What data do you need to screen and select a renter?

You’ve bought your property, got it freshly painted, maybe even renovated and updated the place with new amenities, and now you are ready to welcome new residents. The hard part is done, right? Well, not so fast. The screening process for potential renters isn’t always quick and easy. 

As a landlord, maintaining your investment over the long run is critical. In an ideal world, you want to find a renter who has a good credit score, employment references, and rental history — someone who will enjoy living in your property and want to stay for a while. 

The traditional methods of screening renters have been around for a while. Many of them are tried and true. However, that doesn’t mean there aren’t a few ways to move your search into the 21st century. After all, if you’re already using data and technology in the form of property management tools and as a way to collect rent and security deposits, it shouldn’t be a giant leap to expand it to screening applicants too.

How to approach the screening process

A prospective renter could give the best first impression in the world, but that doesn’t always mean your property is in good hands. So, you want to collect as much data as you can about your potential residents ahead of time to help you make a better decision. 

Know the rules

Before you dive too deeply into the screening process, it’s essential to know the fair housing laws for potential residents in your area. Start with the Fair Housing Act, which makes discriminatory housing practices against people based on their race, national origin, gender identity, religion, family status, or disability illegal.

Also, check out the rules in your state. The U.S. Department of Housing and Uban Development (HUD) has a directory for local regulations. If you still have questions, speaking with a real estate attorney in your area can help.

Many landlords work with a property management company to manage screening and the rental application process. However, before you hire any property manager, make sure they understand the laws in your area and comply with them for both your and the prospective resident’s sake. 

Consider your requirements

Every landlord and property owner has different priorities. What may be a red flag for you is fine for someone else. Start by narrowing down your primary requirements and how you want to screen for them. 

For most landlords, the key factors to think about revolve around income, rental history, and the background check. Those are the basics. From there, you can expand your requirements based on your area and the type of property you have. For example, if you own a single-family rental property recently renovated and has luxury features, you may want to require a higher credit score or not allow pets. 

Also, think about your comfort with flexibility here. Are your numbers for income and credit score hard and firm, or will you judge more on a case-by-case basis? A prospective renter may have glowing references from past landlords, no late payments, and solid employment history. But what happens if they have a credit history that’s lower than the number you set as your floor?  

Gather the right information

If you create the listings for your properties, add in language that will act as a pre-screener and help set expectations for prospective renters. Letting renters know ahead of time what kind of information you plan to request from them can help streamline the process.

Some of the information you could highlight here include letting renters know you plan to collect the following rental data:

• Personal information: You’ll want to start with contact information, but you may also want to ask for personal references, people who can attest to the character and personality of the prospective renter.

• Employment history: A primary concern for any landlord is if the renter can pay every month on time. You can ask for proof of yearly income, including pay stubs, and an overview of their employment history.

• Financial information: Many landlords also look at a renter’s finances to better picture their situation. Running a credit report and getting a credit score are common. You may also want to ask if there have been any previous bankruptcies.

• Previous rental history: You can learn a lot about potential renters by looking at their past rental history. You may want to chat with their former landlords, ask about on-time rent payments, and learn if there have been any major complaints or eviction history.

• Background check: A background check can alert you if the renter has any criminal history or criminal records, which may be a red flag for you.

You can also let renters know that you’ll require an application or credit report fee when they submit their application.

Once you get your application forms, you’ll need consent from the renter to start gathering data and move to the next stage. If the prospective renter meets all of your qualifications and requirements, you can sign the rental agreement and hand over the keys.

What if a qualified renter can’t afford the move-in requirements? 

The security deposit can often be a sticking point with rental applicants. Unfortunately, that may end up disqualifying a potentially great resident. 

Rhino helps solve that problem by replacing traditional cash security deposits with more affordable insurance at no cost to you. Renters pay a monthly fee*, and Rhino insures your rental property against any damages or missed rent payments during the lease term. The renters who pass your approval process are always accepted by Rhino after we conduct a soft credit check, which is another way to help streamline your screening.

Plus, Rhino also integrates with property management tools for easy monitoring.

That’s a win-win for everyone involved. Your applicants get a much more efficient and streamlined application process while you can reduce eviction rates and find the residents who want to stay with you for the long term.

*Pricing will vary by individual renter. Actual rates determined based on the specific information provided to Rhino. Monthly payment plans may not be available to all renters.

Monique Seitz-Davis

Monique Seitz-Davis, also known as Moe, is a senior writer at Rhino. Moe thinks glitter gets a bad rap and that security deposits are a trap. Or something. She is doing her best.