Verifying Tenant Payment and Financial History
The tenant credit report is a useful tool for determining what types of debt your applicant uses, how much debt is outstanding, and how the debt is paid and managed. Don’t just look at the tenant credit score, that is a useful tool but not the only one. How many credit cards are in use, what is their balance, are there missed payments, is the debt growing or declining? How many recent inquiries are reported. There are different types and purposes of debt – do you want to be more forgiving of medical debt or student debt? Would you accept applicants with a prior bankruptcy? Have a plan in mind so you don’t fall into a victim trap.
“Potential Gotcha”: Universally most landlords don’t want to rent to someone who owes a prior landlord – but this type of debt is rarely on a standard credit report (read more blogs to understand why). Call the current landlord — and prior landlords — this is essential homework that a standard credit report doesn’t really help with. Prior evictions will be shown, but these take time to work through the courts and records. If someone is not paying their landlord now, they are probably looking to move now, and this will not show on your credit report in collections or evictions yet. Collections can be hard to uncover due to the time delay, and you have to really know what you’re looking for. The type of debt being collected is rarely clearly stated.
Rent Marketplace helps independent landlords and local property managers save time and money with our one-stop shop solution suite. With integrated online rental applications, tenant screening, state-specific leases and more, landlords can find and move in better residents faster, while going paperless.