Tenant Screening - Keyrenter Property Management Silicon Valley

How to Spot Red Flag Tenants

The tenant screening process is important for a reason. When a tenant brings up red flags in the screening process, it is possible that they will cause substantial issues. Evictions are often one of the most expensive processes that landlords face. Learning how to spot red flag tenants can help you to minimize the likelihood of these issues occurring.

Incomplete Applications

You need to require tenants to fill out applications. This can help you to find red flags when they arise. If a tenant hasn’t completely filled the application, they either haven’t followed the directions or are purposely withholding information.

Low Credit and Eviction History

Though certain things can be explained, the credit report and eviction history of a prospective tenant tells you a great deal about their habits. Multiple evictions are a huge red flag that the tenant will likely be problematic. You also need to verify the income of applicants. If they can’t afford to rent your property, it is extremely likely that you won’t receive regular rent payments.

Objecting to Background Checks

Background checks are fairly standard for tenants looking to rent a property. When an applicant objects to a background check, it is likely that they have something to hide. This is a huge red flag that indicates a problematic tenant. If they aren’t hiding anything, they shouldn’t have any problem with you completing a background check.

Lack of References

References help you to get a sense of the character of the applicant. If they don’t provide you with references, you won’t have that resource. It is also important to ensure that you contact all the references. Efficient tenant screening helps you to minimize the likelihood of evictions, which can substantially improve the way your rental property operates. Watch out for these red flags to help weed out potentially problematic tenants. To learn more about common red flags, contact our experts at the Keyrenter in Silicon Valley today!

Are You a Target for Bad Tenants?

Whether you own and operate residential income properties independently or are one of the leading property managers in Cupertino, bad renters are among your greatest concerns. After all, a bad renter can be the difference between turning a profit and going into the red. This industry tends to put great focus on how to avoid these renters, but if you regularly find yourself dealing with such tenants, then you need to ask yourself what you’re doing to make yourself a target. That may be just another perspective on the same conversation, but it’s a way of looking at this problem that can help illuminate why you continue to attract the exact kind of renter you don’t want.

Marketing Your Residences to Good Renters

When property owners and property managers in Cupertino are regularly attracting bad renters, their mistakes usually begin with how they’re marketing their properties. Whether placing ads online or in local publications, the medium you choose dictates the kind of tenant you attract. You may find the best tenant you’ve ever had from the local free flyer, but such flyers will often make you susceptible to serial bad tenants and people looking for a quick solution until they can be where they actually want to be. The medium is important but so is the clarity and the crispness of the message. Photographs and accentuating community amenities are very important in this regard, and you should strive to present the property as one that’s likely to be gone by the time the reader makes the call.

Start with an Application

An application is an initial step in the process that will eliminate a lot of bad renters right out of the gate. In fact, serial bad tenants who target inexperienced landlords will often abandon their efforts once they realize an application is involved. When a person is willing to complete an application, it not only provides much of the information you’ll need to complete the vetting process, it gives you greater insight into that person. A person who took the effort to be neat, thorough and concise is likely that way in other avenues of life. A person who gives you an application that’s hard to read isn’t necessarily a bad tenant, but that’s certainly a warning sign you’ll want to pay attention to moving forward.

Set a High Bar

Even a property management company in Cupertino property management can make the mistake of setting the bar too low. Many landlords are wary of application fees because they fear that they make the property less appealing. However, application fees eliminate most bad tenants from the word go and thus save you a lot of time and therefore money over the long-term. Likewise, you never want to set the rent, security deposit and other terms too low. Doing so can actually drive good tenants away since it seems too good to be true, and that makes you susceptible to the bad eggs.

Follow Through on a Comprehensive Vetting Process

Another common mistake novice landlords make is not following through on a complete vetting process for prospective clients. First impressions may matter, but they can also be quite deceiving. After the prospective client submits the application, review it closely. More importantly, follow through on the references. References are an area where many landlords are lax and set themselves up for failure. Many bad tenants actually lie on their applications and provide nonexistent phone numbers and the like. Also, demand actual landlord references rather than employee and character references.

Demand All Residents Be on the Lease

Not having restrictions on residents is another reason some landlords are prone to poor renters. Demand that everyone who lives in the home be listed on the lease. Even minors can be listed without being on the lease in a legal sense. Furthermore, demand that any new residents be approved and added to the lease through the same vetting process discussed above. Any oversights in this area can allow good tenants to turn bad because you let your guard down once they’ve moved in.

Send the Right Message Starting with Day One

In that spirit, it’s also essential that you send the right message on move-in day and continue to send it over the course of the occupancy. A great way to do this is to provide new tenants with a move-in package. Since we know most tenants don’t read the full lease, you can include colorful documents that provide bullet points about various topics, such as parking, pool usage and pet ownership. Furthermore, alert tenants to any rule changes with similar documents that you hand deliver to them.

Appearances Matter

The way you present your properties to prospective tenants sends a message. If the lawn, for instance, is beautifully manicured, then that not only makes the property more inviting but sends the message that this is a landlord that cares and pays attention to detail. If you take a relaxed approach to the upkeep of the property, then any tenants who live there are likely to do the same. This is solid wisdom in all walks of life: If you want someone to behave a certain way, it starts with leading by example.

Nurture a Business Relationship with Your Tenants

Finally, the relationship between you and your tenants is a business relationship. You have to establish it and nurture it. To not do so is to invite all kinds of difficulties. You should be friendly with your tenants, but never lose sight of the fact that you’re not their friends. Some landlords have great difficulty maintaining this kind of relationship. They’re simply not that kind of person. That’s OK, but if that’s you, be honest with yourself about that and hire a professional who can maintain that arrangement.

Why Tenant Screening Is Important?

I always get questions from new landlords on how to screen tenants. Finding the best tenants for your property is a necessity that will save you headaches down the line. I wanted to share some helpful tips for tenant screening that will help you pick quality renters for your property.

The tenant application process

All renters have to progress through a set rental application process. The applicant should present a photo ID (like a driver’s license) for identity verification. The applicant will also need to consent to a criminal background check. I prefer to ask the applicant some questions as part of the application process. My belief on finding good tenants is that I want to get a well-rounded sense of them and whether they’re going to be a good tenant. I also charge a refundable application fee. The fee is a nominal amount of less than $50. This is a small hurdle that helps bring in more serious applicants and keep out the window shoppers.

How to screen tenants

• I always talk to the current or prior landlords of the applicant. I like to ask the current landlord if there’s been any trouble with the tenant (like noise complaints from loud parties) and whether they expect to refund the tenant’s security deposit.
• I verify the tenant’s job. If self-employed, I want to see regular income deposits showing up on bank statements.
• I check if the tenant has had any evictions. If they have a checkered rental history, I will avoid them. But if they’ve only had one eviction, I might dig in further and see what the circumstance was.
• I always run a credit report on the tenant. The tenant’s debt ratio is something I like to keep an eye on. Someone who is maxed out on their credit cards is not making sound financial decisions in their life.

How to protect against falsified applicant information

I occasionally get the tenant who falsifies information. The easiest things for a tenant to falsify are their past landlord references.
If they falsify their prior landlord’s info, I can verify this by calling their currently listed landlord. I’ll ask questions like how much is rent, what’s the location of the property and how long has this current tenant lived there. I always want to ask them these questions to make sure the landlord knows who lives there and that we’re both talking about the same person. I also suggest that property managers visit the county treasurer website for the most up to date property information. Another way of verifying the address is to look for the current address that’s listed on the tenant’s utility bill.

Another issue that property managers in Campbell sometimes deal with is faked income documents. My number one goal as a landlord is to make sure my that the rent gets paid. That’s essentially what the tenant screening process does: it helps the landlord separate who is going to pay rent from the people who are more likely not to pay rent. I can’t make a proper assessment of a tenant’s risk if I’m not getting good employment or income information. If the tenant does falsify their employment situation, one way I combat this is to ask for some of their current pay stubs. Another effective method for verifying a tenant’s employment is to simply call their employer. This allows me to find out employment length and some other information myself.

Evictions are black marks against a tenant’s reputation as a good renter. If a tenant has an eviction, they’ll likely try to bury it in some way. If they are not able to bury it, they might resort to lying about it. If a tenant attempts to hide an eviction, I’ll either call up their previous landlords or find the evictions myself using civil records.

I also am very wary of the underreporting of the number of occupants that a tenant will bring with them. This is a common occurrence to deal with for a property management company in Campbell. Property management managers should always ask the prior landlord about who exactly was living at the residence.

There are some other warning signs as a property manager that I’ve learned to sense throughout the years. One warning sign I’ve learned to trust is my gut reaction to a client. I always like to look for clues as to whether or not they’ll be a good tenant. Are they anxious or eager to sign the contract without even looking at the property? That would be a red flag for me. In general, if a tenant wants to skip some part of my application process just to close a deal, I’m going to take a step back and assess the situation. I always want to follow a set checklist and will never skip steps just to close a rental agreement.

Tenant screening is a tedious process that’s well worth the amount of effort. Tenants can cause major headaches for you as a property owner. If you don’t focus properly on screening your tenants, you might have to worry about paying for evictions from your home or dealing with bounced checks. Every landlord wants stable long-term tenants, and following a set tenant screening protocol is how you get great tenants.