Tenants come in all different types: some are good, some are bad; some are charming, others can be a downright nightmare. As a landlord, you’re very familiar with the relationships you need to maintain with your tenants. And while you can either love them or hate them, you have to admit that without them you wouldn’t have an income.
Choosing the right tenant to rent your property is important because it will protect your investment, so the screening process is absolutely essential. In the hopes of helping your long-term investment run as smoothly as possible, we asked landlords around the country to share their trade secrets.
“Finding the right tenant doesn’t mean you get to play favorites. The Federal Fair Housing Act is there for a reason, and you must always follow its rules. Not following the rules of the act could result in accusations of discrimination, and that’s bad news for you. Race or color, national origin, religion, sex, whether or not the family has children, or disabilities are all factors you cannot discriminate on. Also, be sure to check with the specific rules for your state. State and local laws can vary when it comes to Fair Housing Rules, so be sure you are up-to-date to avoid any trouble.”
“Good credit goes a long way.”
“This should go without saying, but always choose a tenant who has good credit. Would you really want to rent your investment to someone who isn’t financially responsible? If a tenant has a lack of responsibility, they won’t take your investment seriously, and your hard work will be wasted.”
“Verify the tenant’s income and net worth.”
“It wouldn’t be wise to rent your property to a tenant who can’t afford it, so it is important to verify their employment and income. Normally, a tenant’s income should equal at least three times the monthly rent, so be sure to ask for copies of pay stubs to make certain they can afford the rent without any problems. If you so choose, you could take it a step further to call their employer directly to confirm employment, length of employment, and their attendance.”
“The tenant’s rental history is important.”
“When it comes to the rental history of your potential tenant, you need to know if they have a good track record. I recommend speaking with at least two of the tenant’s previous landlords, since personal grudges can interfere with the truth. Getting more than one opinion can help paint a better picture of your tenant’s rental history.”
“Ask all the important questions, leave nothing out.”
“I always resort to the classic go-to’s for rental interview questions, but don’t hesitate to add in some questions of your own. You should always ask potential tenants questions such as these:
“Ask if they have any questions they’d like you to answer.”
“Allowing your potential tenant to ask you questions is important, but is often forgotten about. The tenant has answered all of your qualifying questions to your satisfaction, so now you should give them the chance to satisfy their curiosity about the property, location, screening process, or anything else that comes to mind. Doing so will promote comfortable communication and will establish a great relationship between landlord and tenant.”
One last tip: don’t forget about Sherman Bridge.
When you decide to become a landlord, sure, you are taking a risk. But, as the saying goes, with risk comes reward, and you’ll reap what you sow. Sherman Bridge works hard to help you make informed investment decisions, and have great resources to help you succeed.
We make it simple to fund your real estate investment, and Sherman Bridge’s loan products made to give you the greatest ROI. Our rates end where others begin, and we work fast for our investors. You can be pre-approved in just 30-seconds, or receive full-approval in only 30-minutes!
With Sherman Bridge, your investment success is just around the corner, what kind of financing rate will you get? Receive your free personal preview in just a few clicks.