Protect your investment by conducting a background and credit check of prospective tenants. Tenants with a history of not paying their rent, which are evicted in the past, or have a criminal record are more likely to behave badly. Landlords have the to certainly review credit reports and conduct background checks when screening prospective tenants, however the Fair Credit Reporting Act requires landlords that you follow proper procedure when performing so. Tenant screening companies that accomplish background checks for a fee will show you if applicants pay their rent punctually, have damaged previous rental properties, have criminal history records, and how they were rated by previous landlords.
Require all prospective tenants to fill a rental application form. This manner will provide you with the necessary information to carry out a background and credit check. Request current contact details, what they are called and addresses of current and previous landlords and employers, ssn, driver’s license number and banking account numbers for credit check needed.
Include a credit file authorization form together with the rental application. Section 604 on the Fair Credit Reporting Act mandates that landlords ask permission before you run a credit check. Of course, a landlord can deny a consumer the ability to rent when they does not wish to authorize a credit assessment. Landlords, not the financing reporting agency, have the effect of requesting and recording credit check authorizations.
Run a credit file for your applicants effortlessly three main credit scoring bureaus: TransUnion, Experian and Equifax. Credit history will tell you about your prospective tenant’s credit score: foreclosures, bankruptcies, unlawful detainer lawsuits, evictions along with credit-related public record events. They may also provide you that has a credit score for each applicant. However, the credit rates the financial robustness of the consumer; the higher the score better.
Hire a tenant screening company to do a background check on your applicants. A credentials check can include a situation and national criminal report, a sex offender database search and prior address history verification. Tenant background checks may cost anything from $20 to $50, with respect to the thoroughness of the investigation.
Contact your applicant’s current and previous landlords to request for references. Call the actual employer to confirm income, and question other references to ensure the information provided within the application form is correct.