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How To Find Better Tenants

Hugh Grant

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How To Find Better Tenants

One of the most critical parts of owning rental property or being a property manager is finding good tenants. Having tenants who pay on time and don’t damage the home or unit means more profits and fewer headaches.

But it’s easy to say you need better tenants – how do you do it? All you need to do is remember the tips outlined here and you’ll be on your way to finding great tenants that make you more money.

Abide Fair Housing Rules

The first rule for getting good tenants is following the law. The federal Fair Housing Act states you cannot make renter decisions according to gender, race, religion, family type, or sex.

There are ways the government can check that landlords follow the Fair Housing Act. One way is they will call For Rent ads and make it clear that the are a minority or not. If you rent a unit in one case and not another, you could get in hot water.

Get A Bigger Security Deposit

If you take a larger deposit, this will help to cover serious damages if they happen. Many investors recommend taking a security deposit that is a bit higher than their monthly rent.

One reason you ask for more money is the renter won’t assume that the security deposit is their last month’s rent. You need to be sure you are paid for the last month.

Meet Every Tenant In Person

You should meet every potential tenant in person. You never know what you are getting if you only go by text or phone calls. Seeing the person with your eyes can give you a better idea if the person will pay on time and respect the property.

You may be able to see if they are likely to be clean and tidy by noting the car they drive. And sometimes you get a gut feeling by how the prospective tenant acts during the walk-through.

Call All References

Asking for references doesn’t do any good if you don’t check every one of them. This means you should check with their previous landlords, who employs them, and personal references.

The more people you check with, the better the idea you will get if you should rent to them. Checking they are regularly employed and weren’t late on rent with previous landlords goes a long way.

Also, ask previous landlords if they were clean and weren’t responsible for major property damages.

Do A Background Check

Some landlords don’t go to the time and trouble to do a background check. But doing so will help you head off trouble.

A popular system is Transunion’s background check tool. This allows you to check their background without taking their social security number, which can open you to liability issues.

You simply create the account with Transunion and send every prospective tenant the link. The renter inputs their information into the website and you don’t have to deal with any of it. The portal simply tells you if the person will be a good risk or not.

Don’t Lower The Rent To Fill A Unit

You might be tempted to lower the rent to fill a unit faster. But dropping the rent drops the quality of the renter pool. You’re asking for trouble if you lower the rent because you will have more questionable people applying.

You are better off with an empty unit for two months than dropping rent $100 for a tenant. That move could cost you a lot of money in the long run.

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