The entry to barrier to every property rental is the rental application. Without it, you can’t even get past the front gate. Everyone knows that. But are you as the landlord or property manager asking the right questions of your applicants? Are you gathering all the right information to be able to make the right decision on selecting the perfect tenant? What’s this rental application process look like?
Rental Application in a Nutshell
Essentially, a typical rental application will consist of the applicant’s financial information and rental history, in particular, you’ll have the applicant fill out the following:
- Applicant’s Name and Contact Information
- Applicant’s Present Address
- Verification of Prior Addresses
- Rental History
- Work History
- Credit Score and Report
- Criminal Background Check
- Income and Present Financial Position
- Personal Reference
Once the prospective has submitted his or her application, the landlord has the right to further screen his applicants. This entails running a full credit check and criminal background check to validate if what the tenants had specified in the application is true. Now, at this point, there are two ways to deny a tenant. First, if the application does not align with the credit report or criminal background check, the landlord can decline the applicant. Further, if an applicant falsifies on his application and was found out at a later time that he did so, he could be evicted, if he had entered a into lease contract. Second, the applicant can be declined if you deem his financials, credit score, or references do not meet your standard of expected tenant fiduciary. However, under the Fair Housing Law, you cannot do is reject your applicants solely on their race, nationality, ethnic background, religion, gender preference, family status, age, and or disabilities. Prohibiting smokers or owners with pets do not fall under this category.
Going Through Rental Applications
If you’re in the process of going through the applications, keep in mind how people present themselves in person. During the in person interviews, gather as much information about their personality as you can, such as their body language, the firmness of the handshake, his punctuality, and perhaps other social cues. Listen and take note of the specific questions asked about the rental unit as this will often suggest their interest level in your rental property.
Rental Documents You Need To Check
In their application, you will need to ask for their personal information, such as name and contact information, who they’ll be living with, spouses, kids and perhaps any pets they’re living with in their present property. Also, you need to ask for their permission to run a credit check as this goes back to screen the tenants. With this, you need their Social Security number and a photocopy of their driver’s license.
To get proof that the applicant is capable of paying the rent on time, you’ll need to ask the prospective renter’s bank statements and their recent pay stubs. As a rule of thumb, if the monthly rent amounts to more than 1/3 of the applicant’s income per month, then he or she may have trouble paying on time.
You also need to verify your applicant’s employment history – you’ll need to check how long they’ve been working in their present work, their salary, and whether the job status is active. Applicants, who move from one job to another or have a hard time holding a job should raise a caution flag. Of course, this comes down to whether you think the tenant is credible and the only way to do that is to check their personal and work reference.
But perhaps, the most important piece of information you need other than the applicant’s rental history, is the phone number of their previous landlord. And so there’s really only one question to ask of the previous landlord and that magic question is – “Would you rent to this person again?”. “Yes or No?”