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How Do I Approve a Tenant… A Property Managers Perspective

One of the most important aspects of property management is how we qualify a prospective Tenant.  What are the steps I go through and how can I ensure that I am selecting the best possible Tenant for the Owners home?

First is the application.  We require a completed application before all showings…    This is an article I wrote as to why we require a completed application before all showings…    https://www.erarents.com/2019/08/06/showing-procedures/      Once the application has been submitted and the Tenant has viewed the home, the next step is to verify all the information on the application if it’s something the Tenants would like to rent.  What we do is run a credit check, a criminal background check, verify income and employment and do what is called a Tenant Resident History check (TRH)…   The TRH is when we actually speak with former Landlords about the Tenants payment history, how the Tenant took care of the past rental, would they rent to the Tenant again and were there any issues while they lived in the property.  In some cases I will even take a quick ride by their current residence to see first hand how a prospective Tenant lives…

Now when it comes to the credit check we are not looking for a specific credit score.  What I look at is what is the Tenants past payment history on items such as their car payment, credit cards, cell phones, cable and internet service, any unpaid balance they may owe to a past Landlord, and Evictions.  Now if we see there was an eviction, it is our company policy to reject the application.  We cannot rent to a Tenant that has an eviction in their past.  But what we can work with is items such as foreclosures, bankruptcy, student loan debt and medical debt.  These items will not get the application rejected.  We look at the application as a whole and no one item outside of an eviction will get it denied.

The criminal background check, well that speaks for itself…

When it comes to verifying income and employment we ask that the applicant provide copies of their most current check stubs and we will actually speak via phone and email to the applicants employer.  We ensure that the income level that was reported on the application is correct with the employer itself.  Some of the questions we ask is how long has the applicant been employed…  Do you expect the applicant to be employed long term…   What is their current position, etc….

One of the questions I get often is how much do I need to make to qualify for the rental?  What we do is take the rental rate and multiply it by 2.5…   If that number is less than the total gross monthly income of all the adults applicants, you qualify.

Example :   If the rental rate is $1000 a month, multiply $1000 x 2.5 = $2500…  If your gross monthly income is higher than $2500 you Qualify!!!   But if you make less than $2500 a month, you will need to find a less expensive rental to qualify income wise…

Now, with that being said qualifying a Tenant is not an exact science…  I have been a Property Manager for almost 12 years and I get surprised from time to time.  We do all we can to ensure we are selecting the best possible Tenant for your home and with regularly scheduled inspections most issues can be handled before they turn into a problem.  That’s why it is so important to hire a Professional Property Manager such as myself to ensure your getting the best possible management for your investment.

As always just give me a call at 352-314-1544 or email me at glenn.cowham@gmail.com if I can answer any questions…

Until next time…

Posted by: Glenn Cowham, IV on September 2, 2019
Posted in: Uncategorized