Managing a property is a big responsibility and it’s difficult enough without having neglectful tenants. As a property investor, your main source of income is the rent payment and you can’t afford to make a lease agreement with residents who don’t make payments on time or damage your property and cause issues.
There are many factors to consider when you are reviewing potential tenants. You need to go through applicant screening to ensure that your investment pays off. Here’s why tenant screening is so important.
Ensure they pay rent on time
A part of the tenant screening process is asking applicants to answer questions about their income. Property managers know that such information is crucial to be safe. If your tenant doesn’t have a stable job and consistent income, there is a big risk that they will postpone paying rent, which is fine in some cases, but this can become chronic.
Without getting details about your tenant’s job, you might have to put up with a resident who doesn’t pay rent for months. Having to evict a tenant and starting the tenant screening process over again can be exhausting. Therefore, you should screen tenants from the beginning.
Although nothing can guarantee that the tenant will pay the rent on time each month, you need to ask for their rental history so you know they are an honorable person and if they have enough funds to bring you income.
Protect your property
Property is one of your most valuable assets. Whether your relationship with a tenant ends with an eviction or if they leave on their terms, you will need to rent it out again, sell it, or live in it yourself.
Some tenants tend to be neglectful of your property and items, especially if you are renting out a fully-furnished property. Sometimes, tenants take the liberty to repaint and renovate your property, although it’s not always distasteful, it might decrease the value of your property and you will have to spend money on returning the design to its original condition.
What’s more dangerous is careless tenants who damage your property and its necessities. From damaged furniture to scratched and stained flooring, property damage is a big issue that landlords often have to face. The income that you receive from rent payments might have to go back to renovating your property and therefore you will lose a lot of profits.
Avoid Issues With Other Tenants
Some property owners own multi-unit rentals and have multiple tenants. You need to protect all of our tenants. This is why you ought to conduct successful tenant screening. So that you know that every one of your tenants is a just resident and will not cause conflicts to arise. To avoid such issues you can ask for the applicant's criminal records and try to study their character from interviews.
If issues arise between the tenants you might get blamed for the conflict and have to face legal action at some point. You have to make sure that all of your tenants are honest and civil people.
Even if you don’t have multiple tenants, if you own a rental condo, you will have neighbors. If your tenants are loud and destructive, have parties at night, and disrupt the peace in the building, it will all be your responsibility. You will have a damaged reputation in the neighborhood.
Gain Peace of Mind
When you complete a full tenant screening process and choose the right resident for your property, you will gain peace of mind. After getting to know your tenant you will be able to relax and stay calm knowing that your property is in good hands.
Even if you have hired a property manager to take care of finding the right tenants, you still need to be sure that your rental is safe and that you won’t have to spend half of your profits on renovations, evictions, etc.
Property management is a big responsibility, you need to ensure the safety of your tenants but first and foremost you have to ensure the safety and security of your business, and therefore, your property. You can’t let just anyone live on your property, as it is your most valuable asset and you rely on it to bring you income. So it’s crucial that you go through a thorough and well-conducted screening process and ensure that your tenants can be trusted. This way you can save money and time, avoid conflicts, and protect what you already have.