How to pre-screen tenants so I can get the best applicants
Hi All,
What is the best way to go about pre-screening tenants so that I can get the best pool of applicants? Obviously we would also do this legally as well. I think I remember this from a Bigger Pockets podcast episode but cannot remember which one?
@Kobe McDaniel - Whatever standard you develop, I would write it down, and use it for every application. This approach helps provide consistency as well as giving you a way to prove you treated everyone equally in the event a complaint is ever filed.
Here is what we do to screen our tenants.
1) Did they follow the application process and submit everything as requested. If so, start checking their info, if not, move onto the next applicant.
2) Run an eviction history report
3) Run criminal background check
4) check sex offender list
5) Set a ratio between rent and minimum income. For example, we us 1 to 3. If rent is $1200 per month, then they need an income of $3600 to apply. Make sure you verify income.
6) Ask for landlord references and call them all.
7) Ask for employment info, and call the previous employers as well as current employers.
8) Set a minimum credit score. We use 650. If all the other areas check out, then we will sometimes make this standard our one compromise. If we bend on the credit score we will do something else to offset risk like a double deposit.
9) If they have pets and if you allow pets, be sure you put an entire process in place to manage this risk.
I'll be interested to see what other methods folks have to validate good applicants ... best of luck as you get ready to lease your property!
- Investor
- Austin, TX
- 5,503
- Votes |
- 9,861
- Posts
Include tougher barriers to entry, must make three times the rent, 600 minimum credit score, etc.
Quote from @Kobe McDaniel:
Here's a detailed guide to help: https://www.biggerpockets.com/...
I put my pre-screening requirements in each advertisement. If applicants know you require a credit/criminal screening and charge $XX for each person, that will chase away a lot of tire kickers. If they know you require verifiable income 3x the rent, or that you won't accept dogs over 30 pounds, it will chase away a lot of tire kickers.
Pre-screening should include 3-4 of the most important disqualifiers so a reader can quickly determine whether it's worth their time to inquire further.
I always review the application first to ensure it's complete, they've paid the application fee, everyone in their party has applied, and there are no immediate disqualifiers (lack of income, registered sex offender, etc.). If they've pre-screened and then passed my visual review, then I'll process the application.
3X income to rent ratio
650+ credit
No evictions
Verify Income / Past Landlords
VET VET VET!
Clean background check. No priors.
Great tips given thusfar!
Our actual pre-screening process looks like this:
1. We list our criteria (similar to that previously listed) in our listing. This way some prospects disqualify themselves.
2. If someone is interested, we have them fill out a Pre-Screening Google From. This is totally free for the prospect and isn't verified information. But the purpose is to quickly gather info and tell a tenant if it probably isn't worth their time to them to fill out an official application. So for example, we ask for their ballpark scredit score. If it is under our criteria, I'll tell them that they likely wouldn't qualify; however, they are welcome to fill out an application.
3. Lastly, they fill out the official application (through Innago in our case), and this returns the more verified info such as background check and credit check.
I hope this helps 😀
Quote from @Kobe McDaniel:
Hi All,
What is the best way to go about pre-screening tenants so that I can get the best pool of applicants? Obviously we would also do this legally as well. I think I remember this from a Bigger Pockets podcast episode but cannot remember which one?
almost every rental management tool has pre-screening built in, which is east to use. there are 10+ such tools and the ones I’ve used: azibo, Hemlane, Turbotenant, Zillow rental manager.
They mostly use TU SmartMover for background checks.
Choose the platform with the most complete features that matter for you, and that is friendly to use. Let me know if you’d like to learn more.