Empty properties aren't making you any profits - they're burning money.
And the longer you wait, the more the price tag goes up. Property taxes, maintenance, and listing fees aren't cheap.
The good news is that a tenant background check will save you a headache or two and keep your properties generating cash for longer.
Don't worry if you haven't run a background check before. Read on to learn to fundamentals and understand why they're crucial for successful landlords.
Background Check 101
It pays to verify who you do business with.
Tenant screening involves three elements before signing a lease and handing over the keys to your property:
- Employment history
- Credit check
- Criminal records check
Verifying that a tenant has good credit and solid employment history is a vital first step in choosing the right tenant. That's how you know they'll be on time with their rent payments, as well as being able to keep up with market demands.
While it's illegal to flat-out refuse a prospective tenant with a criminal record, knowing what's in their past is important. Ultimately, you'll decide on a case-by-case basis who to permit and who to pass over.
Why a Tenant Background Check Isn't Optional
Employers are critical of unexplained gaps in employment history. And just like employers, unexplained red flags are a warning of bad things to come if you sign a lease with the wrong tenant.
Improved Turnover Rates
As a landlord, the tenants you want to rent your properties are long-term renters.
By letting your tenants know you íntend to perform a background check, you'll weed out those who aren't serious in favor of those who are. And knowing your tenants can pay on time, every time reduces the number of evictions in the future.
Liability Insurance
Landlords are liable for their properties. While you are not responsible for everything a tenant does, a background check insulates you against lawsuits for negligence if the worst comes to pass.
Reputation Management
As a property owner, you have a reputation to manage, and it's important in two ways.
Your personal reputation influences the types of tenants you attract, the caliber of partners you work with, and the quality of investors you charm. Low eviction rates and exemplary tenants show the world you know what you're doing.
What's more, the type of person you rent to affects the value of those properties and surrounding neighborhoods. Better tenants mean potentially more lucrative rental agreements further down the line.
Peace of Mind
Managing your real estate is work - but it doesn't always have to be hard work. Knowing your properties are in safe hands leaves you free to focus on other aspects of your career as a landlord.
Peace of mind is something you can't put a price tag on.
Verify Your Tenants
Running a tenant background check can be the difference between a happy relationship and an empty property. It might draw the process of filling a property out for longer - but in the long run, it means less downtime between signed rental agreements.
If you are a real estate owner in Orlando, our talented real estate experts screen tenants and manage properties so you don't have to. Click here to book a call and find out how we can help you.
