After the Great Recession and the 2008 housing crises, a majority of Americans have chosen to rent properties, rather than buy. Many major cities have more renters than they do homeowners.
With such a high demand for rental properties, it's important to know who you're renting to. Tenant background checks are a vital part of the screening process.
Still, aren't sure if you need to do a background check? Keep reading! By the end of this article, you won't hesitate to do a background check on every applicant.
Screening tenants is the best way to make sure they are who they say they are. If your tenant is a United States citizen, you can ask for a driver's license, passport, social security card, or another form of legal identification.
When the tenant or applicant is not an American citizen, you need to verify that they have a work visa, green card, or other authorization to stay in the country. This authorization needs to last for the duration of the lease. If they have no legal reason to stay, they might leave before the lease is over.
You need to verify the identity of your potential tenant to complete the background check, like criminal and rental histories.
Maintaining a Safe Environment
As a property manager, screening tenants is important to ensure the safety of every renter. You are bringing this applicant into a community, and it's your responsibility to keep that community safe.
Criminal background checks inform you of any criminal history your tenant might have. If the criminal history could potentially put other renters at risk, you can deny that applicant. But, it needs to be clear you are denying them because of the risk they pose and not for discriminatory reasons.
Following the Law
Tenant screening provides you with as much information as possible about your applicant. If something related to that tenant goes wrong, they can sue you for negligence if you did not perform a background check.
You cannot deny tenants based on sex, disability, national origin, race, familial status, or other discriminatory factors according to the Fair Housing Act. If you deny a tenant for a discriminatory reason, they can sue you for discriminatory practices.
When you deny a tenant, your reasons need to be clear and legal.
Finding a tenant isn't an easy process, and you want tenants to stay for as long as possible. Performing tenant background checks can inform you of their rental history. If they struggle to pay rent, you can deny them before you have to deal with missed rent payments.
Your potential tenant will need to provide a lot of information to do a background check. The time this takes means only tenants willing to go through this process will do it. Once approved, they will stay as long as they can to avoid going through another application process.
Tenant Background Checks Are a Must!
Tenant background checks help you verify an applicant's identity, follow the law, prevent turnovers, and promote a safe environment. Taking the time to perform one shows your dedication to creating a fantastic living situation for all tenants.
If you need help screening tenants or you don't know where to start, Investor's Reality is here to help! We want to help you take the stress out of being a landlord in the Denver metro area. Our team of real estate experts can make sure you pick the best tenants possible for your property!
Contact us today to learn more!