When leasing a property, landlords and property managers understand the significance of selecting reliable tenants who honor their rental commitments and maintain a harmonious living environment.
Rental verifications have become an integral part of the application process. They ensure the utmost confidence in a prospective tenant's credibility. Property owners can gain valuable insights into an applicant's tenancy history, financial stability, and overall suitability by conducting a thorough verification process.
This article delves into the crucial aspects of rental verification, shedding light on the significance of this process in mitigating risks and achieving a smooth rental experience for both landlords and tenants.
What Is a Rental Verification Process?
Rental verification is a crucial step in the tenant screening process, which not all landlords practice. It goes beyond background and credit checks. The landlord contacts the prospective tenant's previous landlord to verify their rental history and assess their reliability.
Essentially, rental verification acts as a safeguard to ensure the authenticity of the information provided by the applicant regarding their rental history. While background and credit checks provide valuable insights, speaking directly with a previous landlord offers a more comprehensive picture of the applicant's suitability as a tenant.
The duration of the rental verification process may vary, but typically it takes around 48-72 hours for a rental property to complete the verification process. If multiple applications are received for the same property, the application process may take longer to evaluate and compare the applicants thoroughly.
Why Should Tenant's Rental History Verification Matter
Rental verification holds significant importance in the tenant screening process for several reasons:
Helps in Landing the Right Tenant
Rental verification allows landlords to confirm the accuracy of the information provided by the applicant regarding their rental history.
By contacting previous landlords, property owners can verify the duration of previous tenancies, rent payment history, lease violations, and overall tenant behavior. This information helps landlords make informed decisions about potential tenants and reduces the risk of issues during the tenancy.
Evaluates Reliable Tenants
Speaking directly with the applicant's previous landlord provides insights into their reliability as a tenant.
Landlords can learn about the applicant's ability to fulfill their rental obligations, including timely payment of rent, adherence to lease terms, and maintenance of the rental property. This evaluation helps identify potential tenants likely to uphold their responsibilities, avoid damaging property, and maintain a positive relationship with the landlord.
Predicts Future Performance
Past behavior is often indicative of future behavior. Rental verification allows landlords to assess an applicant's track record as a renter, indicating how they will perform as a tenant in the future, (i.e., pay monthly rent on time). Landlords can gauge the applicant's level of responsibility, consideration for neighbors, and overall suitability for their rental property.
Mitigates Risks of Property Damage
Engaging in rental verification helps landlords minimize potential risks associated with problematic tenants.
By verifying an applicant's rental history, creditworthiness, and employment stability, landlords can identify any red flags, such as a history of evictions, financial troubles, or inconsistencies in the information provided. This due diligence reduces the chances of facing payment issues, property damage, or legal disputes during the tenancy.
Maintains Rental Property Value
Verifying the rental history and credibility of prospective tenants helps maintain the value and condition of the rental property.
Tenants with a positive rental history and a track record of responsible tenancy are more likely to prevent property damage, comply with maintenance requirements, and foster a positive living environment. This, in turn, helps preserve the property's condition and value in the long term.
What Is a Rental History Report?
A rental history report provides a comprehensive record of the addresses where a tenant has previously rented, including contact details of the landlords or property managers during those periods.
While the applicant's credit report may contain some of this information, requesting a complete list of addresses and contact information for previous landlords directly from the applicant is advisable. This ensures thoroughness and allows direct communication with prior landlords to gather valuable insights about the applicant's rental history.
What Is the Purpose of a Landlord Verification Form?
A landlord verification form is essential for landlords in the tenant selection process, as it enables them to choose reliable tenants. Others refer to it as a rental verification form.
For prospective tenants, receiving a verification letter from a landlord signifies a significant milestone toward finalizing a tenancy agreement and securing a new residence.
Landlords must request accurate tenant details from the outset, because this process involves exchanging personal information.
Here's what to ask for in a rental verification form:
- Full legal name(s) of the prospective tenant(s) and their contact details
- Co-signers or additional occupants, if applicable
- Current address and contact details of the current landlord or agency
- Past addresses and contact details of previous landlords or agencies
- Personal employment details and income information
- Name and contact details of a guarantor, if applicable
- Any outstanding debts or additional relevant issues
- Tenant(s) signature(s) and date of signing
A rental verification form is valuable for landlords to gather comprehensive tenant information and conduct necessary checks to make informed decisions about prospective tenants. It ensures consistency and fairness in the tenant screening process while maintaining compliance with legal requirements and regulations.
Prospective Tenant's Rental History Verification Process
Conducting rental verification involves several steps to gather information, verify details, and assess the suitability of a prospective tenant. Here are the steps involved:
Obtain Consent for Rental History Verification
First, the prospective tenant should provide written consent to allow the landlord or property management company to verify their rental history. This consent is usually provided through a rental application or a separate authorization form.
Receive Rental Application
Begin by obtaining the rental application from the prospective tenant. This document provides initial information about the applicant, including personal details, employment, and references.
Check the Applicant's Rental History
Reach out to the applicant's current and previous landlords to verify the applicant's rental history. Use the provided contact information to communicate with them directly. Inquire about the duration of the tenancy, rental payments, any eviction history, and overall tenant behavior.
Verify the accuracy of the information provided by cross-referencing it with the responses from current and previous landlords. Ensure that the rental periods, rental amounts, and payment records align.
Check Eviction Records
Conduct an eviction records search or request an eviction history report to identify any past evictions or legal disputes related to rental properties. This step helps assess the applicant's history and potential risks.
Perform Background Checks
Conduct comprehensive background checks, including criminal history, to ensure the rental property's and existing tenants' safety and security.
Review Bank Statements
Request bank statements or financial records from the applicant to verify their financial stability and ability to pay rent consistently.
Check Credit History
Obtain the applicant's permission to run a credit check and examine their credit history, outstanding debts, and payment patterns. This assessment helps evaluate their creditworthiness and financial responsibility.
Inquire about Noise Complaints
Contact previous landlords or neighbors to inquire about any noise complaints or disruptive behavior that may impact the peacefulness of the property.
Contact Personal References
Reach out to the personal references provided by the applicant to gain insights into their character, reliability, and suitability as a tenant.
Assess Rental Payments
Evaluate the applicant's rental payment history and ability to pay rent on time consistently. This step ensures they can meet their financial obligations.
Review Monthly Rent Affordability
Consider the applicant's income and financial status to verify their ability to afford the monthly rent and associated costs.
Use an Online Tenant Screening Service
Alternatively, landlords can use an online tenant screening service to verify prospective tenants. An online tenant screening service is a digital platform or software that helps landlords and property managers streamline and enhance their tenant screening process.
Online tenant screening services automate the screening process, saving landlords significant time and effort. Landlords can rely on the service to gather and present the necessary information instead of manually contacting references, conducting background checks, and compiling reports.
These automated services provide objective information about applicants, removing biases or personal judgments that landlords may inadvertently introduce into the screening process. This promotes fair and consistent tenant selection based on verifiable data.
What If This Is the Applicant's First Rental?
If a tenant has no rental history, it can present a challenge for landlords or property managers during the screening process. However, there are other ways to evaluate applicants who lack a rental history:
Employment and Income Verification
Verify their employment status, income level, and job history to gauge their ability to meet their financial obligations, including rent payments.
Request a credit report to review the applicant's credit history, even if they don't have a rental history. The credit report can provide insights into their financial responsibility, debt management, and payment patterns.
Personal references like supervisors, colleagues, or mentors can provide valuable insights into the applicant's suitability as a tenant.
Co-Signer or Guarantor
A co-signer is an individual who agrees to be financially responsible for the lease if the tenant fails to fulfill their obligations. A guarantor provides a similar level of financial security.
Request additional documentation like bank statements to verify the applicant's financial stability and ability to pay rent consistently. Reviewing their savings, regular deposits, or other financial indicators can provide insights into their financial responsibility.
Interview and Screening
While this method may not provide concrete proof, it can help gauge their suitability based on personal interaction.
Does rental history show up on the tenant's credit reports?
Traditional credit reports do not typically include rental history information. They mainly concentrate on an individual's credit accounts, payment history, debts, and credit-related activities. However, specialized tenant screening reports specifically gather and present rental history details for landlords and property managers.
How do you collect rent after a lease is signed?
Here are the steps for collecting rent after the lease is signed:
- Ensure that the lease agreement clearly outlines the rent amount and other details
- Send regular payment reminders to tenants
- Offer multiple payment options to accommodate tenant preferences
- If managing multiple rental properties, consider a professional property manager or property management software
How do I get around rental verification?
If your previous rental history has not been exemplary, having a co-signer can help instill confidence in the landlord regarding your future tenancy. A co-signer is an additional adult, such as a parent or trusted friend, who agrees to assume responsibility for paying the rent and addressing any apartment damages if you cannot do so.