As a landlord, having a proper and effective tenant screening protocol is beyond important. After all, your tenants will be the ones occupying your asset throughout the duration of their lease. We need to make sure that we take any steps possible to avoid unnecessary issues that could very well arise due to poor tenant screening.
Assuming that you are renting to a stranger, we need to ask the right questions to make sure that we have any information needed from this prospective tenant. Here are some questions to ask so that we can find somebody who’s a proper fit for your rental.
Why are you moving?
Although this may seem to be a basic question that won’t present too much information about your tenant, it is important and will give you insight around the situation that they are in. We know that moving can be stressful and expensive, so it’s safe to assume that your prospect has some reason of significance for relocating.
Maybe they need to downsize, maybe they’re looking to be closer to family or maybe they simply no longer want to be in the situation they’re currently in. Their answer to this question will be a big help in determining whether or not this tenant is a good fit for your property. And of course, if you can tell or if you discover that they lied about their proclaimed reason of relocation through due diligence, this is a massive red flag.
What’s your income look like?
Yes this is a straightforward question, but it is one that you must know the answer to. It’s non-negotiable. In order for you to sustain a profitable rental portfolio, you need to know that you can rely on your tenant to get that check to you every month. It’s up to you how much wiggle room you deem acceptable, but it’s a safe rule of thumb to avoid bringing in a tenant that will need to spend more than 35-40% of their monthly income on rent.
How long have you been at your current address?
As a landlord you of course want to have tenants who are in it for the long term. Having reliable, stable tenants will make your life as a real estate investor much easier. If you are speaking with a potential tenant who has lived at their current address for less than a year, you need to find out why.
Do you have pets?
For many investors, whether or not a potential renter has pets can be the deciding factor to that renter's eligibility or ineligibility. The restrictions you’d like to apply regarding pets in your rental properties (if any) are up to you, but regardless, you need to have the discussion around these restrictions and any pet deposit or additional fees you apply for pet ownership.
Conclusion
Doing everything in your power to ensure you’re bringing in ideal tenants will make your life as a real estate investor easier on a day-to-day basis. Your tenant screening process and the questions you ask are the most important part in doing so. You still need to do your due diligence and further research to the best of your ability, you can’t always take the answers you get at face value.
If you have any questions about the real estate investing process, reach out! We love talking to fellow real estate investors in the Orlando area. We’ve helped countless people find rental properties in Central Florida and we’d be happy to help find your next deal as well.
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