One of the most important components of screening potential tenants is asking for and verifying references. References from past landlords, employers and others who can verify their character can help to confirm the applicant is a trustworthy individual. The same procedure should be used for every potential tenant in order to stay compliant with the Federal Fair Housing Act. Inconsistencies could be seen as discriminatory and might cause a tenant to take legal action.
Landlords can use these 4 tips for verifying references.
1. The Rental Application
A quality rental application can assist landlords in conducting a thorough check of a tenant’s references. They can be created from scratch; however, there are also a number of pre-made forms that can be downloaded from the Internet. There should be lines related to gathering information about former landlord(s), rental dates, amount of rent paid per month, number of late payments, and any legal action taken. The applicant’s date of birth, social security number, employer references and character references should also be collected.
2. Authorization for Background, Reference and Credit Check
Written authorization should be obtained from the applicant allowing the landlord to complete a background search and credit check as well as for verifying references related to past rental history and employment. This can be easily accomplished with text on the application with a line for the applicant to sign and date it verifying that they give their permission.
3. Verifying References by Calling Previous Landlords and Employers
The applicant’s previous two landlords and employers should be called to verify their track record as a tenant and an employee. Valuable information can be yielded from these conversations that can help to determine if an applicant is a good fit. Some landlords and employers may ask to see a copy of the written permission given by the applicant.
4. Check Credit History and Criminal Background
Reference verifications can be augmented with a credit history and criminal background check using a tenant screening service. Using a professional tenant background screening service requires a fee, but in many cases it can be passed along to the rental applicant. Some states have specific rules and limits for doing so; landlords should verify the laws for their area. They might also consider refunding this cost from the first month’s rent.
Verifying references and having a thorough tenant evaluation performed can help landlords to connect with quality tenants. These four steps are key to rental applicant verification and can help to prevent stress and headaches down the road.
Disclaimer Statement: All information presented is never intended as legal advice and is for information purposes only.
I like the suggestion to complete a background search and credit check on each tenant. This is a great way to be able to see who the tenant is and the possible problems that may arise from having them as tenants. I would think that this could also be a good way to see if the tenant can actually afford to rent from you. Checking to see how they are doing financially will give you a sense of how paying rent will happen.