Knowing How to Properly Screen Tenants Protects Your Garland Rental Properties

Some property management companies in Garland think it goes without saying that the screening process you have in place for your tenant prospects is one of the most crucial components of tenant placement. At RentHub Property Management, we disagree: an active emphasis on the importance of screening protects property investors.

As a seasoned property manager in Garland real estate, we've seen—or heard—just about everything that can happen to a property without a thorough screening process.

• Are you ready to handle the physical, emotional, and financial nightmare of accidentally opening up your property to a "Professional Tenant?"
• What about a tenant who is consistently late paying the rent—or can't afford to pay the rent you're asking for your Garland rental properties? Can your finances weather multiple defaults?
• Are your properties—and you—prepared to handle the stress of having the police called to your property when a repeat offender commits another violent crime? What about certain classes of offender who aren't allowed near schools?

A thorough, ethical screening process protects you and your assets from these situations—and more. Take it from us: how well you screen is your first line of defense when it comes to tenant placement in your rentals. As an investor with multiple properties, you can't afford to risk your long-term wealth with a lackluster screening process.

Now that we've pointed out the importance of screening, it's only fair that we dive into the process—and show how it should be done. Keep reading to learn how to properly screen tenants from an expert property manager!

A note before we proceed: This article is intended to outline the basics of screening with an emphasis on its importance—it is not intended as legal advice. We recommend a good attorney for that!

Use a Third-Party Provider

At RentHub Property Management, we are a big supporter of the "DIY" investor mentality: it's why we offer so many of our expert resources to landlords and investors for free! This includes our powerful Tenant Screening Checklist to guide you through the perilous waters of choosing to screen tenants yourself.

However, we're also big fans of honesty: when you work with a third-party screening services provider like a property manager in Garland, you protect yourself and your properties from the danger of unintentional bias or your "gut feelings" about potential tenants. Some measure of trust in your instincts is important—but they can't be the deciding factor.

As the captain at the helm of your real estate portfolio, it's essential to know when to delegate a task: your job isn't to furl the sails, it's to direct the entire ship! With that in mind, if you do choose to go with a third-party screening provider, it's crucial to select one that is compliant with the Fair Credit Reporting Act (FCRA) that will keep your properties in line with the Fair Housing Act (FHA).

How Does the Fair Housing Act Affect Your Properties?

Also referred to officially as "Title VIII of the Civil Rights Act of 1968," the FHA modulates real estate transactions—and protects the parties entering into them—including the process of renting your Garland rental properties. As an investor, you can't deny access to your rental properties to certain protected classes.

So, which tenant characteristics fall under this protection?

• Race
• Color
• National Origin
• Religion
• Sex
• Familial Status
• Disability.

What this means for you as an investor is that you can't refuse to rent to males just because you prefer female tenants, or discriminate against Brazilians because they've won the FIFA World Cup more than any other team. However, that's not to say that all criteria are off the table; this is where compliance with the FCRA becomes critical. Even if you're not the one pulling the tenant's information directly, you are responsible for protecting the privacy of each potential tenant.

What Eligibility Terms Can Investors Check?

The primary avenues for investigative research into a potential tenant's suitability for your Garland rental properties concerns their:

• Credit history
• Criminal history (with exceptions)
• Employment history
• Eviction history.

You can learn a lot about a tenant's ability to keep up with rent payments via their credit and employment histories: maybe a tenant has had a shaky history of employment. Coupled with a low credit score, this might indicate that keeping up with the payments for your rentals could be a challenge.

Eviction history is also telling: a repeated string of evictions and a history of legal altercations with former landlords should be a significant red flag. This kind of behavior can often signal a Professional Tenant—and they are experts at glossing it over. If you're sitting across from your prospective tenant and they start letting slip about their extensive knowledge of the legalities concerning renting, steer your investments away from them—and fast!

Criminal history is a little trickier: investors should handle this information with care. 

• Is there an arrest on record—but no conviction? An arrest is just a suspicion of wrongdoing—not confirmation thereof. You can't deny a tenant based on an arrest.
• If there is a conviction, is it related to the safety of your property and neighbors?  There's a big difference between a violent felony and a traffic misdemeanor.
• Does the conviction hamper the ability of your tenant to find work—and, therefore, limit their ability to pay the rent?

Be careful to avoid "blanket discrimination" against a potential tenant's criminal history.

Property Management Makes Screening Simple!

It's easy when you have multiple investment properties to cut corners accidentally—and it can happen without you even realizing it. When it comes to screening your tenants, you absolutely cannot afford to slip here when it comes to the details. 

When you work with a property manager in Garland to help you screen your tenants, you bring in more than a capable pair of hands! You gain access to all the local, state, and federal knowledge that property managers have pertaining to ethical and safe screening practices. When you do hand over the keys to your rental castle, you can trust you have an excellent tenant to care for it.

Even if you choose to tackle screening on your own, take advantage of resources put together by the experts! When you download RentHub Property Management's FREE Tenant Screening Checklist, you'll protect yourself from the start by setting defined screening parameters that the pros use when finding the perfect tenant!

Download The Checklist