My first time checking tenants` background

[holymoly]

Hi everyone,

I did my first rental open house recently, for my first property. I would now like to check applicants` credit history and so on. I`m totally green and I welcome all advice.

I`ve been looking at the Rent Check site, but I have some reservations. Would you recommend them, or another bureau? Would you normally get the Credit Check and a Tenancy Report?

Thanks!

 

[randy]

QUOTE (holymoly @ Oct 14 2008, 03:17 PM) Hi everyone,

I did my first rental open house recently, for my first property. I would now like to check applicants` credit history and so on. I`m totally green and I welcome all advice.

I`ve been looking at the Rent Check site, but I have some reservations. Would you recommend them, or another bureau? Would you normally get the Credit Check and a Tenancy Report?

Thanks!

I use rentcheckcorp.com I just rented my house and it was very helpfull. I spoke with 2 separate tennants that both seemed great assured me ther credit was great. Nothing to worry about. Well one had $10,000 in judgments and the other had a bankruptcy. I may have been able to deal with these problems but if a tennant can not even be honest in the begining you will have problems. I also found out that they gave me the wrong SIN number. The tennant reporting history has never shown anything for me. As I was checking the first Tennants credit I even thought to myself what a waste of money and just about did not do it. It was the best $ 15 I ever spent.
Now I rented to a great family with good credit if I had not checked the first two applicants I would be stuck with a bad tennant.
Good luck

 

[invst4profit]

Never ever rent to anyone without doing a credit AND personal background check. To me the personal background check is invaluable as it tells you a lot about the kind of individual you are dealing with in addition to how they handle money. Call there personal references, present landlord, previous landlord, employer etc. Drive by there present residence and see what kind of life style and standards they have. Decide what you will accept as a minimum credit score.
DO NOT feel sorry for any sob story they give you to justify there past behaviour. Do not ever consider accepting anyone that lies, misleads or fills out there application form with missing information or incorrect information. Never accept any applicant with a previous eviction regardless of the reason (usually they blame the landlord).
I personally would not accept recently separated persons, couples that have not lived together before, individuals that have recently changed jobs or self employed that can not show a consistent income stream. And no pets.
Charge the applicant the fee to do the credit/criminal checks and tell them if accepted it will apply to there first month rent (if you wish). If they don`t want to pay reject them. Tell them up front if you do the search and they end up being rejected they do not get there money back. Do a search on every individual planing to occupy the unit.
Also get a photo copy of there drivers licence to confirm they are who they say they are.

I use this company. $45 to join for life and $21 each search. Usually have results in a couple of hours on line. Cost to search doesn`t matter much if you have applicant pay.

http://www.checkfirstonline.com/

 

[holymoly]

Thanks for the information and advice!

I like the idea of the lifetime membership, and CheckFirstOnline`s website seems user-friendly. (I found RentCheck`s to be a bit confusing, and their voicemail box is full so I couldn`t make inquiries.)

I`m a bit freaked out over the requirement to have Equifax do an inspection! What do you do if you`re someone who owns just one rental property and doesn`t have an office space away from home? I don`t even have a lockable room in my house, other than the bathroom. And how long does it usually take for them to come do the inspection? Thanks again.

"You are required to keep any computer, laptop, handheld or other equipment or hardware used to receive Equifax information under controlled access; store your files in a locked filing cabinet or safe; Password protect your computer or other hardware; show that you have adopted proper measures of disposing files by burning or shredding; delete, erase and destroy files when no longer needed. Your office space where you store information must be lockable, separate from and not utilized as "living quarters"

 

[invst4profit]

Don`t worry about it. Set up a space for records somewhere in your home and carry on with normal record keeping. No inspection is carried out.

 

[MichelSelim]

I use rentcheckcorp.com, and it saved me lots of grief. It can add up if you are interviewing few applicants, but it is worth it.

I agree it is not user friendly. I use it only because their president gave a presentation in Calgary and he explained it to us. He said three years ago that they are in the process of redesigning it, hemmm.... May be I should try the other website suggested in this thread.

For reference check, I always indicate to my applicants that family and friends references are not acceptable. My first question to the reference is: Beyond tenant/landlord relation, are you related to the applicant in any other way? (friends, family, coworker,...)

I learned that after someone gave me his mom as a reference

 

[holymoly]

QUOTE (invst4profit @ Oct 15 2008, 11:31 AM) Don`t worry about it. Set up a space for records somewhere in your home and carry on with normal record keeping. No inspection is carried out.
Phew! That`s a relief to know. Thanks!

 

[holymoly]

QUOTE (MichelSelim @ Oct 15 2008, 12:36 PM) For reference check, I always indicate to my applicants that family and friends references are not acceptable. My first question to the reference is: Beyond tenant/landlord relation, are you related to the applicant in any other way? (friends, family, coworker,...)

I learned that after someone gave me his mum as a reference
More good advice -- thanks. I have applicants who list Mom as landlord...

 

[MichelSelim]

I am Ok if they are upfront and honest about it. You would be interested to know that I check the Reverse Directory on the reference phone number to see who owns this number.

Just by doing that, I found that the last name of the applicant matches the last name of the phone owner (his dad), so the nice lady I already spoke to was his Mom!!!!!

Can you guess what a good reference I got from her? :- )

 

[invst4profit]

Mothers do give good references especially if they are finally getting there kid to move out of the house. Present landlords that are glad to get rid of a bad tenant also often give good references. This is the reason for having a contact number for their previous landlord.
When calling a landlord always start the conversation inquiring about a apartment they have for rent.

 

[holymoly]

QUOTE (MichelSelim @ Oct 15 2008, 12:59 PM) I am Ok if they are upfront and honest about it. You would be interested to know that I check the Reverse Directory on the reference phone number to see who owns this number.
I tried that, too -- this Mom`s number is a cellphone without listed ownership info.

A note about CheckFirstOnline -- their phone number is out of service.

The site took my Visa payment and I got an automated email but it didn`t include the promised "confirmation link." Sigh...

 

[invst4profit]

In the past contact with them for me has been very pleasant and they are very accommodating. I have had some problems with there system accepting my credit card (visa changed my card) and they have worked quickly through the problems over the phone and through e-mail. Just be patient and things should work out.

By the way welcome to the business and good luck.
Actually with thorough screening and a strict tenant training program luck is not a factor.

 

[holymoly]

QUOTE (invst4profit @ Oct 15 2008, 02:14 PM) By the way welcome to the business and good luck.
Actually with thorough screening and a strict tenant training program luck is not a factor.
Thank you very much!

 

[JoanneCecchi]

QUOTE (holymoly @ Oct 15 2008, 02:24 PM) Thank you very much!


I have enjoyed this string of emails because I am fairly new to the process as well. Greg, I was wondering what you train your tenants on?

Joanne Cecchi

 

[holymoly]

Thank you again for your generous insights. I wanted to follow up to let you know what happened regarding the inspection. I did set up a locked space and locked filing cabinet (a good idea for me to have this, anyway!) and an inspector came. The inspection involved taking photos of the secure set-up, the desk/computer, and the front of the business establishment. There were also some questions along the lines of `number of employees, type of business, why do you want to order credit reports.` When all was said and done, I was cleared to order credit reports from Equifax.

 

[invst4profit]

Interesting. No one ever inspected me.

As far as what to train tenants on it is based on what you as a landlord require from them personally. Depending on the type of unit it may involve noise restrictions, proper disposal/storage of trash, there responsibilities regarding grass and snow etc. Spell out your expectations and for the first few months make regular inspections of the property with proper notice. If you do not like what you see send them a notice stating what you want changed.
I find a letter has a greater impact than verbal and every communication goes into there file.

The most important item to train them on is rent payment. It is to be on time and in full by midnight on the first of the month. Never accept partial payments for any reason. If it is not on time or in full I immediately send out a late/eviction notice. Personally I do not call them or chase them in any way and simply wait for them to call me in a panic about the eviction notice.
They will have some lame excuse which may or may not be legitimate.
I stop them in mid sentence and very politely say it is not necessary for them to give me a reason, explanation or apology. Reasons do not pay my bills. I tell them I expect the money in full immediately and further state that if it happens two more times, regardless of the reason, I will evict them.

I always explain to them that a roof over there head is more important than paying any other bills they may have and if it is not there #1 priority each month they should consider living some where else.

The most difficult tenants to deal with are the ones that openly state that they have rights as tenants and come across as being untouchable. I clearly state to them that I am a very experienced landlord (even when I wasn`t) and as such have ways to legitimately evict any tenant that crosses the line should they wish to test me.
I make it clear, with words and actions, that I am a very fair, reasonable and friendly landlord to all deserving tenants.

Credit reports, background searches and pre screening are your most important tools.

 

[JoefromTO]

QUOTE (holymoly @ Oct 22 2008, 07:11 PM) Thank you again for your generous insights. I wanted to follow up to let you know what happened regarding the inspection. I did set up a locked space and locked filing cabinet (a good idea for me to have this, anyway!) and an inspector came. The inspection involved taking photos of the secure set-up, the desk/computer, and the front of the business establishment. There were also some questions along the lines of `number of employees, type of business, why do you want to order credit reports.` When all was said and done, I was cleared to order credit reports from Equifax.


Holy Moly!!! Pun intended

I can`t believe and inspector came by your house to inspect that! Wow...

You know...after reading lots of the threads on this site, I can honestly say that whenever I have incured a headache, it was always my fault for being to relaxed with my screening process. In fact, the one thing that really makes it difficult is the element of time. When a tenant gives notice, they don`t always give 2 months notice...which is obviously something I try to enforce each time. But if your trying to find a good replacement and time is running out, you feel rushed! That`s usually when I make my mistakes.

I have read the 2 main books written by Don and am planning on becoming a REIN member as well because I am starting to realize that if you work the fundamentals properly, you`ll be buying properties that have a growing population, along with many other positive reasons. But what that translates too is more people will be calling about your place so you`ll have more to chose from. This obviously makes it easier to find a good replacement.

However, keep this one fact in mind...If worse comes to worse, don`t feel rushed to fill the spot, even if your time is up and its now vacant. The financial and emotional cost associated with renting to the wrong person/people is much worse that losing a months rent. Hopefully that never happends though...just something to think about...chose which evil you prefer.

 

[MikeMcCrae]

I don`t do credit checks on my customers. People are often tenants because they have bad credit. So I am most likely to get the information I already suspect. I had one tenant with me for 3 years and I finally convinced him to buy a house and build his own equity. When I pulled his bureau he had a score under 500. Very poor! But as a tenant he is great I still have him as a tenant a year later. Paying a credit card on time and paying rent on time are very different things, and as Greg stated the training is very important. Late rent is not tolerated and always met with a notice on the second, even if arrangements are made to pay on the 3rd. Fast action early in the relationship ensures that if something is not getting paid this month rent is not what is missed. Also I am not an equal opportunity landlord, some groups just don`t get in. Some groups of people have habits I don`t approve of, and I want my customers to have similar values to mine, we are partners in this venture to a degree and we need to be able to look at things from a similar perspective, some ages and genders have proven more problematic over time so I avoid them. My bias is not on religious or nationality grounds just general lifestyle things I have picked up on. Unfortunatly this is not fair to every one in those groups but it is my money on the line and I just don`t need to keep testing and proving my theories, I just don`t need the hassles.
Having a good conversation when showing the unit tells you so much. Ask them lots of questions about themselves and their work and family. If they hate their current landlord ask why. They often love to tell you things like, he wasn`t understanding when my husband was out of work and we were only a week late with our rent, or he was mad at us when the neighbors called the police. People are so funny but you can learn alot in just a few minutes.
We have been very fortunate with our customers. Since 1999 and over 30 tenants we have only had 3 problem ones. We only rent to people we like and if we quit likeing them (or them us) we set out a plan to rid ourselves of them. Life is too short to work with people you don`t like.

 

[invst4profit]

I agree with Mike`s point on having a good conversation with perspective applicants. I can usually tell within the first 5 minutes if a person is a good fit for me.

However the credit report tells me a lot about a individuals personality that may be hiding. Regardless of how much one earns it is how they handle that income that is there true measure.
I have found that in lower income groups the credit rating rather than there income level tells me the most about the type of tenant they will be.
Given the same income level I can tell which will most likely be the most conscientious tenant based solely on there credit score. Conscientious tenants try harder and in my opinion take a higher level of pride in there home.
This of course excludes those individuals with temporary blips in credit caused by life issues like divorce.

My client base is a mix of lower income and pensioners and since my tenants are being screened to buy the home there level of pride in ownership is very important to me as there landlord.

 

[dcres]

I phoned RentCheck inquiring about their rates recently. They want $50 membership + $19.95 one time fee.
That`s $70 before you get even started to get a report on your Tenants.
I also talked with Landlord 911, they charge $25.00 + GST for a Tenant check. No membership or other costs.