Tenant screening needs to be far more robust than running a simple credit check.
When you think about turning the keys to your valuable investment property over to someone you’ve only just met, it can feel a bit unnerving. Deliver yourself some peace of mind and protect your rental property by conducting a thorough screening so you get a good idea of who is actually moving into your home.
You’re looking for a resident who will pay rent on time every month.
You’re looking for a resident who will help you take care of the home.
You’re also looking for someone who will follow the terms of the lease agreement, communicate openly, and partner with you to enjoy a pleasant and stress-free rental experience.
Finding that tenant requires careful screening.
We know it’s not terribly easy for independent Marin County landlords to get through the screening process with ease. You may not have the resources, tools, or the background to effectively screen tenants. You may not understand the fair housing laws that are easy to trip over when you’re screening a tenant.
Partnering with a Marin County property management expert can help deliver a well-qualified, carefully screened tenant.
Here’s how we do it at Giuliani Property Management.
Complying with Fair Housing Laws While Screening Tenants
Before we get into the logistics of how you should screen your tenants, we want to stress the importance of following all federal, state, and local laws when it comes to digging into the backgrounds of your applicants and making decisions about who you will accept and who you will deny.
California’s Fair Housing Act is stricter than the federal fair housing laws. You cannot discriminate against rental applicants on the basis of race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, marital status, national origin, ancestry, familial status, military service, source of income, disability, or genetic information. Understanding and adhering to these protections is essential.
Fair Housing Do’s
- Create Clear Criteria. Establish a transparent and consistent set of criteria for tenant selection. This could include credit score minimums, income requirements, or rental history. Make sure these are applied consistently across all applicants.
- Use Formal Applications. Always use a formal, written application process. This ensures that every applicant provides the same information and is screened based on the same criteria.
- Keep Detailed Records. Document your interactions with potential tenants and the reasons for any rejections. These records can be crucial if you need to demonstrate that your screening process complies with Fair Housing laws.
- Reasonable Accommodations. Be willing to make reasonable accommodations for applicants with disabilities, such as allowing a service animal in a no-pet building.
Fair Housing Don’ts
- Don’t Ask Discriminatory Questions. Avoid any questions about race, religion, familial status, or other protected classes. Even if these questions are well-intentioned, they can be construed as discriminatory.
- Don’t Make Assumptions. Don’t make assumptions or decisions based on stereotypes or biases. Treat all applications with impartiality.
- Don’t Be Inconsistent. Every applicant should go through the same screening process. Be wary of ad hoc or informal methods that might result in inconsistent treatment of candidates.
- Don’t Ignore Privacy Laws. Respect the privacy of applicants. Securely store any personal information and do not share it improperly.
Adhering to fair housing laws is not just about avoiding legal problems; it’s about providing equal opportunity for all Marin County residents who are seeking housing. You want to be fair, and you want to follow the laws. Make sure you understand them.
Good Tenant Screening Starts with the Application
Before you even begin screening your potential tenants, you have to collect all the information you’ll need on an application. Make sure you’re using an application that gathers all the pertinent details and grants you permission to check backgrounds and credit history. You’ll want to collect an application from every occupant who is an adult, 18 years or older. Make sure you’re using an application that’s been approved by an attorney or a Marin County property manager.
Provide your applicants with a written list of your qualifying criteria before they turn in the application and pay the application fee. This is a documented set of standards that applicants must meet to be approved for your property. It might include:
- A minimum credit score
- Minimum income level
- No prior evictions
By sharing your rental criteria ahead of time, you’ll ensure your applicants know whether they’re likely to be approved before they apply. It also helps you keep the process free of any bias.
Remember that there’s a state-mandated limit to what you can collect as an application fee in California. For 2024, that limit is $60.02.
Thorough Screenings: What to Look For When Choosing a Tenant
We take tenant screening very seriously at Giuliani Property Management because we know that the right tenant will have a positive impact on your success with your rental property. We focus on a number of things, including credit, income, and rental history.
- Running Credit
You need to place a tenant with good credit and a record of paying bills on time and meeting financial obligations. Some of the most important things to look for in a credit report include whether housing payments have been made on time, and if there are any judgments or outstanding debts owed to other landlords or apartment communities. You don’t want to rent to someone who is in collections with all the local utility companies.
- Verifying Income
You need to establish some standards for income when you’re screening tenants. Best practices in Marin County property management say that you’re looking for applicants who earn a verifiable monthly gross income of three times the amount of rent.
Rents are high in Marin County, and you want to verify that your prospective tenants will be able to meet that threshold. Call employers or ask for pay stubs. You can also collect an employment contract or look at deposits with bank statements. For self-employed individuals, ask for tax returns that show annual income.
It’s important that your tenant earns enough money to pay your rent. One of the best ways to avoid eviction in the future is by knowing that your tenants earn enough money to cover the cost of housing and other living expenses.
- Search for Past Evictions
The credit score is important, and income is also important, but one of the most essential criteria you can establish is whether or not you’re willing to consider a tenant who has been evicted in the past. We recommend that you conduct a nationwide eviction history check.
For us, any eviction is a red flag. We do not recommend renting to a prospective tenant who has an eviction on their record, especially a recent eviction.
- Evaluating Rental History
The best way to understand your prospective tenant’s rental history is by talking to current and former landlords. Make sure your application asks for their contact information and grants you permission to contact those landlords. Verify that you’re talking to the property owner or manager; tenants with something to hide may try to provide the name and phone number of a friend. Once you know you’re talking to the right party, ask if the tenant paid rent on time while living there, if they took care of the home, and if they followed the terms of your lease agreement. Always ask the landlord if they’d be willing to rent to that tenant again.
Conduct In-Person Showings
We understand the popularity of self-showing technology. It’s convenient. It’s easy. It saves a lot of time, especially for busy landlords and tenants. While we appreciate the availability of such technology and we invest in a lot of our own tech, we believe that the personal touch is very important when it comes to leasing, marketing, showing, and screening.
We like to be present for showings. We like to meet the potential tenants in person. Not only does it give us the opportunity to answer any questions and provide additional information, we also get to talk with these tenants. We can find out why they are moving and when they want to move in. This helps us to establish a good relationship with future tenants.
These are some of the best tips and strategies we can provide to owners of rental property who are preparing to screen and choose a tenant. We’re a local Marin County property management team that prides itself on providing personal, customized property management to first-time landlords, experienced real estate investors, and rental property owners in any situation. We know how important screening is. If you need help finding a good tenant, contact us at Giuliani Property Management. You’ll love working with us.
