Protect your investment by running a credit and background rating of prospective tenants. Tenants with a history of not paying their rent, which were evicted before, or have a criminal record are more likely to cause difficulties. Landlords have the right to review credit reports and run background checks when screening prospective tenants, nevertheless the Fair Credit Reporting Act requires landlords to follow proper procedure when doing this. Tenant screening businesses which carry out background checks for a commission will let you know if applicants pay their rent on time, have ruined prior rental properties, have criminal records, and also the way they had been rated by previous landlords.
Require all tenants to fill in a rental application form. This form will give you the essential information to carry out a background and credit rating. Request current contact information, the names and addresses of present and previous landlords and employers, social security number, driver’s license number and bank account numbers for credit check.
Include a credit report authorization form together with the leasing application. Section 604 of the Fair Credit Reporting Act requires that landlords request permission before conducting a credit rating. Obviously, a landlord can deny a consumer the ability to rent should he or she does not want to authorize a credit rating. Landlords, not the credit reporting bureau, are responsible for requesting and recording credit rating authorizations.
Run a credit report to the applicants with all 3 main credit reporting bureaus: TransUnion, Experian and Equifax. Credit reports will let you know about your prospective tenant’s credit history: foreclosures, bankruptcies, unlawful detainer suits, evictions and other credit-related public record occasions. They will also supply you with a credit rating for every applicant. The credit rating speeds the financial reliability of the consumer; the higher the score the greater.
Hire a tenant screening company to carry out a background check on your applicants. A background check can include a national and state criminal report, a sex offender database search and earlier speech history confirmation. Tenant backround checks can cost anything from $20 to $50, depending upon the thoroughness of the investigation.
Contact your candidate’s present and previous landlords to ask for references. Telephone the present employer to verify earnings, and query other references to be certain that the information provided on the application form is accurate.