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Every landlord dreads the proverbial bad tenant. You’ve probably heard horror stories about tenants who disappear without paying rent or who trash the rental and can’t cover the repairs. The solution is a rapid eviction, but this process is easier said than done, and you’ll still be left with costly repairs at the end of it.
As you get into the process of filling your rental, here are some ways to avoid getting the worst tenants.
Screen Your Tenants Thoroughly
Tenant screening is the oldest trick in the book for avoiding destructive or irresponsible renters. During this process, you learn detailed information about the applicant and their past run-ins with landlords. It gives you a much better idea as to whether or not you should give a prospective renter a roof.
A tenant background check may vary depending on who’s administrating it, but it usually involves checking for a criminal record, presence on the sex offender registry, eviction history, and previous landlord references. You can learn a lot from that last point.
One of the most important aspects of any tenant screening is the financials. You’ll want proof of income and employment history, and you should run a renter credit check. The habits recorded over the last few years say a lot about the kind of tenant you’re dealing with.
Charge the Right Rent
Competitive rent tends to bring in competitive renters. A rent which is too low indicates that you lack confidence in your property and are willing to settle on any tenant. If it’s too high, good tenants won’t be interested because they know they can find a better price. Or, even worse, it attracts tenants who don’t care how high the price is because they don’t plan to pay up.
Evaluate market conditions carefully, and select a rent price that’s not too high or too low. Once you’ve determined the right price, market it prolifically, and screen tenants to make sure they can pay it.
Be Picky on the Application
The Fair Housing Act (FHA) declares that you’re not allowed to discriminate on basis of race, sex, gender, disability, or other factors beyond the tenant’s control, but you can still be picky about which tenants you approve based on the application.
You can easily find and download a standard rental application template for free. If there’s something specific that you’re concerned about, such as the presence of pets or certain income requirements, make sure that’s on the application.
Meet Personally First
Online applications make many aspects of renting easier. Those moving from a different city can fill out an application without going out of their way, and landlords can process applications faster. However, it also allows a tenant to hide certain things about themselves.
Make it a priority to meet any tenant face-to-face before handing over the keys. Tenants can lie on their applications, but it’s harder for them to maintain that lie when you’ve met with them personally. Ask questions and get to know the tenant better before signing off.
Check Your Emotions at the Door
When you’re just starting out, it’s easy to make the classic mistake of being too compassionate. It’s hard to tell when your tenants are being honest about their situation or lobbing you a sob story. In some cases, the sob story may be true, but it’s an indicator of more trouble than it’s worth down the road.
Compassion is an excellent trait to have as a human being, but it will get you into trouble as a landlord. You have to protect your investment, and that often means leaving your emotions out of the decision-making.
Bad tenants can creep out of the woodwork, so it’s important to have your defenses up at all times. Landlords who employ these steps regularly have fewer problems and more success with their tenants.