Tips on How to Screen Tenants for the First Time

Screening tenants is arguably one of the most important parts of the rental process, especially for first-time landlords who want to ensure they find reliable and responsible tenants. Learning how to screen a tenant can seem daunting, but understanding how it works and using the right strategies can make it more manageable. Tenant screening may help you avoid potential issues associated with an ill-fitting tenant, like late payments and property damage, while helping ensure a good experience for both you and your tenants.

According to a survey, close to 90 percent of landlords check for previous evictions, income and job history, rental history, credit scores, and criminal backgrounds when deciding who to rent to. Knowing how to screen a tenant mitigates risks and protects your investment by identifying those likely to pay rent on time every month and caring for the property properly.

According to a Housing Matters survey, close to 90 percent of landlords check for previous evictions, income and job history, rental history, credit scores, and criminal backgrounds when deciding who to rent to. Knowing how to screen a tenant mitigates risks and protects your investment by identifying those likely to pay rent on time every month and caring for the property properly.

This article will walk you through the some tips on how to screen tenants for a rental property for the first time, providing you with the tools and knowledge needed to help you find the right renters for your property:

Tenant Screening Challenges for First-Time Landlords

Screening multiple tenants can be particularly challenging for first-time landlords who may not be familiar with the nuances of the process. Knowing how to screen a tenant may help you find reliable renters and avoid these tenant screening warning signs. Below are some key areas where first-time landlords often face difficulties:

Understanding the Screening Process

For many first-time landlords, the tenant screening process can be overwhelming. It involves multiple steps, including credit checks, criminal background checks, income and employment verification, and rental history confirmation. Understanding each step and how to execute it properly is helpful for making confident leasing decisions.

Recognizing Potential Red Flags

Identifying potential red flags in a tenant's application is vital. Concerns like a history of late payments, evictions, or criminal records may indicate potential future problems. Recognizing and interpreting these red flags can help prevent selecting an ill-fitting tenant.

Establishing Clear Screening Criteria

Do you know the true cost of an eviction? Landlords often have expenses related to property damage repairs, lost rental income during the vacancy period, and advertising costs to find new tenants. This is why finding the tenants who are less likely to get evicted is important.

Setting clear and consistent screening criteria helps landlords evaluate all applicants fairly. This includes deciding on minimum income requirements, credit score thresholds, and acceptable background check results. Clear criteria can streamline the screening process and make it more objective.

Create a Detailed Rental Application

A detailed rental application helps you gather the necessary information about prospective tenants. You should consider including:

• Personal details: Full name, contact information, date of birth, and Social Security Number (SSN).
• Employment info: Current employer, position, length of employment, and salary.
• Income info: Monthly income, additional sources of income.
• Rental history: Previous addresses for the last five years, landlord contact information, and reasons for leaving.
• References: Personal and professional references, including contact information.

Advertise Your Property and Pre-Screen Applicants

Create an effective listing by highlighting key features of your rental property, such as location, amenities, rent amount, and lease terms. To pre-screen applicants, you should consider asking initial questions to filter out potentially unsuitable candidates.

These questions may help you gauge potential renters' suitability before you go deeper into their applications.

Collect and Review Rental Applications

Once you have a pool of interested candidates, collect completed rental applications, ensuring all required information is provided. Conduct an initial review by checking for completeness and verifying basic details. Look for any potential red flags, such as inconsistencies or missing information.

Conduct Background Checks

When conducting background checks, make sure you comply with all applicable federal, state, and local laws on how to set screening criteria, conducting the background check and using the information.

Tenant screening services like TransUnion SmartMove® can help streamline this process for you, providing tenant screening reports, including credit checks, criminal background checks, and eviction records. We also offer the proprietary ResidentScore, which helps predicts the likelihood of an eviction more accurately than a general credit score.

Verify Employment and Rental History

You need to know if your tenant will be able to make timely rental payments every month. To verify an applicant's employment, you may consider contacting the applicant's employer to confirm job stability and income. Request pay stubs, tax returns, or bank statements to potentially help verify their income.

You can also contact previous landlords to ask about rent payment history, property care, and any concerns the previous landlord may have. A few questions you might want to consider asking the previous landlord are:

• How long were the tenants at the indicated address
• Were they timely with their monthly rent payment
• Do you have a copy of their rent records
• Would you rent to them again

Verifying rental history may also indicate whether the prospective tenant has ever been evicted, which may be a potential concern.

Make a Decision and Communicate with Applicants

Compare applicants based on your screening criteria and overall fit. Choose the applicant who best meets your standards, and contact them as soon as possible, as they might be looking elsewhere at the same time they're interested in your property.

You should notify both successful and unsuccessful applicants*.

* Always consult legal counsel to help comply with state, federal and local laws in your area when determining what needs to be included in your notice to unuccessful applicants.

How to Screen Tenants FAQs

How do I handle applicants with pets

If you plan to allow pets in your rental, establish a clear pet policy that includes details about pet deposits, additional fees, and any breed or size restrictions. Make sure to include this information in your rental listing so potential tenants are aware of your pet policy upfront.

When reviewing applications, confirm that the applicant agrees to your pet terms and is willing to comply with any related conditions.

How do I verify self-employed applicants

Verifying self-employed applicants may seem complicated, but it can be straightforward. Ask for their tax returns, bank statements, and profit and loss statements to get a detailed view of their financial health.

These documents may show you whether someone has enough income or money to pay rent on time.

How should I handle international applicants or those without a Social Security number

If you have international applicants without a Social Security number, you can verify their visa status, employment, and income through alternative sources. Request a valid passport to confirm their identity and legal status in the country. Then, you may be able to verify their employment by contacting their employer and requesting proof of income, such as pay stubs or bank statements.

What should I do if a tenant requests to negotiate screening criteria

If a tenant wants to negotiate your screening criteria, you should be transparent about your process and why it exists. However, you can also provide reasonable accommodations if the applicant aligns with your overall rental policies and doesn't compromise the integrity of the screening process.

Get Fast Tenant Screening with TransUnion SmartMove

Knowing how to screen tenants is arguably one of the most important parts of the rental process if you want to find reliable and responsible tenants. Screening potential tenants may help you avoid potential issues with an ill-fitting tenant, like late payments and property damage, while helping ensure a good experience for you and your tenants.

Transunion SmartMove simplifies the tenant screening process, giving you reports that include credit checks, criminal background checks, and our proprietary ResidentScore. ResidentScore offers a more accurate prediction of eviction risk compared to traditional credit scores. Trusted by over 600,000 property owners and over 4.4 million tenants. SmartMove is a robust tool for making the right tenant decisions.