So you've met your ideal tenant, but when their application comes in, you start to worry that they've oversold their value. How do you know when your gut feeling is just that or a reason to deny their application?
A tenant criminal background check and screening process can help you identify red flags before inviting a low-quality applicant into your community. Here are five of the most common warning signs to look out for.
1. Income Inconsistencies
It is always a good idea to require applicants to make a monthly income of at least three times the unit's monthly rent. That's because industry statistics have found tenants making less than this are more likely to be evicted.
Knowing this trend, prospective tenants may lie about their income on their rental application. Always verify income with paystubs. If the numbers don't match up, that's a sign to move on.
2. Eviction History
An applicant who moves frequently and can't give you a justifiable reason for doing so may be reason for concern. At the very least, the tenant may not stick around for long, impacting your vacancy rate.
At most, moving often may indicate multiple evictions. It is not easy to get evicted. A tenant with a history of being kicked out of past rental units may be a lease agreement violator or consistently late on rent.
3. A Low Credit Score
A low credit score often indicates financial irresponsibility. The most common reasons someone might get dings on their credit report include failing to pay off credit cards, missing loan payments, or failing to meet rent obligations.
Of course, a low credit score does not always mean the applicant will fail to pay rent. Other factors like credit utilization, short credit history, and too many recent credit inquiries also go into determining someone's credit score.
4. Fake References
You should be careful if a prospective tenant only lists relatives as references. Ideally, applicants should only include people unrelated to them, such as former landlords, their current employer, or a work colleague.
But it is an even bigger red flag if you realize an applicant's references are fake. Always follow up with references to ensure the applicant has given you valid phone numbers of real people who can verify their rental history.
5. Criminal History
It is illegal to deny an applicant residency based on criminal history alone. There is one exception. That is if the prospective tenant has a conviction that could put your property or other tenants at risk.
Examples of criminal charges that may allow you to deny an applicant and avoid breaking the law include but are not limited to sex crimes, drug-related crimes, and violent crimes that occurred within the last five years.
Tenant Criminal Background Check and Screening
A tenant criminal background check and screening process can help you avoid red flags like evictions, criminal histories, or a low credit score. It can also help you weed out applicants with fake references and income inconsistencies.
Do you need help with your tenant screening process in Austin, Texas? Austin Property Management Services helps residential and commercial rental property owners in Austin and surrounding areas.
Contact us today to learn more about our expert tenant screening services to find responsible tenants!