Renting out your property can be a seriously lucrative business, but only if you do it right. In some cases, you might come across a bad tenant who doesn’t take care of the property or who doesn’t pay your rent on time – or even at all. While there’s no way that you can fully guarantee you won’t get a bad tenant, there are steps you can take to make it an unlikely possibility. Keep reading to learn more about how to find the perfect tenant!
Get in touch with a real estate agent
Although you can get a ton of exposure for your rental ad through websites like Rent.com and Craigslist, it’s often better to link up with a qualified real estate agent who can help you properly market. This is especially helpful if you have more than one listing. The agent will list your place on what’s called Multiple Listing Sites (MLS).
A real estate agent also has experience on their side and can help you create a foolproof rental agreement.
Get a deposit
Deposits are incredibly important to have when you’re renting out a property. They protect you from damage a tenant living on your property can cause. You will have to check your local and state regulations about setting the deposit amount. In most places, there’s a limit to the amount you can charge. You can also decide whether you want to allow pets and if so, what you’ll charge for a pet deposit. Alternatively, you can charge monthly for a “pet rent.”
Complete a credit check
The best way to vet a potential tenant is by requiring a credit check. A tenant might seem great on the outset and have great references but going on those elements alone is a bad idea. Invest in a SmartMove tenant credit report as a starting point to better evaluate an applicant.
A credit check can be run in just a few minutes and with it, you can decide whether or not your potential tenant is a good choice. Plus, this kind of credit check is a soft pull on the tenant’s credit score which won’t ding their score.
Follow the law
One of the most important parts of running a rental business is abiding by the law. For example, the Federal Fair Housing Act ensures that nobody is discriminated against on the basis of religion, family status, sex, race, or disability. If you’re not sure if you’re complying with the laws, make sure you reach out to a rental law professional. Otherwise, you can be sued for discrimination or fined.
Screen the person in real life
Another important part of the rental screening process is actually meeting your tenant in real life. You’ll be able to gauge whether or not they’re a good fit during this part. Here are some questions to ask a potential renter:
- Do you rent currently? If yes, where?
- Why are you looking for a new place to live?
- What is your ideal move-in date?
- How long have you lived in your current resident?
- Do you have any pets? If so, how many?
- Do you smoke?
- What is your employment situation?
- What’s a rough estimate of your salary?
- How many people will be on the lease?
- Do you have an eviction in your rental history?
- Does your current landlord know you’re leaving?
- Will you pay our rental application fee?
- Will you be able to pay our security deposit upon move-in?
- Do you have any questions about the rental process?
Aim for a long-term tenant
If you hate the process of looking for a new tenant, your best bet is screening for tenants who are looking to stay in one place for a long time. A long-term tenant will mean less work for you in the long run.
Screening for tenants can be difficult. It’s already a hassle trying to rent out a place and all the work that comes with marketing and showing the space. On top of that, you have to ensure that the people you’re renting to are responsible. The most important step of the process is making your new tenants or prospective tenants undergo a full background and credit check. While this won’t guarantee anything, it will help you better spot red flags.