You’re faced with a vacant unit and someone has responded to your website or online ad. You’re anxious to close a deal.
Not so fast.
As tempting as it is to quickly sign up this prospective renter, you shouldn’t shortcut your due diligence process. Spend the time now to determine if this person is right for your unit, rather than dealing with potentially more serious problems down the road.
To start, here are five questions you should ask first of the prospective tenant:
- Why are you moving?
Legitimate reasons include needing more room or changing jobs. Answers like being evicted or inability to get along with a landlord or neighbors obviously raises concerns. Request references from a former landlord. Their current landlord may not be as forthcoming since they may be more interested in having the tenant leave. A former landlord will be more open to discussing their behavior and the reasons for leaving their unit.
- What is your employment status?
You want to know their monthly income to ensure they can afford your unit. A good rule of thumb is that income should be 2.5 to 3 times your rent. Ask them for an employer reference to provide documentation from their employer to verify their salary and job stability.
- How is your credit?
You need them to agree in writing to a credit and background check. This will help you determine their overall debt situation and their payment history. If they fail to agree to those requests, you should eliminate them from consideration. You should also ask if they are prepared to pay the security deposit and first month’s rent up front.
- Who will be living in the apartment?
You shouldn’t allow more than two people per bedroom. Obviously the fewer people, the less wear and tear and less chance of possible disruptive behavior that could affect your other tenants. If you have a no pet policy, you should clarify that at this point.
- Do you have any questions?
Now is a good time to allow your prospective tenant the chance to ask questions about the unit, the neighborhood or any other concerns they might have. Your goal is to acquire a long-term tenant, so if there is something that could stand in the way, it’s best to address it now.
Tenant screening services, which are integrated with web-based property management software packages like those offered by AppFolio, can help you find the right tenant. Conducting a thorough investigation can be time consuming, but if you end up with the right tenant, the time will have been well spent.