How To Screen Potential Tenants

Tags: knowledge broker, knowledge broker real estate, toronto real estate, newmarket real estate, new homes, new condos, investment property, screen tenants, tenants rights, potential tenants

Every landlord knows how hard it is to find good tenants. Tenants who you can pay their monthly rent on time, maintain the property and respect their neighbours. Renting to a bad tenant can cause you consistent financial and structural problems. In that case, you need to ensure you are thoroughly screening all potential tenants. Here are the 5 steps you need to properly screen tenants.

Provide Them An Application

Step one is providing prospective tenants with an application form. Your real estate agent will most likely be able to provide you with a sample rental application that you can use or modify to fit your needs. Your application should include financial information, employment information, and personal information such as marital status, family size, or the number of pets. You need to also provide a section that lets potential tenants consent to you running a background and credit check, and checking their financial, employment and personal history.

What to Look For On the Rental Application

Once a tenant has returned the application there are a few things you should note as they might explain what kind of tenant they will be.

Current and Previous Employers: If a tenant has had multiple jobs within the last year or if they are currently unemployed it could suggest that they are not reliable, and they do not have a consistent income. If they have been with the same employer for over a year it shows they have consistent income, loyalty and probably a good reference.
Personal Information: Do they have a large family, a partner, or a pet? It is important to note if the number of occupants would fit the space and the lifestyle of the unit. For example, if the tenants have a newborn baby and the neighbours are all young, they might not be the right tenants for the unit.
Financial Information: How many credit cards do they have? Have they ever gone into overdraft? Have they ever taken out a loan? Are they currently in debt? These are all important things to find out from their financial intuitions.

Run A Credit and Background Check

Now that you have a tenant’s consent to pull a credit and background check, do it! A credit check with show you details about the tenant’s previous credit history. Using Equifax or TransUnion you can pull a credit check for about $20. You can also use a website called TVS that is a nationwide service that offers a full credit profile, credit scores, and a criminal background check. You can also use social media platforms like Instagram, Facebook and Twitter to check what kind of people your potential tenants are.

Contact Previous Landlords and the Tenants Current Employer

In their application, the potential tenants should have provided you with a list of past landlords and past or current employers. Contact previous landlords and inquire if the tenant owes any outstanding debt, did they have a history of late payments, did the tenant cause any damage to the unit, and would you rent to the tenant again in the future? When speaking to a tenant’s employer, the most important information you are looking for do they have a reliable income source. You can also inquire more about the tenant’s personality.

Interview the Tenant

If you are satisfied with the information you have gained, conduct a face to face interview with the potential tenant. You can ask them questions about the information you have been given or ask questions about their hobbies, day to day activities or habits such as are they a smoker. As they answer the questions look at their body language and how they maintain eye contact. Treat this as you would if you were interviewing a potential employee.

It is important to say that under the Ontario Human Rights Code, it is illegal to refuse a property because of a person’s race, colour, ethnicity, religious beliefs, ancestry, sex, family status, sexual orientation, disability, marital status or age. The bases of your screening must be on the merits of potential tenants. If you need any help finding and screening potential tenants, please contact us for assistance.

At Knowledge Broker, our goal is to create an open-source of information for all our clients. We want to ensure that, at the end of the day, they get exactly what they want and what they need. If you know someone who could use our help or services please put them in touch with us or send us their details using the contact information below. And before you go, click here to take the Knowledge Broker Quiz and see exactly what we can do for you!

JOSHUA CAMPBELL (@knowledgebrkr)
Real Estate Broker
Coldwell Banker The Real Estate Centre, Brokerage
j oshua@knowledgebroker.ca
249 Avenue Road • Newmarket, ON L3Y 1N8
289.231.0001