We’re often asked what information we collect to arrive at a decision whether or not to rent to a prospective tenant. In managing single family homes in Las Vegas, Henderson and Summerlin, it is very important to our clients that our tenant selection process be sufficiently cautious, but not overly so. Lack of caution in tenant screening results in high turnover, lost rent, and property damage. Overly-cautious tenant screening methods result in long-term vacancies, lost rents, and, yes, property damage. Vacant homes deteriorate quickly.
Our many years of property management experience has paid off, particularly in the area of resident screening. We have learned not only is it important to review the credit report of a prospect, but it’s important to look at a number of other factors as well. That is why we use a 21 point scoring card to process and approval all rental applications. For more information view our Applicant Center.
Does the applicant have the means to pay the rent?
How long has the prospect been employed in his/her current line of work? Is this a new career for her, or has she demonstrated a long-term commitment to her field of employment? This makes a difference. It indicates stability, or lack thereof. Income counts, too. Is the paycheck going to cover not only the rent, but the prospect’s other expenses? If not, something’s going to be sacrificed. As a landlord, we don’t want that sacrifice to be the timely payment of rent.
What does the former landlord have to say?
Better yet, what do the last two or three landlords have to say about your prospect? It’s not unusual for the current landlord to soften his evaluation of the prospective tenant. After all, he’s still the current landlord. The former landlord, however, generally feels far removed enough from your prospect that he’s apt to be frank and forthcoming with information. Do you take what a landlord says at face value? Of course not! Whether that information is positive or negative, it is subjective in nature. The landlords’ feedback is helpful, but should never be a stand-alone reason to accept or deny a prospect.
What about bounced checks and criminal history?
Are those items important? We think they are. Combined with the other factors we evaluate, these items help to provide a complete picture of the likelihood of the prospect living up to his/her end of the rental agreement terms.
Tenant Screening...the whole picture:
The greatest lesson we bring to the table, in terms of tenant screening, is the knowledge that no single factor in a tenant’s financial picture, residential history, or references stands alone. All facts, taken together, paint the picture of the prospective resident. Taken together, these facts and bits of information are going to lead us to a more accurate conclusion as to the likelihood our prospect will do the two things we require… pay the rent and take good care of the property.
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Do You Dare Share? Credit Reports & Rental Documents.
Q1. As part of our tenant application review process, we do credit checks on contenders. The tenant is demanding a copy of the credit report saying it’s his/her information and he/she owns it. Do they?
A1. First, inform the tenant that they can obtain this information directly from the credit agency that provided the report to the property manager/landlord. According to Experian, it’s better the tenant gets the information directly from the credit agency because not only is it often free, but the report sent to the landlord/property manager is an abbreviated version. Additionally, check out these other helpful articles for guidance:
(1)Article from Experian recommending landlords give tenants information on getting personal reports directly from credit bureaus: Landlords Can Share Credit Reports with Tenants – Experian
(2)Article from the FTC regarding what landlords need to know about using consumer reports: Using Consumer Reports: What Landlords Need to Know
Q2. Can an Owner require a Property Manager to provide copies of the rental application to him/her. Or is this information confidential?
A2. NRS 645.252 and 645.254 creates confidentiality between the agent and the client – that would be the landlord. That duty of confidentiality needs to be counterbalanced with NRS 645.252(2) which requires care and skill to ALL parties, which would include the tenant. The rental application inherently contains personal information subject to NRS 603A: NRS: CHAPTER 603A – SECURITY AND PRIVACY OF PERSONAL INFORMATION (state.nv.us). Ask the client/landlord, what’s the purpose of the request? Is it to file a lawsuit? OK – what information is necessary to do so (parties legal name, address, etc.) and consider providing just the necessary information.
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