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Previous landlords.
I know some around here do a credit check, not sure its a real true indicator but its used quite often in this area.
No use getting refrences from friends, hell anybody can come up with a few friends to vouch for them.
Doug
Just telling people that they have to go through a credit check weeds out a lot of 'em.
First-time landlord?
Third time. My first I got someone with impecable references and the second was hand picked by my realtor.
This third house I got an app from a questionable prospect. As it turns out simply calling a previous landlord gave me all I needed.
Some court systems you can do a search to see if they have been plantive or defendent in a civil case.
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A-holes. Hey every group has to have one. And I have been elected to be the one. I should make that my tagline.
Just found that out today. I called the city and they were kind enough to do that over the phone.
Interesting what people will tell you with a simple phone call.
I've learned to ALWAYS verify employment ! When I'm trying to eliminate undesirables, I'll ask for TWO former landlord references and TWO credit references. They always walk away, don't call back, whatever.
Greg
I'll ask for TWO former landlord references
Had to think about that a second. I couldn't have done that very well, back when I was renting--legacy of having rented the same place for more than a decade. I'd outlasted about 12 landlords and six "managers" (2 on-site).
But, as the others have already said, just asking will likely weed out 80% of the ones you want to weed out.Occupational hazard of my occupation not being around (sorry Bubba)
That was one of the red flags. I only had one previous reference for housing and this person was at their present address 7 mos.
I had to search to find a number for the one previous she did provide.
Remember to check the most wanted ads at the Post Office. ;)
With young adults who are starting out, references could include such people as a scout leader, sports league coach, church leader, college/trade school instructor, high school principal...
In a smaller city or town, most of those will probably work. I went to a suburban high school with 2300 students at the time of my graduation. The principal lived one street west of me and one house north. He wouldn't have known me if I bit him on the...errr...if I walked up and said "Hi, my name is...". I had a potential renter fill out an application and her mom was married to a guy I grew up with. His mom came over and told me that the girl was really nice, great person, etc. I got the app back and Holy Hand Grenades! Not a single good credit history. OTOH, the one I rented to had a great credit history. Unfortunately, she doesn't know how to vacuum, dust, not yank doors off of the hinges, remove aluminum foil after broiling, which then caught fire when her husband baked a pizza and smoked up the whole place but never told me, etc. The area for her cats was cleaner than the rest of the place.
"I cut this piece four times and it's still too short."
Edited 9/20/2007 6:22 am by highfigh
There are services you can get that will do checks for you. When I did it they could charge you yearly or a one shot deal. On your rental agreement you have places for them to give their info. SS #, bank accounts ( to check for bounced checks), you name it they give it to you. That info goes to the agency that verifies it. you can have the agency check for all sorts of stuff if you are willing to pay. the more stuff they check higher the price. You can also legally make the tenant pay for the verification fees if you have the right paperwork and it is legal in your area. There are also landlord advocate groups out there that can help. It's a good idea to join one or attend meeting/ seminars. That's what I would do if I got back into it. Learn the ins and outs of it from someone who thinks like a lawyer.
Tennessee's Government website offers a Tennessee Bureau of Investigation background check for approx $30...
you might choose your state's site first.
Troy Sprout
"A free people ought not only to be armed and disciplined, but they should also have sufficient arms and ammunition to maintain a status of independence from any who might attempt to abuse them, which would include their own government."
-- George Washington
Look in the phone book for renter's referral companies. Some will do criminal, credit and rental history checks. There are some online, too. This link is for one of them:http://www.rhol.org/rental/default.asp
Call your city hall and ask if they have landlord training. It's in the city's best interest to have good landlord/renter transactions, too. Happy landlords generally keep their property in better condition, which keeps the area from looking like a war zone, which keeps the property values up, which brings in more tax revenue, lets the landlord keep the rent higher and usually gets better tenants, who spend more in the community, etc.
What you charge for rent is kind of like playing chicken. If everyone flinches, you're probably asking too much. If the area has specific problems, like drug houses, talk to the other landlords nearby and find out how they do things, how much they charge, and what to look out for. Some of them will be helpful, some might not be but it can't hurt to ask around.
First rule- protect yourself. You took the risk in buying the property and if you're not careful, someone else's carelessness or lack of consideration for you and your property can take it away. Learn all you can about the legal aspects of owning a rental property. Talk to the IRS- they will give you a lot of helpful information, even at crunch time (April 15th).
past landlords was good
employment history was better
getting out of rentals entirely was best
Okay, so what do you do for asset income now?
Thanks to all. I didnt realize there are so many landlord types here. Almost looks like we could use another subject folder here.
all my money is now invested in coffee cans strategically located in the backyard
Seriously though. Had a rental property for a number of years, and recommend it for those with the patience to stand by it. Unfortunately this is a college town, which means a lot of competition for often times questionable renters. Good renters are a dream and make you want to do anything to retain them. Bad renters are a day-by-day nightmare, which is what eventually made us sell.
My own experience was that past rental history was good, but not always accurate. Many multi-unit operations are removed from the actual renters, and only process the checks. In addition, unless someone went out of their way to be horrible, they would get a glowing review. I found employment history to be a better indicator. Not so much what they made, but how long they were employed, if they were a good employee, etc.. The relationships tended to be more personal and the answers covered the aspect of responsibility, which is really what you want to look for. A good tenant who pays less rent is far better than a bad tenant who pays the top price for an area.
Oh, yeah . . . how could I forget ? Check out their RIDE. What they drive tells a lot about them. And how they take care of it.
Greg
I think that past landlords are by far the best way to screen. I usually only need to ask if they paid their rent on time, if they cared for the property,and if the landlord would rent to them again. However, I prefer to not put too much emphasis on a current landlord as he may see a chance to get rid of a problem.
As other have mentioned, an application form eliminated most of the bad apples immediately as they see you are serious about checking on them.
Good luck.
I always used the "would you rent to them again?" question with former landlords, but a rental agency told me in one instance they would. Come to find out when i took the renters to court for damages, it came out that the rental agency had had to bill them for repainting as the 'art' student had seen fit to redecorate the walls and ceilings. Anyway, i'd not put a lot of weight anymore on a rental agency vouching for a former tenant. I knew when i saw the climbing rope hanging off my brick chimney those renters weren't going to be staying much longer...
cal current landlord, employer and have them get their FICO score -- Cost $8 and then decide -- do the work now and you will not hav eto do it later
Don't get me started... oops- too late...Here in San Francisco, landlording is a dicey business. We used to pay $25 for a credit check through the Apartment Association. Now, in order to run a credit check, we must adhere to a strict set of record-keeping guidelines. We are required to pay for an inspector to come and visit our "office" to verify that we are securely storing the Rental Applications in such a way that insures the privacy of the applicants' financial data. We are required to keep all applications for no longer than two years, at which point we must shred the documents. This is understandable, except for the fact that prospective tenants have 3 years to sue us for discrimination. I could go on...Now, we just ask applicants to provide their own credit report, which is readily available to them via the internet. We also call all their references, but a Landlord reference may not be as accurate as you assume- if a Landlord gives someone a bad reference, even if accurate, they are opening themselves up to a lawsuit. We once had to evict a tenant-from-hell- one of the terms of the settlement was that we had to give him a good reference to the next landlord- poor guy! If a tenant is bad, it's in the landlord's best interest to give him a good reference so the tenant will leave.
Bill
a $25-$50 processing credit check fee... will weed out 99% of your deadbeats...
i do have a form that they sign with their deposit that allows me to check their credit... i have 3 business days to either refund the deposit or to tell them they can move in... I also let them know i deposit the check first...
btw... i never do deposit the check... i do run a credit check thru a friend who has a retail store that sells on credit...
i only have 1 duplex left... everything else i have now is retail/office /warehouse space... which is a different deal...
p
After 25 years of doing tenant checks ourselves we now pay a company $35.00 to do them for us and we require the prospective tenants to pay. They sort of legitimize themselves if they are willing to pay.
Past landlords, credit check to make sure they can get the utilities turned on and verify the job. I don't care whether they have good credit or not. Frankly if they do the don't last because they soon go buy a house anyway. DanT
This is a topic on which I have given a great deal of thought. Here is where I currently stand:
First of all, know your legal climate. Laws and practices vary greatly from place to place. There is something to be said for hiring a management company to do the 'grunt work.' If nothing else, it removes you from the line of fire ... both legally, and in the event a bad guy seeks revenge.
Secondly, it does matter the scale of your operation. Laws, and their application, typically will be different for the little old lady renting out her basement, than they will be for Mega-Rent, with a 1000 apartment complex.
As for screening procedures, I have seen them all .... and I cannot say any of them work any better than a wide-awake owner following his own 'gut' instinct ... and willing to follow through if he's been fooled!
Probably the best approach is one that is also the hardest ... take the initiative, and recruit specific tenants. That is, keep track of folks you meet that strike you as suitable, and have their lives in order. When the time comes that you have a vacancy, approach them.
Don't forget the element of risk in any business. There is nothing wrong with charging a higher rent, or asking a larger deposit, from unknown folks - than for, say, someone who you know has their act together.
For the last point, let me give an example that I have near me:
A new landlord bought a duplex. One half had been the local dope house; the other half had been rented for years by a steadily employed (if poor) person. Due to the lease, the "low" rent of the existing tenant was somewhat protected.
It was decided to rent the vacant half for maybe 20% more than the existing tenant was paying. Naturally, this could be done only after a considerable investment in fixing up the former dope den. Mr. "Working Man" next door had taken it upon himself to maintain his half, so it wasn't in critical need of attention. The repairs translated into several months before the vacant half could be rented.
Fast forward four years: The owner is still unhappy that the 'grandfathered' tenant is paying so much less than the the other half. Sure, he is ... IF you look at the monthly rate. If you also consider the vacant periods while the 'expensive' half has not paid rent (or rent was in arrears), however, the "cheap" half has actually paid the owner 30% MORE rent .... and without costing the owner a dime in repairs or cleaning!
The moral of the story is that a stable tenant is worth money - and they ought to see that reflected in their own rents.
Slightly off topic, but worth repeating here.Build your late fee into the rent. But offer a discount if paid early.Much easier to collect the "late fee" if it is build into the rent and people will fight to pay early and get the discount..
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A-holes. Hey every group has to have one. And I have been elected to be the one. I should make that my tagline.
I agree. I'd rather have a steady tenant that takes care of the place than a parade of losers that might pay more but destroy the place.
http://www.youcheckcredit.com
their program tells you whether the tenant is good or bad...
Once again thanks to all for the advice. I'm sure i'll be asking for more advice as time progresses.