Blog

 
     

What Can a Landlord Include in a Tenant Background Check?

By Michael Klazema on 7/24/2019

There are several reasons for a landlord to conduct a background check on every prospective tenant. These checks can help determine whether a tenant will be respectful, safe, trustworthy, and able to make rent payments. They can also help spot red flags that might indicate a “bad tenant,” such as a history of violence that could represent a threat to neighbors or ruinous credit that may reveal a financial inability to make payments.

What does a tenant background check include, and how can this information help a landlord make smart decisions about who to trust?

At backgroundchecks.com, we team up with TransUnion—one of the three major credit reporting bureaus—to offer landlords a convenient online system for tenant background screenings. This service, called SmartMove, includes the following elements in each background check.

  • Credit Report: Credit scores and credit history are important considerations for landlords seeking reliable tenants. By showing payment history, credit utilization, credit availability, and overall credit score—among other factors—a credit report gives a landlord a sense of a prospective tenant’s financial reliability. A bad credit report might indicate a tenant who won’t be able to make payments on time while a strong credit report helps dispel financial concerns.

  • Income Insights: In addition to understanding their credit, landlords like to know that their tenants are gainfully employed or have a stable income. An income insights report can show the landlord how much money a prospective tenant makes per month and how large a percentage of that income would be taken up by rent. A lower rent ratio is more manageable for a tenant, which can instill confidence in the landlord. Higher rent ratios may indicate a tenant who is trying to rent outside of their financial means.

  • Criminal History: Criminal history checks can help landlords protect themselves, the property that they own, and other residents in their building or in nearby properties. A prospective tenant with a history of violent crimes or sexual offenses may pose a threat to residents and neighbors. A landlord might also reject a tenant who has been convicted of serious drug possession or methamphetamine production to avoid a situation in which their property is used for this damaging and dangerous process. For these reasons and others, criminal history searches are an important component of any tenant background check.

  • Eviction Reports: Rental history is another important component of the tenant background screening process. A tenant who has been evicted from a property in the past may be a risky bet for a landlord. In general, rental history can be a good indicator of the kind of renter a tenant will be. Evictions are black marks on this record.

In addition to these screenings, a tenant background check might include reference checks (including communications with old landlords), address history checks, and alias checks. The latter two searches can help flesh out the criminal history screening process significantly by helping tenants to ensure that they are pulling background information for the correct individual in the most relevant geographic regions.

Are you a landlord looking for a way to vet potential tenants? Try SmartMove today.

 

Sources: https://www.rentprep.com/tenant-screening/rental-background-check/


Tag Cloud
Categories
Recent Posts

Latest News

  • August 15 Background checks aren't a silver bullet that solves every concern about prospective new hires—they are a tool that must be used with care. How can an incorrect approach lead to inadequate vetting? 
  • August 13 How has legislation and regulation changed the way employers use criminal background checks? We look at some of the rules that modern companies must follow.
  • August 08 With many industries facing labor shortages, advocates and legislatures are reconsidering policies that exclude potential employees. Expansion of record expungement and "ban the box" rules could change the system. 
  • August 06 Continuous background screening or ongoing criminal monitoring is the best way to keep track of critical new developments on an employee’s criminal record. Learn how these background checks work. 
  • August 01

    A new lawsuit filed in New York alleges that department store chain Macy’s ignored federal hiring guidelines and laws, firing individuals for old and non-job-related criminal convictions. 

     

  • July 30 The Minneapolis City Council is considering a series of ordinances that would regulate the use of tenant background checks and security deposits. The city’s tight housing market has made it difficult for individuals with bad credit, eviction histories, or criminal records to find housing.
  • July 25 Following revelations about wrongdoing in USA Gymnastics at the hands of team doctor Larry Nasser, sports organizations must grapple with how to safeguard their members. Some have found more success than others. 
  • July 24 What do landlords want to know before accepting new tenants? Here are the basics included in the average tenant background check.
  • July 23 7-Eleven will pay nearly $2 million to settle a class-action lawsuit concerning its background check process. The lawsuit alleges that the convenience store chain violated the FCRA with its background check disclosure document.
  • July 22 Social and child service organization rely on background checks to vet employees, sponsors, drivers, and other staff members and volunteers. By helping to root out histories of violence, sexual abuse, and other red flags, our resources assist these organizations in keeping the people they serve safe.