| When it comes to Property Management probably | | | | fact that you want to be able to determine whether |
| one of the most difficult aspects is determining who | | | | they can actually afford the payment. I use a little |
| you are going to rent. Typically, you place the property | | | | higher ratio than most managers. I have found that you |
| for rent on a multitude of marketing mediums and after | | | | can go to a 45% housing ratio and have a very good |
| showing several possible tenants one of the prospects | | | | tenant. Taking that into consideration, you have an |
| will ask to fill out a rental application. This article will | | | | obligation to not set your future tenants up for failure |
| discuss the steps that must be taken in order to weigh | | | | and if you know they cannot afford the place your |
| the possible risks and to help you become an expert | | | | best bet is to find a tenant that meets the income |
| at determining who you should rent to and who you | | | | requirements. |
| should tell to go fly a kite. | | | | Landlord Verification: This verification and the credit |
| The rental application is the first key to performing a | | | | check are where I typically put the most weight. The |
| quality evaluation of the prospective tenant. If you | | | | previous landlord can be of extreme help or |
| would like a copy of my rental application simply go to | | | | detriment(see later in this section) to determining a lot |
| my website and fill out the contact form. | | | | of factors about your potential tenant. I always |
| The rental application should be concise enough that | | | | recommend contacting two landlords or if they do not |
| the tenant will actually fill it out and also in depth enough | | | | have that much history getting a co-signer on the |
| to gather all of the information that you will need to | | | | lease. The previous landlord will know whether the |
| perform a thorough screening of the tenant. (It also | | | | tenant paid on time, how much they historically could |
| should contain information that might help you down | | | | afford, whether they breech any terms of the |
| the road if you have to perform an eviction and need | | | | agreement and whether they caused any damage. |
| to be able to collect from wages or from funds the | | | | The reason why I stated they could be a detriment is |
| tenant may have.) With that being said, what should be | | | | due to the fact that they could be motivated to get |
| included in a rental application? Below you will find key | | | | the tenant out of their property and are looking at you |
| items to have in your rental application: | | | | as an exit. |
| - Social Security Number, Date of Birth | | | | Credit Check: Credit can tell you a lot or a little. It really |
| - Current Address, Former Address, Including landlord | | | | depends upon the applicants credit history. Some |
| numbers | | | | applicants have a very in depth credit history which a |
| - Current Employer, Former Employer, Including Work | | | | lot of the time there is a reason why they are renting |
| numbers | | | | and not purchasing. Even if they have bad credit it |
| - Bank account #, Current income | | | | does not necessarily mean that you should not rent to |
| - Whether the Tenant has ever been evicted | | | | them. Many of my best tenants actually have had bad |
| - Authorization to verify all the information on the form | | | | credit in their past but, due to the fact that it was only |
| and also to perform a credit and back ground check. | | | | a onetime event or over a year and they have solved |
| The next step after the rental application is actually | | | | the problem, I decided to rent to them. I do not look for |
| qualifying the tenant. The majority of property | | | | a certain credit score i.e 680 + or 600 + I typically look |
| managers will tell you that when you have multiple | | | | at their debt load and whether they make their |
| applicants you should work on a first come first serve | | | | payments or not. There are also other factors you |
| basis. Meaning, start to qualify the first applicant, | | | | want to use the credit report for such as verifying that |
| typically I begin with employment and landlord first so | | | | the tenant is actually who they say they are and also |
| as to not have to waste money or an application fee | | | | whether the residence database matches the |
| should they not pass those requirements. Now that we | | | | information disclosed in the rental application. |
| have determined the method of processing the | | | | In conclusion it is during the screening process that |
| applicants we will go through what you are looking for. | | | | 99% of all property management issues can be |
| Employment Verification: Depending on the property | | | | solved. The most difficult part of property |
| manager, they follow different guidelines when it | | | | management is finding the right tenant and the only |
| comes to verifying employment and verifying earnings. | | | | way you can do that is through trial and lots of error, |
| At a minimum you want to verify that they are | | | | or by hiring an experienced property manager. The |
| currently employed, I personally recommend verifying a | | | | steps above are only a brief overview of what you |
| current paystub and a w-2 or 1040. This is due to the | | | | should take and what you should look for in a tenant. |