Tenant Screening in Grand Rapids: Best Practices for Qualifying a Good Renter

May 7, 2021 | Owner Education, Property Management Education

Finding a well-qualified tenant for your Grand Rapids rental property requires more than a credit check. You need to take the time to match the information provided on the application with the information you uncover during a thorough background check.

If you’re not sure how to screen tenants, consider working with a Grand Rapids professional property management company. We have the systems and procedures in place to ensure well-qualified residents are placed in your rental home. We also understand the fair housing laws, which can be difficult to navigate, especially during the screening process.

Here are some of the industry best practices to follow when you’re screening applications.

Establish Qualifying Criteria

Before you begin to hand out applications and screen tenants, you need to decide what you will and will not accept in terms of financial standing, criminal backgrounds, and rental history. Create a written set of qualifying rental criteria and use this to screen every application consistently. Not only does this protect you against unintentional discrimination and fair housing claims, it also lets your prospective tenants know whether they have a good chance of being approved for your property.

Once your potential applicants have reviewed your standards, provide an application. This will collect all the information you’ll need to do a thorough screening and it will also grant you permission to talk to former landlords, employers, and run criminal and credit checks. Every adult occupant 18 years of age and older needs to fill out an application before the screening process can begin.

Check Credit and Eviction Records

Most rental property owners don’t want to rent their property to someone with prior evictions on their record. Always check the national eviction database, and include eviction standards in your qualifying criteria. An eviction from 25 years ago might be fine if the tenant has had an otherwise positive rental history since then. But, a series of evictions or recent situations in which a tenant was removed from a property might be a good reason for a denial.

Check credit as well. Look for outstanding debts or judgments that are owed to former landlords, property managers, or apartment communities. A good tenant doesn’t have to have perfect credit, especially with all the financial challenges people have faced recently with the pandemic, but you want to be wary of any unpaid utility or housing-related bills and collections. Use the credit report to make sure all current and former addresses are correct on the application. Everything should match up.

Tenant Criminal Background Checks

Conduct a nationwide criminal background check. This may turn up evictions in other states as well as felony convictions that may disqualify someone from renting your property. Be thorough and check things like sexual predator lists and terrorist watch lists.

Verify Employment and Income Information

You want to be sure your tenants can afford to pay the rent on time every month.

The best way to do this is to verify the employment information that was listed on the application. You can call employers, or if the tenant hasn’t started a job yet, ask to see an employment contract or an offer letter. Check income by asking to see recent pay stubs. If your applicant is self-employed, you can look at tax returns or bank statements.

The standard best practice is to require at least three times the monthly rent in income. So, if your property is $1,200 per month, you’ll want tenants who earn at least $3,600 per month.

Checking and Verifying Rental History

Your application should ask for contact information for current and former landlords. Take the time to contact these landlords so you can get an idea of the experience they had with the people you’re considering renting to. Find out if rent was paid on time, if any property damage was left behind, and if the tenants followed the terms of the lease agreement. Ask if they gave proper notice before moving out and if they had any pets. Confirm the dates of residency and the amount of rent that was paid.

Tenant Screening in Grand Rapids Best Practices for Qualifying a Good RenterThese are some good starting points when it comes to screening potential tenants. For more information or for help in leasing your Grand Rapids rental property, please contact us at Short South Realty Group.