Screening for the right resident by conducting a thorough rent background check is an essential part of property management. After all, you want responsible residents who will live peacefully in your unit without damaging anything and pay rent on time. Unfortunately, finding residents who will do both of those things consistently can be difficult.
All property owners have the temptation of accepting the first person to show interest in the unit. Still, as anyone who has any experience in property management can tell you, that can end in disaster. It’s even more difficult because residents can go to great lengths to hide things in their past from background checks and your inquiries.
Learning how to get to the truth and thoroughly vet a potential resident is crucial. Here are a few things residents try to hide from background checks.
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Finding quality renters for your property is not always easy and becomes more complicated when applicants try to hide things on their background checks. Here are a few of the more common things applicants might try to hide from you:
A rent background check works by allowing you to see beneath the surface of a prospective resident. Similar to how an x-ray or MRI would work for a doctor, these background checks will identify any alarming issues that will remove applicants from the running entirely or demand a more thorough investigation.
Rental background checks can consist of varying details, but at a minimum, they should cover personal information, current address, income, and credit score. Combined, this vital information should give you a better idea of how responsible an applicant may be as a resident.
The applicant will be responsible for filling out all of their personal information. Whatever information you decide to put in this section, be sure you include the following:
These three identifying pieces of information are what will help you conduct your thorough rent background check. While some applicants might be hesitant to provide their social security number, this information is needed to move forward with the process.
Next, you’ll want to make sure to get the current address of any applicant. This information will provide you with a better understanding of their current living situation. Next to their address, you’ll want to include an area where they can identify whether they rent or own to paint a clearer picture.
As a property owner, it’s a good idea to have a minimum income requirement to be considered. Some require two or three times the amount of rent for monthly income, depending on the area. Make sure you disclose any minimum income requirements with potential applicants.
From this information, you’ll want to check:
The majority of the pertinent information from a rental background check is going to come from the credit score, which is typically pulled from one of the three major credit bureaus:
Because credit scores compile many factors, it’s crucial to get a thorough look at why their credit score is what it is. If you have questions, don’t be afraid to ask your resident. They might have a legitimate reason that explains any questionable scores. Some property owners just look at the overall credit score, while others will dig into the details.
Since applicants know that background checks are such an essential element to becoming prospective renters, they will go to great lengths to cover up any signs that show they might not be a good fit for your property. Here are some of the more common things residents will try to hide from background checks to be aware of.
One of the main things a resident will try to cover up or keep from you is their credit history. Some of this will inevitably come up when you run a credit report, but there’s more to it than just what the credit bureaus tell you.
In addition to your standard credit reports, there’s also additional critical information to obtain. Some of these details might include whether or not they have been foreclosed, have been evicted, have had their wages garnished for any reason, or have been sued for non-payment, essential, or have failed to pay child support or alimony.
Prospective residents with something to hide also don’t want you to know the whole story about their previous rental experiences. Being evicted falls under this, including late rent payments, damage to units, bounced checks, or getting in trouble with the law due to noise violations and other ordinances.
Bad renter history is why references are so important – you want to check with a previous landlord and see that this person has everything in order before you rent out your unit to them.
Finally, prospective residents will try to keep their criminal records from you. Fortunately, that’s not that easy to do. You should check their criminal background through a background check and see if there are any red flags. This isn’t to say you should automatically refuse any resident with a criminal background; some of the best residents we’ve seen had records. But, it is something to be aware of.
To avoid having to deal with any of the drama of uncovering some of the hidden truths of prospective applicants, you can hire a property management company that can go through the trouble of finding great residents on your behalf, so you don’t have to. Regardless of whether you use a property management company or handle it yourself, you need to prioritize a thorough rent background check for each applicant.
Matthew is the CEO of Evernest. He is a student of the book Good to Great and is passionate about building the best property management company on the planet (and maybe even the universe if Elon Musk will hurry up). You can usually find Matthew at the baseball field with his son, at a dance recital with his daughter, or at his favorite restaurant with his wife, when he’s not in the office. And if you can’t find him in any of those places, it probably means he’s traveling.
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