How Landlords Can Avoid Nightmare Tenants
Are you a landlord who has had the pleasure of chasing a tenant every month for rent? -- Or maybe you are consistently asked to “repair” the clogged toilet or “fix” the burnt out light bulb?
Income properties (especially multi-unit properties) make great investments and usually increase in value by 20% every 10 years. -- However, real estate investors need quality renters. -- Here are some good tenant prescreening tips:
Stay Away from “Time Thieves” – These renters will tell you their life story so that you warm up to them before they continue rambling about how their credit was destroyed. – Ask if they have good credit at the beginning of your discussion. If they hesitate, say that their identity was stolen, or that the crazy ex-spouse destroyed it, you may want to end that call and move on.
Pull Credit Yourself – Never accept credit reports provided by applicants since they may be ‘doctored’. – I occasionally see landlords who just go with their gut and don’t pull credit. – ALWAYS pull credit and don’t accept scores lower than 600.
If they had a hardship (such as temporary unemployment, a short sale, etc.), you can still consider them, however, if they have numerous unpaid utility bills or missed car payments on that newer Mercedes they just can’t afford, you should run for the hills.
Allow “Kitty” or a Small Dog – and require a pet deposit (usually $250). -- 80% of renters have either a cat or dog. For single family homes, a “no pet policy” may turn away excellent renters. – You don’t need to allow dogs over 20 pounds. Just try not to close the door on quality renters who have just one cat or one small dog.
Verify Employment – by calling their employer and ask the applicant for their last 2 paystubs. – If they get paid with cash only, you may want to find a different renter who is “W2ed”.
Call Most Recent Landlord – and ask if the applicant was responsible, paid rent on time, and didn’t throw huge parties (without inviting the landlord too). -- On public tax records, verify that the landlord really owns the property (a local title company can verify this as well).
In Some Areas - Landlords may have no choice but to rent to folks who have damaged credit and/or get paid with cash only. – If so, just make sure that they have stable employment, paid their last landlord on time, and don’t have a criminal background (this can be checked when their credit is run).
On The Lease - Always outline that repairs under $75 are the tenant’s responsibility (clogged drains, light bulbs, etc.). -- Include the number of adults and children with each adult’s full name listed. -- Also state that you need to know 60 Days prior to the lease expiration if they are going to renew (so you have time to rent it out again if needed).
Well-Maintained Income Buildings - attract quality renters. Always make sure it is professionally cleaned at the end of each lease and try to paint with neutral colors as needed.
Good luck! -- These prescreening techniques will help you find quality renters so you can sleep better at night. J
Thanks for reading,
Chicago Realtor John Meyers (Managing Broker of Meyers Realty & Chicagoland Rentals) www.MeyersRealty-Chicago.com, 847-533-7115, Chicagoland007@yahoo.com
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