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Tenant screening guide: Finding ideal residents

posted on June 24, 2024 in first time renting

Great tenants make all the difference if you’re a landlord. A responsible, respectful tenant will consistently pay their rent payments, cause minimal property damage, and ensure a smooth overall rental experience. But how do you spot ideal residents in a large pool of applicants? This guide walks you through tenant screening, helping you find the perfect fit for your property.

Step 1: Define your ideal tenant

Before diving into applications, take a step back and write down what you're looking for in a tenant. We typically look closely at our applicants’:

  • Financial stability: We seek tenants with a gross monthly income that is at least three times the monthly rent.
  • Rental history: A history of on-time rent payments and no evictions is optimal.
  • Occupancy plans: We examine how many occupants the tenant wants in the unit.

Step 2: Pre-Screen potential tenants

Craft and publish a rental ad that clearly outlines your property's features, rent price, and any specific requirements for tenants such as no pets, quiet etc. This can help attract ideal applicants from the outset.

Step 3: Gather applications

Once you have interested applicants, provide a detailed rental application form for them to complete. This should include:

  • Basic information: Their full name, contact details, social insurance number (for background checks).
  • Employment details: Employer contact information, income verification.
  • Rental history: Previous addresses, contact information for past landlords.
  • References: Personal and professional references (with permission to contact).

Step 4: Conduct essential checks

After you gather all the applications, it's time to conduct some key checks:

  • Credit check: A credit report outlines the potential tenant's financial history, including debt and payment patterns. Look for a history of responsible credit management.
  • Background check: This report can uncover criminal records, evictions, and other red flags.
  • Verification of employment and income: Contact the tenant's employer to confirm their employment status and income. 

We use a tool called VeriFast to screen our tenants. It is a secure means of verifying tenants' and borrowers' financial ability to pay.

Look for red flags

When you examine applications and checks,watch for these warning signs:

  • Poor credit score: A low credit score shouldn’t automatically disqualify someone from your consideration, but it warrants further investigation into their financial situation.
  • Gaps in employment: Large unexplained gaps in employment history could indicate financial instability.
  • Eviction history: An eviction can be a significant red flag, especially if recent or due to non-payment of rent.
  • Bad references: Negative feedback from previous landlords can reveal issues with rent payment, property damage, or disruptive behaviour.

Step 5: Do a gut check 

Background checks and verifications are crucial, but don't discount your gut feeling. Pay attention to the communication style, punctuality, and overall demeanour of your applicants. Are they respectful, responsive and clear? That matters!

Follow fair housing laws

You must comply with fair housing laws throughout the screening process. These laws prohibit discrimination based on factors like race, religion, national origin, sex, familial status, and disability. Focus on criteria that directly impact a tenant's ability to pay rent and maintain the property.

Step 6: Do your part to build a positive relationship

You have to do your part to build a positive relationship with your tenants. Be sure to:

  • Clearly communicate: Provide a copy of the lease agreement outlining the tenant’s responsibilities and share your contact information for any questions and follow up.
  • Conduct a thorough move-in inspection: Document the property's condition with photos and a written report signed by both parties so you get off on the right foot.
  • Be responsive: Address any tenant concerns promptly and professionally. This creates trust and keeps communication flowing.

By following these steps, you will find it easier to find your ideal residents. We hope it helps you locate respectful tenants who will take good care of your property and make your experience as a landlord more positive. 

Looking for a new apartment to call home? Panoramic Properties would love to welcome you home. Please visit our website to browse our available apartments.