How to Choose Tenants that will Help to Boost your Rental Business

In the rental business, selecting the right clients (tenants) is the most crucial part of being successful; for, if you rent your place to a wrong tenant, there is very little you would be able to do to make up for the loss. Good tenants are the ones that keep your premises in good shape, pay their rents on time, adhere to guidelines if any and behave well with the neighbors or fellow tenants.

With a few checkpoints and careful scrutinizing, your chances of getting to the right tenants go significantly up. You may use the following 6 steps to efficiently choose tenants.

1. Interact Personally and Telephonically With Prospective Tenants

Inter-personal interactions are a great way to figure out if one would be a good match to your requirements. Ask them about their family size, pets, rental history and preference in terms of the neighborhood. Try to get to know as much as is necessary to help you decide, without coming across as intrusive, else, it may backfire on you and you may lose a good tenant.

2. Contact Some References like Previous Landlords

Previous landlords and neighbors can give you information about the general behavior of the tenants, whether they pay rent on time and left the property in an unharmed condition. A tenant who has a consistent record of late payments is likely to repeat the same behavior and you must be extra careful in renting your place to someone like that.

3. Check Credit Scores

Poor credit scores are a red signal; those laden with debts may find it difficult to make timely payments of rent despite their income being up to the mark. Credit histories will also tell you about the bill clearing records of the prospective tenant – minor delays here and there should not worry you, but consistent delays should.

4. Verify That Their Income is Sufficient to Afford the Rent

Monthly incomes of at least three times the rent amount are desirable. If the interested party’s income falls below the mark, check for other things like debts and credit scores as well before you make a decision.

5. Make Sure You Take a Security Deposit

However rosy things seem in the beginning, you cannot completely rule out the possibility of any future trouble. Security deposits of at least a month’s rent amount are a good practice for all property owners.

6. Check for Criminal Records if Your Instincts Inform You of Something Dicey About the Prospects

You can get access to a person’s criminal record with their name and date of birth from the state and county courthouses. Therefore you need to check a valid ID to ensure you have their correct name and birthday. You can choose not to have violent or rash people in the house. However, it would be unethical and unlawful to discriminate against tenants due to some activity in the past that has already been dealt with. So do check out legal guidelines for renting before you base your decision on past records.

In addition to the above steps, instinctual guidance is a powerful thing to make decisions. If you don’t feel things to be right, chances might be that they are actually not right. Therefore, use facts as well as your own gut to select the right tenants for your property!

via:http://www.propertycluster.com/blog/how-to-choose-tenants-that-will-help-to-boost-your-rental-business/