Without a good tenant, your rental is less than worthless. Your life is going to get eaten up with complaints and errands, you’re not going to be able to count on rent, and I wouldn’t wish going through the eviction process on my worst enemy. If you didn’t need tenants, investing in real estate would be the easiest thing on earth. Fortunately, here in the real world there are a lot of things you can do to ensure you’ll have good people living in your houses.
The key thing while screening potential tenants is to make sure they can and will pay the rent. Their credit score is an easy and available rating, just what you need. I usually cut applicants off if their score is below 640. Proof of income is the other thing: make sure they have a job and can afford your rent. Ideally they’ll make three times the rent, but if they’re earnest and reliable they may make twice. The bigger the buffer, the less likely they’re going to stiff you on the last day of the month because other bills got to them first.
The next piece of the puzzle is the criminal record. I don’t flat-out reject someone just because they got arrested in the past -- little indiscretions aren’t the definition of someone’s character. If they did something felonious or extra heinous, though, I don’t want them in my building. It can be tough, but I find other outlets for being charitable without jeopardizing my property value. A bad tenant can ruin a rental in more ways than one.
Finally, you have to meet your tenant face to face, really get an impression of them. If you advertised your property well, you’ll probably have a handful of applicants who passed the financial and criminal tests. Pick the one you have the best feeling about and rapport with. If they like you too, even a little, they’ll be a lot more civil in your interactions and just treat your property better. Like so many facets of real estate, personal impressions mean a lot.
Leave as little as you can to chance. The human element to renting is the most hectic and important part of it. Surround yourself with good people, tenants included, and you’ll have a lot less to worry about.
@Eric Eickhof Well said!
Thank you for your recommendations. It’s good that you mentioned face to face conversation. Some landlords don’t conduct interview with their applicants. And I think it’s a huge mistake.
Free eBook from BiggerPockets!
Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!
- Actionable advice for getting started,
- Discover the 10 Most Lucrative Real Estate Niches,
- Learn how to get started with or without money,
- Explore Real-Life Strategies for Building Wealth,
- And a LOT more.
Sign up below to download the eBook for FREE today!
We hate spam just as much as you
Create Lasting Wealth Through Real Estate
Join the millions of people achieving financial freedom through the power of real estate investing