Every landlord needs a tenant screening process—but should you do it yourself or leave it to the professionals at a company that delivers the best property management Atlanta, GA offers? Outsourcing tenant screening, in theory, should be a no-brainer. After all, it gives property owners back some free time while improving the quality of their renters. However, there are many factors owners need to consider before they decide if outsourcing is right for them.
In this blog post, we'll explore some questions you should ask yourself before you outsource your tenant screening process.
What Should My Screening Process Include?
Some inexperienced landlords might decide to skip the tenant screening process and go with their gut when choosing a new resident—but this can be a costly mistake. It requires a little upfront effort, but tenant screening is one of the most important things real estate investors should do.
An Atlanta property management company suggests that a tenant screening process can help in two ways:
- It creates a system for how you qualify tenant applicants
- It helps defend a tenant selection in case of a discrimination claim
With a thorough and legal process in place, property owners can avoid discrimination claims. A legal screening plan includes processes you should incorporate, as well as things you should avoid, like questions that violate the law.
What should your screening plan include? A property management company recommends these elements.
While a prospective tenant might prefer that you rely on their word that they can afford the monthly rent, landlords should conduct income verification. By providing a precise requirement and verifying an applicant's income and employment, you can avoid placing renters who can't make their rental payments after moving in.
Many landlords, in addition to income verification, utilize employment history as part of their criteria. A rental applicant should have a verifiable history of employment that demonstrates job stability, no gaps in employment, and a consistent income. While job hoppers aren't always a sign of bad renters, they can have issues when it comes to paying rent because of instability with employment.
A rental property owner should obtain a credit report as part of the tenant screening process to provide a thorough examination of the applicant's financial status. Make sure to apply the credit report findings equally among all applicants to comply with the Fair Housing act. A landlord can, however, require a higher score depending on the monthly rent.
One of the best predictors of a renter's true nature is their references from previous landlords. A poor review from a prior landlord should be a red flag. Sometimes, even a personal reference could also provide a red flag to deny a renter from your property.
Be sure to look into an applicant's history of evictions or defaults. There are several valid reasons for an eviction, but a history of repeated removals or rent nonpayment should steer you toward a more qualified tenant.
Another essential element of screening services should be a proper background check. While property owners can't set a blanket policy to exclude all prospective tenants with a criminal history, they can evaluate the type of crimes and weigh the risks of allowing the renter to move in based on the potential for criminal activity to take place in the property or the danger to other residents and neighbors.
What Are the Benefits of Tenant Screening from Property Managers?
So, should you take on the tenant screening services yourself or leave it to a professional property management company? Unless you have the right experience, outsourcing the process to a residential property management company is the best way to protect your investments.
Here are a few benefits of handing off the screening process to a property manager:
- Avoid mistakes. Skipping the screening process or relying on a quick internet-only background check can leave you with a bad resident in your property.
- Save money. Many property management companies receive a bulk discount on credit and background check services and pass those savings on to the landlord.
- Avoid making rash decisions. A third-party property management company takes the emotion out of the decision-making process for new tenants.
- Difficult work done for you. Outsourcing the screening process means a personal relationship won't interfere with your decision to accept or deny a resident. Sometimes accidental friendships cause issues when it comes to collecting rent or enforcing the lease agreement.
- Catch warning signs early. You won't deal with months when your renter doesn't pay rent before realizing you have a bad tenant.
- Sidestep legal problems. Landlord and tenant laws keep landlords from discriminating against people based on race, skin color, sex, nationality, or religion.
Outsourcing means property owners benefit from professional property managers who have years of experience sorting through information and finding qualified tenants through the process.
Choose the Best Atlanta Property Management to Outsource Tenant Screening
The tenant screening is tedious and, at times, costly to go it alone. With the assistance of a valued property management partner, you find the best quality tenants for your rental properties. Let Compass Property Management put our years of experience to work in finding your next tenant! Reach out, and let's talk soon.
For expert insights to improve your process, download our free Tenant Screening Checklist!