Tenant Screening Software: What is Tenant Screening?
Intro
Are you currently looking at screening some tenants? Possibly this is your first time, or maybe you've done it a few times but are just having a hard time finding the "right" tenant.
In this article, I will go over what tenant screening means, some of the most important steps into tenant screening, some software that can really help you up your game, as well as some questions I personally use on every tenant.
Let's dive right in!
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What Is Tenant Screening
Tenant screening is a process used by landlords, property managers, and rental agencies to evaluate prospective tenants before leasing out a property to them.
The purpose of tenant screening is to assess the likelihood of a tenant fulfilling their lease obligations, such as paying you their
rent on time, take care of your property, and adhere to the terms of the lease agreement.
Tenant screening typically involves several steps, including:
Rental Application: Prospective tenants are required to fill out a rental form, providing personal information such as their full name, current address, employment history, income, and references.
Credit Check: Landlords often conduct a credit check to assess the tenant's financial responsibility and ability to pay rent on time. This involves obtaining the tenant's credit report, which shows their credit history, including payment history, outstanding debts, and any bankruptcies or foreclosures.
Background Check: A background check may be conducted to verify the tenant's identity and check for any criminal history, evictions, or previous rental-related issues.
Income Verification: Landlords may request proof of income, such as pay stubs, employment verification, or tax returns, to ensure that the tenant has a steady source of income to afford the rent.
Rental History Verification: Landlords may contact previous landlords or property managers to inquire about the tenant's rental history, including their behavior as a tenant, payment history, and any issues during their tenancy.
References: Prospective tenants may be asked to provide personal or professional references who can vouch for their character and reliability as a tenants.
By conducting tenant screening, you can make more informed decisions about who to rent your property to, reducing the risk of late payments, property damage, or other issues during the lease term.
How Tenant Screening Software Work?
Tenant screening software automates and streamlines the process of evaluating prospective tenants for rental properties instead of doing everything manually.
Here's how it works:
Online Rental Application Submission: Prospective tenants fill out digital rental application forms online. These forms collect personal information such as full name, current address, employment history, income, and references.
Data Collection and Verification: The software collects the information provided by the applicants and verifies it through various sources. This may include credit bureaus for credit checks, employment verification services, and databases for criminal background checks and eviction history.
Credit Check: The software accesses the applicant's credit report from major credit bureaus to assess their creditworthiness. It examines factors such as payment history, outstanding debts, and credit score.
Background Check: Tenant screening software may conduct background checks to verify the applicant's identity and check for criminal history, eviction records, and other relevant information.
Income Verification: The software may request proof of income from the applicant, such as pay stubs or tax returns, and verify this information with employers or other sources.
Rental History Verification: The software contacts previous landlords or property managers provided by the applicant to inquire about their rental history, including payment behavior and any issues during their previous tenancies.
Decision Making: Based on the information collected and verified, the software generates a comprehensive report or score indicating the suitability of the applicant as a tenant. Landlords or property managers can use this information to make informed decisions about whether to approve or deny the application.
Compliance and Security: Tenant screening software ensures compliance with fair housing laws and regulations, as well as data security standards to protect the privacy and confidentiality of applicant information.
Overall, tenant screening software helps landlords and property managers efficiently evaluate prospective tenants, reduce risks associated with renting properties, and make quicker more informed leasing decisions.
Check out my Resource Page for some of the top software to help you on your Real Estate Journey
Tenant Screening Software Examples
Buildium
Buildium offers great tenant screening tools integrated into its property management platform, including online rental applications, credit checks, background checks, and income verification. For more information on Buildium take a look at my article "Maximizing Property Management".
Apartments.com (previously Cozy)
Apartments.com provides a user-friendly platform for tenant screening, offering features such as online rental applications, credit reports, criminal background checks, and eviction history reports.
RentSpree
RentSpree simplifies the rental application process with its online platform, offering credit reports, background checks, and eviction history reports for landlords and property managers.
AppFolio
AppFolio's cloud-based property management software includes tenant screening capabilities, allowing users to request credit checks, criminal background checks, and eviction history reports seamlessly. Take a look at my latest review on Appolio "Appfolio Review".
TenantCloud
TenantCloud offers tenant screening services along with other property management features, enabling landlords to request credit reports, background checks, and eviction history reports from applicants.
RentPrep
RentPrep specializes in tenant screening services, providing credit checks, criminal background checks, and eviction history reports to landlords and property managers.
SmartMove by TransUnion
SmartMove offers tenant screening solutions powered by TransUnion, providing credit reports, criminal background checks, and eviction history reports for landlords and property managers.
MyRental by CoreLogic
MyRental offers tenant screening services, including credit reports, criminal background checks, and eviction history reports, designed to help landlords and property managers make informed leasing decisions.
Tenant Screening Question: My Top 10
Here are ten tenant screening questions I believe are most important to ask along with explanations of why I consider them important:
What is your current employment status and income level?
This question helps you assess the applicant's financial stability and ability to afford the rent. It also provides insights into whether the applicant has a steady source of income to meet their rental obligations.
Can you provide references from previous landlords?
References from previous landlords can offer valuable insights into the applicant's rental history, behavior as a tenant, and reliability in meeting their lease obligations. Sometimes I even do Skype calls with a prospective tenant in their current home to get a good feel as to how they maintain their home.
Have you ever been evicted from a rental property?
Knowing about past evictions helps landlords understand any potential risks associated with the applicant. It provides information about the applicant's rental history and their likelihood of fulfilling the terms of the lease agreement.
Do you have any pets? If so, what type and how many?
This question helps you assess whether the applicant has pets that may impact the property or other tenants. It allows you to establish pet policies and address any potential concerns related to pet ownership.
Do you smoke?
Smoking can have implications for property maintenance and the health of other tenants. Knowing whether the applicant smokes helps landlords enforce smoking policies and ensure the well-being of other tenants.
What is your preferred move-in date?
Understanding the applicant's preferred move-in date helps you plan for property turnover and vacancies. It ensures that both parties are aligned on the timing of the lease commencement.
Are you willing to undergo a credit and background check?
Conducting credit and background checks is standard practice in tenant screening. Asking this question upfront ensures that the applicant is aware of the screening process and willing to provide the necessary information for evaluation.
Do you have any plans to sublet the property or have guests for an extended period?
Landlords need to be aware of any plans for subletting or extended guest stays to ensure compliance with lease agreements and property regulations. It helps clarify expectations regarding occupancy and potential subletting arrangements.
Have you ever been convicted of a crime?
Knowing about past criminal convictions helps landlords assess potential risks to the property and other tenants' safety. It allows landlords to make informed decisions regarding tenant suitability and property security.
Do you have any questions or concerns about the lease agreement or property rules?
Encouraging applicants to ask questions or raise concerns demonstrates transparency and helps clarify any misunderstandings upfront. It ensures that both parties have a clear understanding of the lease terms and expectations.
Asking these 10 tenant screening questions can help you gather relevant information to assess the suitability of prospective tenants and make informed decisions about leasing your property.
Outro
As you can see, tenant screening can be a daunting task, but if you create a system, utilize some software, and ask the right questions you can ensure you complete this task promptly as well as find suitable tenants for your property.
Tenant screening no longer has to be a task you put off until the last minute, it can be a process you look forward to.
Check out my Resource Page for some of the top software to help you on your Real Estate Journey
FAQ
How long does tenant screening take?
This Varies, in my personal experience 1-7 business days. The duration of tenant screening can vary depending on several factors, including the complexity of the screening criteria, the responsiveness of the applicant and his references, and the efficiency of the screening service provider.
How do you scan a tenant?
Scanning a tenant refers to the process of evaluating and assessing a prospective tenant's suitability for renting a property. This involves conducting thorough tenant screening, which typically includes verifying the applicant's identity, assessing their financial stability, checking their rental history, and evaluating any potential risks associated with leasing the property to them.
What background check do most landlords use?
Landlords commonly use various types of background checks to assess prospective tenants, including credit checks, criminal background checks, and eviction history checks. These checks provide valuable insights into the applicant's financial responsibility, criminal record, and rental history, helping landlords make informed decisions about tenant suitability.
What questions should I ask for a reference check for a tenant?
During a reference check for a tenant, landlords typically seek information from previous landlords or property managers about the applicant's rental history, behavior as a tenant, payment reliability, and any issues or concerns that arose during their tenancy. References can provide valuable insights into the applicant's suitability as a tenant.