Finding Your Perfect Tenant Tips on effectively finding and screening qualified tenants, while ensuring your process is efficient, thorough and legal to get the best tenants for your rental property. Finding Your Perfect Tenant Table of Contents Table of Contents Table of Contents What Does the Perfect Tenant Look Like? ............................................................................................................ 2 Do Tenants Lie on Rental Applications? ............................................................................................................... 4 How to Choose the Best Tenant Screening Company .......................................................................................... 6 The Best Landlord Guide to Charging Rental Application Fees .......................................................................... 12 What Information is on a Tenant Background Check? ....................................................................................... 15 Information Needed for a Tenant Background Check ........................................................................................ 17 How to Do Landlord Verifications: The Right Way ............................................................................................. 19 What is a Good Credit Score for a Tenant? ........................................................................................................ 21 Should Landlords Get a Background Check on a Tenant’s Spouse? ................................................................... 23 Can Landlords Ask Tenants if They Are Married? It Depends! ........................................................................... 25 Tenant Won’t Give Social Security Number: New Normal or Huge Warning Sign? ........................................... 28 What to Do If an Employer Refuses Verification of Tenant’s Employment? ...................................................... 30 Requirements for Employment Verification for Tenant Screening .................................................................... 32 Dismissed vs. Discharged Bankruptcies on Tenant Background Checks ............................................................. 34 Judgments on Tenant Screening Reports ........................................................................................................... 36 Quick-Start Guide to Understanding Rental Security Deposits .......................................................................... 38 How to Deny a Rental Applicant Based on a Tenant Screening Report .............................................................. 40 ©2013 Fidelis Screening Solutions | Page 1 Finding Your Perfect Tenant What Does the Perfect Tenant Look Like? What Does the Perfect Tenant Look Like? Most landlords know all about the tenant screening process but what happens when the roles are switched? Recently, my fiancée and I moved from San Diego to Newport Beach and I was put in this situation. Since we weren’t familiar with the area, we wanted to rent a place first before we thought about buying. I had already rented out my condo in San Diego a month prior so the tenant screening process was fresh in my head. As a landlord, I know exactly what I would want to see from a potential tenant so I tried to emulate that. Be Professional On our first day of apartment hunting, we looked at 8 different properties and most of them were pretty disappointing. We only ended up applying to one property and the next day the landlord called us to tell us we got the place! I think your first impression is of utmost importance when you’re renting a property. For each one of our appointments, we made sure that we arrived early and looked professional. This may seem like two very simple things but you would be surprised how many people don’t do this. Our biggest advantage came by way of our employment. Since I was an engineer and my fiancée was also employed (soon to be starting med school), our income was very ©2013 Fidelis Screening Solutions | Page 2 Finding Your Perfect Tenant What Does the Perfect Tenant Look Like? secure and probably made us stand out compared to others. They actually mentioned how excited they were to have a doctor and an engineer as their tenants. I know you can’t always control your employment situation but the better job you have, the more likely you’ll be to get the place. References if Needed I actually printed out copies of my free credit score, credit report and prior year’s W2. Most landlords will do their own credit/background check but having yours on hand can’t hurt. The landlord that we ended up renting from was very informal, and she didn’t even require an application fee. I’m not sure if they called my previous landlord (from four years ago) but he was also a friend so I knew we would get a great reference there. And since the process was so casual, I didn’t offer up any of the information we’d brought along. Instead, all we did was fill out our applications and before I even had the chance to follow up the next day, we got the apartment. There are a lot of factors for landlords to consider but ultimately it all comes down to your income stability and past references. Things like punctuality and neatness won’t make or break your application but they definitely can’t hurt. As a potential tenant, you want to do everything in your power to secure the property in question. It might be a little more work to take care of all the secondary stuff but in the end it will strengthen your overall application and give you the rental of your dreams. Harry Campbell is the founder of yourPFpro.com, a site dedicated to educating people beyond a basic knowledge in personal finance. He graduated from UC San Diego with a BS in Aerospace Engineering and his investment experience includes stocks, real estate and managing rentals. He believes that “the key to personal financial happiness is finding a balance between saving, working and spending on the things you enjoy.” ©2013 Fidelis Screening Solutions | Page 3 Finding Your Perfect Tenant Do Tenants Lie on Rental Applications? Do Tenants Lie on Rental Applications? The Answer: Yes It should be no shock that on any given day we catch people who lie on rental applications. In 2010 Fidelis Screening Solutions created a report that gave landlords and property managers a better perspective of a tenant’s rental history background. The premise for the idea was that a database can’t tell you if the person was a bad neighbor or makes less per hour than they implied on the application. The information provided in the Fidelis Character Report is what screening companies have been missing all along. So we’ve heard from landlords that is. Professionals Can Help Fidelis Screening Solutions provides this product through its corporate site FidelisScreening.net and its landlord site RentPrep.com. ©2013 Fidelis Screening Solutions | Page 4 Finding Your Perfect Tenant Do Tenants Lie on Rental Applications? The report has Certified FCRA Screeners making phone calls to current and previous landlords asking questions such as: Has the renter ever had late or partial payments during their lease term? Are there any noise complaints on file? What is the condition of the property? Has the renter ever had late or partial payments during their lease term? Thorough Checks The character report also includes a screener making a phone call to the applicant’s employer. Questions asked in this portion of the report include, “Length of employment”? “Is the applicant full or part time”? “How many hours are guaranteed a week”? Again, the screener will verify the number to the employer and will not accept a verification from someone that gives a cell number of their supervisor. If this is the case, the screener will find the company’s contact information and verify employment from there. Weed Out Bad Information This product is available as an add-on feature for its corporate clients and to all its landlord clients through the RentPrep.com Platinum Report. Turnaround time for this product is 24 hours. This is due to return calls from either the landlords or employers. All attempts made are time stamped with the exact time of the call and date. Whether it was a message left on a machine or with a person, the entire conversation is posted for the client to review. Steve White is the co-founder and CEO of RentPrep, the landlord division of Fidelis Screening Solutions which provides tenant screening and background check solutions to landlords and property managers. Outside of the office, he can be found enjoying the outdoors and coaching his son's ice hockey team. ©2013 Fidelis Screening Solutions | Page 5 Finding Your Perfect Tenant How to Choose the Best Tenant Screening Company How to Choose the Best Tenant Screening Company When choosing a tenant screening company, it’s important that you learn as much as you can about their tenant screening procedures, or lack thereof. Being in the credit and background screening industry for years, I wanted to share a few trade secrets in aiding you in your search for the best tenant screening company. I’m going to answer some of the most common questions we get asked every day, such as: How accurate are tenant screening reports? How much is a tenant background check? What should I look for in a tenant screening company? ©2013 Fidelis Screening Solutions | Page 6 Finding Your Perfect Tenant How to Choose the Best Tenant Screening Company Beware of Any Tenant Screening Company Claiming to Have the Most Accurate Reports