It is difficult to determine if you have rented your property to a reliable person or not. Since different sorts of properties appeal to diverse types of renters, understanding the market and the leaseholders is crucial in finding the right tenants for your property.
Renting out your property is not just about profits, but it is also about having the right tenant to safeguard your investments. Being a landlord is not always worry-free because some tenants will curtail your domain and turn it upside down. Selecting the ideal tenants must not be arbitrary or be dependent on emotion. To prevent yourself from bearing the burden of dealing with difficult tenants, here are the 5 steps that you can apply in order to find the right tenant and in turn, protect your assets.
1. Follow the National Rule
It is a common knowledge that as landlords, you are bound to adhere to the policies set forth by the federal government. Even though you want to get the right tenant on board, you must submit to the Federal Fair Housing Rules. The law declares that you cannot deny anyone the right to rent your property based on their color, race, national origin, religion, sex, disability or even familial status. By adhering to the law, you are also saving yourself the risk of being accused of discrimination.
2. Get their Financial History
Before renting out your property such as your home or your lot, you can protect yourself by checking the credit history of the tenant. In order to get the right tenants to protect your ventures, consider the financial standing of the tenant.
Choose a tenant that is responsible enough to pay rent within the given time frame. Checking their income and verifying their source of funds is crucial. To get some preliminary details, you can require the renter to present some sort of confirmation. They can either submit their pay stubs or you can call their employers and verify their income and net worth.
3. Get A Credit Check
Getting a credit check will help you in having the right tenants for your homes and properties. The credit check can provide you a glimpse of their payment history and if they are paying on time. Also, it offers you the chance to see if they are in debt or not. You can also check if they have some history of evictions, civil judgments, or even a self-declaration of bankruptcy.
4. Check their Character
Knowing about your tenants could protect you in more ways than one. By getting a criminal background check, you are lowering the possibility of allowing a criminal to be your tenant. Since criminal information is a public record, doing some research about your potential tenants is imperative.
To get some valid data, you can ask for their ID and then conduct some research about them. However, you need to be careful about this step because depending on your location, some states do not allow discriminating renters because of their past criminal record.
5. Contact Former Landlords
The former landlords of your prospective tenants are considered as one of the best source of information. It is also helpful in verifying their credit history, their payment schemes and their financial strengths and weakness. Reaching out to their former landlords will help you in weighing the information and in making a decision.
Finding the right tenants to stay inside your homes or benefit from the shelter of your investments may be easier said than done. However, with these simple steps to assist you along the way, you can reduce the probability of renting your property to someone that is not financially responsible to pay for their debts, or to pay for their rents. Also, by doing a background check, you won’t have to deal with tenants that have some attitude issues or problems with their character.