The key to a successful tenancy often lies in the hands of your tenants. Letting your property to an unsuitable tenant can cause some real headaches that any landlord could do without. To avoid finding yourself in this situation, it’s advisable to screen your tenants thoroughly before committing your property to anyone.
In this article, we explain the pitfalls of not screening your tenants and the best practice process that any landlord should follow when carrying out this all-important element of tenant-finding.
As a landlord, the least you deserve back from letting your property is rent payments. Without rent payments, being a landlord can feel like a particularly fruitless endeavour. It’s likely that you took out a mortgage when you purchased your investment property. You rely on your rent payments to cover this and perhaps make you a profit too.
When you screen your tenants or use a screening company to do it for you, it involves running credit checks, ensuring a prospective tenant has the funds or the means of earning the funds to meet your rental commitment and may also involve checking their salary with their employer.
If a potential tenant has a bad credit history or earns a lower salary than you’re comfortable with given the rental price, you’re in your rights to reject their application. But remember – a bad credit history doesn’t necessarily mean that a tenant will struggle to pay rent. Always keep an open mind and an open conversation with the individual in question with any concerns you might have.
Unfortunately, not all tenants will look after your property in the same way that you would. In saying that, it’s rare and unlucky to come across tenants who would ever maliciously cause damage or be careless to the extreme. After all, your property becomes their home. Most tenants will respect your property and their space.
Screening tenants, however, can protect you from those that perhaps won’t be quite as respectful. You can ask any prospective tenants to provide a reference from previous landlords or letting agents. This will make you aware of any issues in the past surrounding property maintenance. If an individual has never rented before, this may not be possible and you may need to take a chance or act on a gut instinct as to whether you can trust them to take care of your property.
Remember to carry out regular property inspections to ensure that everything is in good working order within the property once your tenant has settled in. This way, you can deal with any damage issues before they become too much of a problem. However, it’s important to understand the difference between damage and fair wear and tear.
It is unreasonable to expect your property to be kept in pristine condition. Carpets may become worn and marks may appear on walls but you cannot take money from a deposit in this instance as much of it is simply the result of the property being lived in.
Keep a low turnover rate
Once you’ve found trustworthy and reliable tenants, you can sit back, relax and enjoy being a landlord. When you don’t screen your tenants and therefore don’t find the right people, things can become more work. You may find yourself pulled into dealing with rent arrears, disputes with neighbours and perhaps even disputes with yourself.
When things go wrong, tenancies can break down and in the worst cases, end in eviction. This can be very time-consuming and also expensive if you require legal support. You may find yourself regularly putting your property up for advertisement to find new tenants.
Screening gives you the confidence that you’re offering your investment to people that you can trust, potentially saving you money, time and many sleepless nights!
It’s up to you who you choose to rent your property to and some reasons are valid reasons not to rent your property to someone, such as salary, credit score and a criminal record. But remember, you cannot discriminate against tenants for their age, race, gender, sexuality, religion, disability or if they are pregnant, married or single.
Screening can go a long way in protecting your property but don’t forget to protect yourself with landlord insurance too. You can compare landlord insurance quotes online to make sure you find the right deal at the right price. Good luck and happy landlord-ing!