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Red Flag Tenant Screening Warnings that Could Spell Trouble

Every landlord or manager wants a qualified, responsible tenant occupying their rental unit.

 

Because a bad tenant can be a nightmare, there is no doubt that you want to create or utilize comprehensive tenant screening criteria to find the best tenant for your rental property. While there are tenant screening options that will give you information about credit reports and other important criteria, you still need to know what constitutes a red flag and what questions to ask.

 

Managers, investors, and landlords should always look out for these red flags, warning that a potential tenant could spell trouble.

 

Look Out for The Obvious Warning Signs When Tenant Screening

These go-to red flags could spell disaster should you accept this applicant into your unit. Tenants with a history of evictions, a negative criminal record should automatically be considered potentially risky tenants. Thankfully, these obvious red flags will show up on a good tenant screening report.

  • Bad Credit- An applicant’s credit history is a record of their dedication to fiscal responsibility. If a potential renter has bad credit, you may assume that their debt obligation can make their ability to pay rent in a timely fashion difficult.

  • Past Evictions- Tenants with multiple evictions should especially not pass your criteria. Evicting a tenant is a cumbersome--if not costly--process.  If another landlord or manager went through the trouble to legally evict a tenant, that means tenant has a history of rule-breaking behavior and you will likely deal with the same issues. This means you likely will have to evict the tenant which can put you at risk of losing rental income.

  • Criminal Record- According to the Fair Housing Act, landlords may not have a blanket policy that denies all applicants with a criminal record. However, landlords can legally deny an applicant based on their criminal record if their past crime demonstrates a lack of respect for property or safety of your current residents.

 

Hidden Warning Signs Landlords Should Look For

While you may know to look for the obvious red flags when screening an applicant, there are some more subtle indicators that your would-be tenant may not be ideal. Here are some hidden warning signs of which to be aware:

  • Application or Screening Complaints: A good tenant will likely assume that there will be some form of a screening process. If an applicant complains excessively about providing personal information to move forward, may be concerned that you will uncover a disqualifying issue. Likewise, experienced renters understand that credit checks are part of the rental process and credit is only verified with a social security number. Don’t be moved by a tenant’s request to skip any part of the screening process; good tenants understand a landlord’s need to verify employment, credit, and references.

  • Application Errors or Blank Areas: Future tenants should be ready to stand out above the rest by treating your application process much like a job application. A misspelled street name or inaccurate reference phone number can demonstrate negligence but it could also be an attempt to mislead a landlord. A careless tenant could prove to be a liability.

  • Constant Movers: With the cost and effort of tenant turnover, finding a qualified long-term tenant is the dream. Keep this in mind when reviewing your applicant’s moving history. Applicants that have more than 3 previous addresses in the past 5 years should warrant further investigation. Are they hard to please? Is it difficult for them to hold a steady job?

  • Overqualified: If applicants’ income is far over the 30% ratio that is ideal, you may find that they could turn into short-term tenants. While a tenant with a fabulous credit score, great rental history, and a high income could seem like the dream tenant for which you have been looking, it is likely that they could break the lease early as soon as they find a home to purchase themselves. Just be sure to check your local laws regarding first-come first-serve rental policies

  • Former Address: If an applicant is claiming to currently be living with a family member, this could be cause for a second look. It’s not unheard of for people with poor rental histories to stay with family members or use them as a landlord reference. It’s true that there might be legitimate reasons for an applicant to claim they are currently living with a family member, but do consider the possibility that they are attempting to hiding the true identity of their past landlord.

 

Looking for red flags is a necessary part of the tenant screening process, and could serve to prevent you from accepting a tenant who could cause problems down the road. However, it is crucial that during your interaction with any and all applicants, you are strictly conforming to regulations outlined by the Fair Housing Act, and are not accidentally breaking fair housing laws.

 

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