevin
    Sharon Vornholt
    Replied over 7 years ago
    Kevin – Don’t foget to check the free sex offender registry. You will have a real problem on your hands with that one.I started checking when I had a potential tenant volunteer the information. On my application it asked if they had ever been convicted of a felony. This man said he was a convicted sex offender and asked it that counted.
    Kevin Perk
    Replied over 7 years ago
    Good point Sharon, That will usually come up on the criminal background report. Kevin
    Melisa
    Replied over 7 years ago
    I am glad you posted this as I am in the process of finding a tenant for one of my empty units in my duplex. I can tell you right now I hate the process, I hate thinking about it, etc. I am trying to find a property management company to screen applicants, I am getting too many calls (which I am not complaining about) I just have not found the time to call folks back (it’s really busy for me right now). This article has help put the minimum requirements I should be looking at in to prospective. I have many other properties but I’ve never had to find a tenant (wish me luck)- I feel like a need a step by step guide, lol.
    Kevin Perk
    Replied over 7 years ago
    Melisa, It can be hard with all of the rules to trip over out there. Just remember to be fair and consistent. You want someone who can afford the rent, will pay the rent and will not cause problems or unnecessary damage. Write your criteria down to reflect those characteristics and follow them. My next article will deal with how we put all of the material of my previous articles on screening together in the application process. Watch for it next week. Thanks for reading and commenting, Kevin
    Jim M.
    Replied over 7 years ago
    Good, informative series of artticles. Thank you.
    Kevin Perk
    Replied over 7 years ago
    Thank you Jim, I appreciate the kind words. Kevin
    Karen Rittenhouse
    Replied over 7 years ago
    Point is, screen your tenants. I’m amazed by the number of landlords who don’t bother. The screening process is necessary, the most important process a landlord does and can end up saving time, money, and frustration. I know it’s hard to turn away a live body standing in front of you with cash, but it may be the best landlording decision you can make. Screen your prospects. We have a right to know who this person is before we hand over our keys. We are, after all, turning over to them a very expensive piece of real estate. Thanks for your post.
    Kevin Perk
    Replied over 7 years ago
    Thank you Karen for reading and commenting. Screening is so important. It really does save money and headaches! That is why I have spent so much time on it here lately and I’m still not done. More coming next week. Kevin
    Bryan Jaskolka
    Replied over 7 years ago
    Screen, screen, and then screen again, I agree. Too many landlords give their tenants the benefit of the doubt (especailly at first when you don’t even know them!!) only to find that they have real trouble a month into the agreement. Thanks for the post. So many say to “check, check, check” but then don’t tell you what you’re checking for. Thanks for being clear!
    Bryan Jaskolka
    Replied over 7 years ago
    Screen, screen, and then screen again, I agree. Too many landlords give their tenants the benefit of the doubt (especailly at first when you don’t even know them!!) only to find that they have real trouble a month into the agreement. Thanks for the post. So many say to “check, check, check” but then don’t tell you what you’re checking for. Thanks for being clear!
    Bryan Jaskolka
    Replied over 7 years ago
    Screen, screen, and then screen again, I agree. Too many landlords give their tenants the benefit of the doubt (especailly at first when you don’t even know them!!) only to find that they have real trouble a month into the agreement. Thanks for the post. So many say to “check, check, check” but then don’t tell you what you’re checking for. Thanks for being clear!
    Kevin Perk
    Replied over 7 years ago
    Bryan, Trust but verify right? Because prospective tenants never, ever lie 🙂 Thanks for reading and commenting, Kevin
    Dale Osborn
    Replied over 7 years ago
    If they do not meet your minimum criteria – move on to the next applicant and screen them. It is better to leave a unit empty than to put the wrong person in there. There will be damages and court costs to evict them on top of the lost rents. Screen to the max should be the mantra of every landlord.
    Kevin Perk
    Replied over 7 years ago
    Good advice Dale! It is often better to leave the unit empty for a while. But I know it can be hard when someone has the money and is ready to move in. Trust me, the money you make on the front end with a tenant that you do not screen well will be lost on the back end when the eventually leave. You will either have to evict them or they will trash the place. Either way you lose time and money. Thanks for reading and commenting Dale, Kevin
    Dale Osborn
    Replied over 7 years ago
    If they do not meet your minimum criteria – move on to the next applicant and screen them. It is better to leave a unit empty than to put the wrong person in there. There will be damages and court costs to evict them on top of the lost rents. Screen to the max should be the mantra of every landlord. Reply Report comment
    Rob
    Replied about 7 years ago
    I recently had a woman look at a house to rent. She had a job, references, etc. Everything seemed ok, except her two year old son was running all over the house with her keys and trying to shove them into every electrical outlet. I told this woman that her son was about to get zapped, but she didn’t seem to care. I rejected her because I thought this unsurpveised child would destroy my house or injure himself. I hate to think what happens at bathtime. He’s probably on his own in a tub full of water. Reply Report comment
    Rob
    Replied about 7 years ago
    I recently had a woman look at a house to rent. She had a job, references, etc. Everything seemed ok, except her two year old son was running all over the house with her keys and trying to shove them into every electrical outlet. I told this woman that her son was about to get zapped, but she didn’t seem to care. I rejected her because I thought this unsurpveised child would destroy my house or injure himself. I hate to think what happens at bathtime. He’s probably on his own in a tub full of water.
    Eric Worral Investor from Buffalo, New York
    Replied almost 3 years ago
    Regardless of your thoughts on the child or the parenting… familial status is one of the seven protected classes. You shouldn’t take it into account when screening tenant applicants.
    Danny Pickrell
    Replied almost 7 years ago
    Great post. Tenant screening is one of the most important things you can do when renting out. Often the truth comes out with just a little bit of digging, and can save you a headache in the future. Thanks for sharing this.
    Kevin Perk
    Replied almost 7 years ago
    Danny, You speak the truth. Screening has saved us many a headache. It is an essential part of being a landlord. Thank you for the reading and the kind words. Kevin
    Nichole
    Replied over 6 years ago
    How important are references these days? It seems like anyone can get a reference.
    Nichole
    Replied over 6 years ago
    How important are references these days? It seems like anyone can get a reference.
    Kevin Perk
    Replied over 6 years ago
    Nichole, They are important. But you need to use them carefully. For example, if their mom is giving a reference it is probably not the most accurate one. However, if an employer, former employer or former landlord is giving a reference, those can be great. Here is a tip however with these. Do not call the number listed on the reference. If for example the reference is a former employer, call the main number and ask to be connected to that person when checking the reference. That way you can bypass a potential “friend” sitting in on the reference and get the real story. As with anything though, references are only part of the story. Be sure to pull credit and criminal histories and check their income and work histories as well. Thanks for reading and commenting, Kevin
    Breanna
    Replied almost 6 years ago
    Thank you so much for this article! It greatly helped with my Real Estate Law class!
    Kevin Perk
    Replied almost 6 years ago
    Breanna, Thank you! Hope it was not a class on how to sue a landlord. 🙂 Kevin
    Eric
    Replied almost 6 years ago
    I use income and credit score almost exclusively. Find a 620+ credit score, without any collection accounts, and you are golden, mostly. I prefer 650+ though. income will tell you the tenants ability to pay rent, credit score will tell you the tenants desire to pay rent.
    Kevin Perk
    Replied almost 6 years ago
    Eric, Thanks for reading and sharing what you do, Kevin
    Eric Worral Investor from Buffalo, New York
    Replied almost 3 years ago
    Eric, We’ve run thousands of background checks and your information seems to line up pretty well. We’ve found 649 to be the average renters credit score so keeping your score north of 650 lets you know you have a renter with above average score. I like your quote, “income will tell you the tenants ability to pay rent, credit score will tell you the tenants desire to pay rent.” I may steal that. Good stuff.
    Delia
    Replied over 3 years ago
    In Seattle WA, legislature just passed to tighten down on a Landlord’s ability to “cherry pick” tenants. Basically, the first tenant that applies & meets the criteria, must live in the house. Have you seen Landlords disclose their criteria? Either in the ad, or when applications are sent out? Would love your thoughts on this one Kevin!
    Eric Worral Investor from Buffalo, New York
    Replied almost 3 years ago
    Delia, I’ve read about this too in Seattle. I think the first-come first-served law went into effect starting in 2017. It’ll be interesting to see how this goes. Many landlords disclose their criteria in their listing or before accepting applications. In Texas it is a law to show your screening criteria to applicants and the applicants have to sign a form saying they were shown your criteria. So it’s a pretty common practice. I recommend including some of it in your rental listing (ie smoking policy, pet policy, income requirements) because it will sift out some bad applicants (for your rental) at that part of the process. Then in your prescreening on the phone I would make your screening criteria known, including that you run a background check (if you do) because this will scare away other bad applicants. The goal for when you show the rental is quality or quantity. 5-10 good applicants is way better than 40 terrible ones. Use your screening criteria as not only your standards by which you screen but a tool to attract/repel the right/wrong tenants to your property. Good luck with the first-come first-served law. -Eric