|How to Screen Tenants in 5 Easy Steps
I always say that "95% of your tenant problems can be eliminated in
the screening process." If you're like me, you probably find it
difficult to relax when you have vacancies. So getting it rented is
the main idea, right? Well, from now on, lets say "getting it rented
to a properly qualified tenant is the main idea."
Below is what I call The 5 Steps of Screening Tenants.
STEP 1: First Contact
From the very first contact with the tenant, the screening process
has begun. Whether you are the landlord, real estate agent or property
manager, the same still holds true.
First Contact is usually by telephone, so you need to ask the right
qualifying questions in order to decide if you should proceed to step
2. Advise customers of your up front rent and security deposit
requirements and other important facts regarding the rental that may
help disqualify the prospect.
I suggest you make a list or prospect card of questions to ask and
have it handy while you conduct your first contact interview. For
|Reason for Moving:
||# of People:
|# of children & Ages:
Please note that anyone who has a problem answering your questions
(as long as you ask them politely), probably will not qualify for your
rental. Serious customers want to make a good impression on you and
should be happy to answer your questions. This process can save you
and customers a lot of time and trouble.
STEP 2: Showing the Property
From landlords to real estate agents, we all have our own style in
showing the rental. I think we all need to be aware of certain
telltale signs to watch for while evaluating your prospective new
- 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.
- 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.
- 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.
- Criticizing the property. Are the prospects
pointing out legitimate concerns, or are they trying to come up with
items to negotiate price?
- 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
The first thing you need is a quality rental
application. Let the applicant know that his or her application
will be considered along with others, and you will notify the
applicant once a decision is made. Advise the applicant(s) that it is
very important to fill out the application as completely as
possible. If you (and I recommend you do) run a credit
report on the applicant, I suggest you be sure to collect a
screening fee. This is a provision in the The LPA Rental Application.
Inform your 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". When you are satisfied, you
will proceed to approving your new tenant in step 4.
STEP 4: The Approval Process
This is usually a fun part, but keep in mind that you are still
screening the applicant while preparing him or her for the next
step. 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. (Check*, money order or cash)
* Be sure to tell your new tenants that possession or keys will be
given only after checks have cleared.
STEP 5: The Lease Signing
It is very important that you have a quality residential
lease. You'd be surprised at how many people would just sign a lease
without reading it! And I don't just mean tenants! I believe it is
crucial to read the entire lease with the tenants at a lease
signing. It is your agreement with them. Shouldn't you both know what
is really being agreed to? As you read the terms of the lease with the
tenants, you will be able to conduct your 5th and final
step of screening. Does the tenant argue on every item? Is the late
charge an issue? And so on.
Of course, if you are unhappy with how your prospect responds to
you and/or your lease, you must not rent to this person. I believe: "It
is better to have NO tenant than it is to have the wrong
tenant." - John Nuzzolese
John Nuzzolese is a licenced Real Estate Broker / Real Estate Investor in Nassau County, NY. where
he resides with his wife and 3 children. John has been involved with real estate sales, rentals and
investing since 1979. He owns two real estate businesses and is also President of a national
organization for landlords, The Landlord Protection Agency, Inc.
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