As a property owner, being able to identify red flags in a potential tenant's rental history is essential for ensuring a smooth experience. Landlords file roughly 3.6 million evictions each year. You don't want to lease to an irresponsible renter, do you?
Well, to avoid that, you must understand red flags, and know how to spot them early. Doing so can save you headaches down the road. With that said, let's discuss some key clues to look for in a low-quality applicant.
1. Inconsistent Income
When evaluating potential tenants, it's essential for landlords to thoroughly review the rental history of applicants. One of the primary red flags to watch out for is inconsistencies in income.
Stable earnings are necessary for meeting rental obligations. Any discrepancies or gaps in employment history could indicate financial instability.
2. Past Evictions
An eviction should always be a major concern. Past evictions suggest a pattern of non-payment or lease violations, which makes it a significant red flag. Conducting an extensive background check is imperative for uncovering eviction records and verifying the accuracy of the applicant's rental history.
3. Late Payments
Another red flag is a pattern of late payments. A consistent record of late payments is indicative of financial irresponsibility. This could potentially lead to non-payment of rent in the future.
Landlords should consider this as a warning sign that the applicant may not be a reliable tenant. Thoroughly examine past rental payments to identify recurring issues that may hinder the tenant's ability to meet their financial obligations.
4. Poor Landlord References
A significant red flag in a tenant's rental history is a lack of landlord references. This also applies to negative feedback from previous landlords. Landlord references provide valuable insights into an applicant's behavior, reliability, and adherence to lease terms.
If an applicant fails to provide references, be cautious. Also, if the references reveal problematic behavior, like property damage or disturbances, it should raise concerns for you. Landlords must diligently follow up on the provided references. Doing so provides an understanding of the applicant's rental history and interactions with previous landlords.
5. Frequent Residential Moves
Frequent changes in residences and short-term tenancies can also raise red flags. A pattern of moving from one property to another within short time frames may indicate instability or dissatisfaction with rental arrangements. This behavior could pose a risk for landlords seeking long-term tenants who'll maintain consistent occupancy.
Landlords need to assess the reasons behind these repeated relocations and carefully evaluate whether the applicant will establish a stable tenancy.
Conducting an In-Depth Rental History Check
Delving into an applicant's rental history will prevent huge problems during the lease term. As a landlord, you have a duty to preserve your real estate investment. But, of course, that's easier said than done. That's why we're here to help.
At PMI North Bay, we'll make property management more manageable for you. Our parent company has been in the industry for over 20 years, so we have the tools to ensure your success.
If you're interested in learning more, call 707-346-5356, or contact us online. We look forward to partnering with you!
