From the very first communication with the tenant, the screening process begins. Asking the right questions during a phone call can save you a great deal of time by screening out problem applicants. There is no reason to waste your time driving to show a unit to someone who will not qualify.
Advise applicants up front of rent/security deposit requirements and other important facts regarding the rental that may help disqualify the prospect. Example: The rent on this unit is $650 a month and there is a $650 security deposit payable in cash or by guaranteed funds. We do criminal, credit and background checks. Will that be a problem for you?
The first contact is usually by telephone, so you need to ask the right qualifying questions in order to decide if you want to set up an appointment to show the unit. Make notes during the conversation to attach later to their application form if they fill one out or to keep in file as to why you did not set up appointment. Try to not ask yes/no questions but rather get them to talk. Frequently they will say something they shouldn’t and disqualify themselves. Ask questions like the following:
¢ What is your name, phone number and current address? With this information you can quickly check if they have ever contacted you before and if you disqualified them for some reason.
¢ What kind of work do you do? Follow up with who is your current employer? if they haven’t already told you. Watch out for self employed. If they are self employed, ask if they can provide their most current 1040 and bank statements to corroborate income.
¢ What is your credit score? If they don’t know their credit score ask if they know if they have good credit or bad credit. You will verify this information when you run the credit check.
¢ How many people will be staying at the property ? If more than the number of allowed people, tell them you are sorry but only X number of people are allowed in that unit and they will need a unit with X number of bedrooms. Now if we just happen to have a unit of that size open, mention it.
¢ What kind of pets do you have? Asking the question like this will usually generate a more truthful answer than asking do they have pets.
¢ Are you a smoker? Does anyone who will be staying with you smoke?
¢ When are you looking to move? A tenant that is looking to move immediately probably is being evicted.
¢ Why are you moving? If they talk nasty about previous landlord chances are they are a problem. If they talk about bugs chances are they have roaches. If they talk about mold they are definitely a problem
¢ How long are you planning to stay? Long term are definitely preferred
¢ When I contact your previous landlords what will they say about you? Surprising how many tenants will admit to not being a good tenant.
Make a list or prospect card of questions to ask and have it handy while you conduct your first contact interview. Index cards are good for this. For example:
¢ Reason for Moving:
¢ Number of People and Relationship to You:
¢ Intended Rental Term:
¢ Occupancy Date:
¢ Credit: Landlord Reference?
Anyone who has a problem answering your questions probably will not qualify for your rental. Genuine applicants want to make a good impression on you and should be happy to answer your questions. This process can save you and them a lot of time and trouble.
Confirm the features and address of the property and have them do a drive by before making the appointment. If they do not like the location or the neighborhood, there
is no sense in spending time showing the unit.
STEP 2: Showing the Property
Telltale signs to watch for while evaluating your prospective new tenants.
1. Appearance. Is the prospect neat and clean? Did he or she make an attempt to make a good impression? In most cases, an unkempt person keeps an unkempt lifestyle and home.
2. Car. Does the prospect have a nice car? Is it clean? Although we can’t judge people by their car, we should take note of it along with other details.
3. Attitude & Manners. Does this prospect behave respectfully? Does he or she show indications of being difficult to deal with in the future? Did the prospect wipe his or her feet when stepping into the house? Did the prospect walk into the rental while smoking? You can learn a lot about people even before speaking to them. Sometimes it helps to pay attention to details.
4. Criticizing the property. Are the prospects pointing out legitimate concerns, or are they trying to come up with items to negotiate price?
5. Yes or No? Can the prospect make the decision now or will they have to think about it? If they know now that they want your rental, did the prospect come ready to give you
a deposit and fill out an application?
STEP 3: The Application Process
Let the applicant know that his or her application will be considered along with others, and you will notify the applicant if we decide on them. Advise the applicant(s) that it is very important to fill out the application as completely as possible. Inform prospective tenant that the application must be returned as soon as possible to avoid the risk of losing the rental to a competing prospect.
Review and verify the application thoroughly and look for inconsistencies and “red flags”. Before they leave check to see that their application is readable. Absolutely, you need to be able to read their name, address, phone numbers, SS number and employer name.
STEP 4: The Approval Process
¢ Set a minimum income requirement as a multiple of the rent. We are comfortable with gross income at three times the rent.
¢ Credit Rating: Consider a minimum score, a minimum of late pays, income to rent ratios.
¢ Length of time at job. I consider six months a minimum.
¢ Prior tenancy information, especially a talk with the prior landlord.
¢ Maximum number of allowable occupants. State Law may differ from Federal law. Know what is permissible in your area. [A safe rule of thumb is the two plus one rule. Two people for every bedroom, plus one.]
¢ Eviction filings: I will not consider anyone with an eviction in the last four years.
¢ Bankruptcy filings: Consider a time frame, perhaps a bankruptcy three or more years ago with good income and good payment record is reasonable.
¢ Earnings: Get two recent pay stubs and file with the application.
¢ Self employed: Ask for the most recent IRS 1040 and bank statements to corroborate earnings.
¢ Are there any areas that need clarification? Check the present address.
¢ How is their overall credit rating? Establish a minimum score and stick to it. Remain objective for all applicants.
What did the previous landlord say about the applicant? This is your best source for a character reference regarding how they lived among their neighbors and how they left the unit. Do they have any judgments or collection items on their credit?
Questions You Can Ask Prior Landlords
¢ Confirm that the prospective tenant did live at that address and confirm the dates.
¢ Ask if the owner/manager knows why they left.
¢ Ask whether they gave 30 day proper notice of intent to leave.
¢ Was the security deposit returned in full?
¢ Were any 3 day or 30 day notices ever posted during the tenancy.
¢ Were the Police ever called due to complaints?
¢ Would you rent to the tenants again?
I like to congratulate the applicant on being approved and let them know they came in 1st place. Also, let them know if you made any special concessions just for them, such
as overlooking minor credit infractions, etc.
This process is also an opportunity for you to make sure the applicant can and will deliver. Set the time, date and place for your lease signing. Instruct the applicant(s) to
bring the proper amounts of monies, identification (if you don’t already have it), and how you prefer to be paid. (money order or cash).
Be sure to tell your new tenants that possession or keys will be given only after utilities have been turned into their name and lease is signed.
Oh – one last step. Also – I try to do my lease signings at a local restaurant near a Staples or place where I can make copies. I hear some people bring a small copier with them. But at a restaurant we can have a soda, go over each point and have a nice table to work on.
STEP 6: Move- in Checklist, Walk-through and Possession Transfer.
Provide a move-in/out checklist. After the lease is signed, and before I actually give them the keys we return to the property. I verify that there is power, water, etc. I show them the mailbox, test the key. Show the main water shut offs, the electric panels (which are clearly marked as to circuit). Go over any quirks of the property. We go over the condition of everything and sign the move-in checklist form.
At this time I usually video tape and still photo the property, making sure to get pictures of the tenants. My camera (which is a high end semi-pro Sony) has a feature where while I am filming I can also take digital stills and save them to a SD chip.
Then after all this, I give them the keys, and we test them together. Then I say goodbye and try to stay out of their lives until inspection time.
Nothing worse than giving the wrong keys, or having a quirky lock and getting clear across town only to receive a call two hours later when the tenant arrives with their first
load of furniture and the door won’t open.
Reprinted with permission.