As a landlord, few situations are more frustrating than dealing with a problematic tenant. From damage to your property to constant late or missed payments, bad tenants can cause a range of problems that affect your income, your business and your quality of life.
Remember, while landlord assistance will you protect you from the unpredictable side of being a landlord, it doesn’t always protect you from the frustration a bad tenant can cause. Tenant screening might be just what you need.
Just like it’s important to screen candidates for a job, it’s important to screen potential tenants to make sure they’re a good fit for your rental property. Below, we’ve listed red flags to be aware of when you’re considering a potential tenant, from bad finances to signs of dishonesty.
One of the most reliable red flags for a bad, unreliable tenant is any kind of criminal history. If a potential tenant shows you a basic Disclosure and Barring Service (DBS) check that shows one or several criminal convictions, it’s usually best to consider their application very carefully.
While not all people with criminal convictions are bad tenants, this is a major red flag that should be taken seriously to protect your property and help you avoid any potentially difficult situations as a landlord.
A bad credit report is arguably the most reliable indicator that a potential tenant isn’t going to be a good match for your property. After all, if someone rarely pays their bills on time and just can’t seem to manage their finances, how can you expect them to reliably pay rent?
Everyone has a different definition of “good” credit, meaning a score that’s acceptable to many landlords might not be good enough for you, or vice-versa. In general, it’s best to go with your gut — if their credit score doesn’t seem like a good match for your property, it probably isn’t.
A low income is another obvious indicator that a potential tenant isn’t a good choice. Just like a bad credit history, a low income is a fairly reliable sign that a potential tenant might struggle with paying rent on time.
Most of the time, a person’s income should be at least 40 times the monthly rent of the property they’d like to inhabit. For example, a home that costs £3,000 per month should generally only be leased to tenants with a combined income of at least £120,000 per year.
While there might be certain situations in which a low income is acceptable (for example, if the potential tenant has recently moved to the area and is unemployed, yet has significant savings), an annual income that isn’t at least 40 times the monthly rent is generally a major red flag.
Previous evictions or problems
Before you consider any tenant, it’s best to ask them to provide references from their previous landlords. While references aren’t as reliable as a credit report or a criminal background check, they can help you get a fuller picture of a tenant’s normal level of care for a rental property.
Some key questions to ask include whether or not the tenant was evicted in the past, whether they caused any problems or if they left any of their previous homes in a state that required a part or all of their deposit to be retained by the landlord.
Finally, beyond the financial aspects of tenant screening, it’s important to make sure they’re a good match from a personality perspective. Do they seem like the type of people who will take care of your property? If there’s an issue, do you think they’ll be fair and reasonable?
Do you feel that they might not have been completely truthful with you? Small things, such as seeming overly nervous about a credit check or avoiding going into detail about their job can signal that a tenant might not be completely honest.
Remember, the tenant (or tenants) will be inhabiting your property for the lease term, and you’ll be depending on them to pay rent and take care of your property. If you feel that someone isn’t a good match for your property based on their attitude, there’s a good chance you’re right.