The search for the perfect tenant for your real estate rentals is no easy task, and the best match for you may be a mix of compromises of the traits you require. This scenario is, of course, only probable if you have no standard list of criteria you wish for in a tenant. The worst scenario is that you may end up with a series of problems sooner or later. You may end up with an eviction problem, compromises on late payments, or even expenses due to property damages. You need to set standard criteria upon which your possible tenants must meet before qualifying, thus, the tenant screening process.

What is Tenant Screening

Tenant screening is a process you can employ to assess who amongst the applicants would most likely satisfy the terms and conditions of your lease agreement. In this process, you gauge or evaluate applicants based on their merits with respect to your criteria. In evaluating applicants, one helpful step you should consider is to ask them to fill up a pre-screening form, and if they pass this, you can direct them to an application form that reflects in more detail what you are looking for in a tenant. This step minimizes direct contacts and saves you time and effort. You can use Google Forms in preparing the forms. You can generate a spreadsheet presenting all the details and information for review and reference later when you are ready. There are many Google Form Rental tutorials on YouTube to help you customize your tenant screening forms. In a pre-screening process, you can have the luxury of selecting only the most compatible applicants deserving of a response. The process will also save you time because you only show the place to pre-qualified tenants. Secondly, you will be able to see who did not pass your criteria. For instance, if you do not allow pets in your rental, those who own pets will be disqualified automatically.

How do I screen applicants?

There are many ways to screen in the Real Estate Rental Industry. An old-fashioned way is to meet with the tenant applicants, show them the property, and have them sign an application form. This process is time-consuming and deprives you of pre-screening privileges. Pre-screening your applicants allows you to at least minimize the property showing to those who have passed your initial criteria.

Setting up your Criteria: Pre-Screening

Before the house showing, you can screen the applicants with an online questionnaire. If a tenant is interested, you can send them a link to your pre-screening form to their email where they can answer questions as honestly as possible. Before proceeding to the pre-screening process, you can ask them to answer the questions truthfully and honestly. This question sets the tone of the process, and they will most probably do so as requested. If the respondent tenant answers negatively, they are automatically directed to a page that says they do not meet your minimum criteria. Here are questions you can use in your initial pre-screening process:

Do you smoke?

This question has been a deal-breaker for some landlords because of the stains and the smell of smoking. Many landlords have had a hard time getting rid of the smoke stains and odor when a tenant who smokes vacates the property. In some cases, the smell even infuses with the wallpapers.

How many of you are adults?

You need to know how many of them are adults, and you might want to include them in the contract, even if they will not be involved in the monthly payments.

Do you have pets?

If you are okay with pets, you might want to know the breed and their weights to gauge if there will be possibilities of damages to the property.

Have you been convicted of a crime (felony, manufacture or distribution of controlled substances, or sexual misconduct)?

Any affirmative answer to this question is a red flag. You do not want to endanger yourself or your neighbors with a person of such findings. You may also be the subject of lawsuits if an untoward incident happens concerning your tenant.

Is your gross income more than $3,600.00 per month?

As a rule of thumb, the total gross income of would-be tenants should at least be three times the monthly rental. To illustrate, let us say you rent for $1,200 a month, then the gross income of your tenant should be a minimum of $3,600. The idea is that your lessee will have income left for other needs and expenses such as food, clothing, meds, and school.

Will you be amenable to paying for background checks and credit checks?

An applicant willing to shell out fees for background checks and credit checks most likely has nothing to hide from you. On the other hand, if the applicant has a problem paying a $35 to $50 fee for background and credit checks, you may have difficulties collecting a $1,200 a month rental.

Setting Up your Criteria: The Application Form

If your applicant passed your pre-screening or pre-qualification process, you ask them to fill out an online application form for more details. The application form asks for more detail such as sources of income, employment history, credit history, and rental history, to name a few examples. You should have sufficient data from the applicant to allow an informed and educated decision. One of the notable advantages of an online application form is that answers to all questions are mandatory. If applicants choose to skip a question, they will be stuck on the page and will not be able to submit the form. Have the applicants print the form and sign it. Do not forget to include an authorization letter allowing you to conduct verifications on the information. They can submit the filled-up and signed form during the house showing.

Here are suggestions to consider for your online tenant application form.

Willingness to undergo a Credit Report?

A credit report gives you an overview of how the tenant applicant handles finances. Unpaid debt obligations are red flags. A credit score of 650 and above is ideal. However, if the applicant can pay your monthly rental, there may be a good reason why they have a low credit score. You can still consider their application provided they can justify the low score. As a general rule, though, a low credit score can signify future defaults in payments.

In a Credit Report, you will find the full name, the current address, and employment history of a person. The report also indicates active accounts of an individual, including loans and credit cards. You can countercheck the information stated in the application form with a credit report for discrepancies.

Employment History

Someone with continuous employment in the past two years indicates financial stability, and better if the applicant has been with the same employer for at least two years. You might see some gaps in employment, and you might want to ask the applicant what happened during that time. Since the application form already includes an authorization for you to verify the information details, it is best to call their employers and verify the information they have provided. Furthermore, you can ask for payslips as proof of income or two years’ worth of tax returns. A verification with his current employer can also help you in your decision-making process.

Willingness to undergo a background check.

Background checks will tell you if a person has a criminal record. Criminal activities you should be aware of should include felonies, manufacture or distribution of controlled substances, arson, or destruction of property. All these can be a cause to decline the application. A background check displays records from different law enforcement agencies.

Rental Verification

In the application form, you can ask for a list of previous landlords they’ve had. You can call the previous landlords to verify some details and ask if there were cases where the applicants failed to pay their rental payments on time. If the previous landlord will take them in again is a good sign that they are good tenants.

A move-in date in a short period can mean that they are having issues with their current landlord or are for eviction. You can set Be aware of the small details that can give you clues about the tenant’s behavior.

The Fair Housing Act

Knowing local and federal laws regarding rental properties will help you from getting into trouble when searching for a tenant. You should know the Seven Protected Classes under the Fair Housing Act and be careful with your pre-screening process and application form, so you will not be charged with discrimination. The protected classes are Race, Color, Religion, National Origin, Sex, Familial Status, and Disability.

Making the Process Easier and Faster

Selecting your next tenant requires some serious effort from you. You do not want to show your property to everyone who inquired about it without knowing the bare minimum about them. Tedious and dangerous even to some extent. As mentioned previously, Google Forms can help you screen and automate your selection process and only consider those within your criteria and serious about the rental. The pre-selection process also allows you proper time management in showing the rental to applicants.

You can also partner with agencies for an automated tenant selection process. There are also companies online that can help you in your screening process and your rental property management. These are some of the popular choices in the industry: Rentspree, Rentprep, Apartment.com (formerly Cozy.co), and Turbotenant. You can ask applicants to pay for their own checkings, so you do not have to pay the fees out of your own pocket.

Final Words: We Remain at Your Disposal

An ideal or nearly ideal tenant would be one who can pay on time, cares for the property like the owner does, someone who goes along well with the neighbors, and follows the rules in the contract by heart. These may be wishful thinking but are attainable with the proper tools and mindset. The property rental industry has also adapted to the times and maximized the potential of the internet to simplify the age-old processes of property rentals. With an online screening, you can now assess all applicants to your rental and show it only to those who are within the criteria you have set. Mindful, of course, to the Fair Housing Act. Online tools like Google Forms and Google Sheet help in this aspect. You can tap the services of various companies and websites catering to landlord needs that make it easier for you to select your tenants and manage your properties.

You do not have to worry about tenants anymore as you expand your portfolio. You can now simplify and minimize the efforts of choosing the best tenant for you, paving the way for portfolio expansion. Our expertise at GL&L Holdings is helping landlords expand their rental portfolios. Call us at (832) 770-9415 or email us at info@gllholdings.com. We can talk about your expansion plans in any way you want. You can also visit us at 14780 Memorial Dr, Suite #220, Houston, TX 77079 if you are just around Houston.