If you are a landlord, your tenants are naturally a vital source of your income. Tenant credit checks are crucial for helping you pick reliable tenants who pay their rents on time, every time. Learn how you can make use of this powerful tool today.
How do You Run Tenant Credit Checks on Your Renters?
To get your hands on any potential tenant's credit report, you can approach the credit bureau or credit reporting agency in your country.
If you live in the USA, there are 3 official credit bureaus where you can obtain your tenant's credit reports - Equifax, Experian, TransUnion.
To request for a credit report, you will usually have to submit your applicant's name, address, social security number and your rental property's deed to the credit bureau. In some areas, you must also ask for your applicant's consent to see his credit report and have him sign a written note stating that you have his permission.
You can generally expect to pay $12 to $29 to run tenant credit checks on your potential tenants. This is a small price to pay for the peace of mind that a credit report can give you and we recommend doing it for any new tenants whom you are seriously considering.
What Information will Credit Reports Reveal about Your Tenants?
A credit report will contain a wealth of information on your potential tenant's credit history such as who he owes money to and whether he has been a good boy in paying back his debts on time. These debts include any car loans, housing loans, credit card debts and even installment payments for shopping bills.
These tenant credit checks will also reveal your tenant's employment history and previous addresses. This is highly useful for deciding if your tenants have a stable income from their job type and company. If you are willing to go through the trouble, you can even contact their former landlords to ask them about your potential tenants.
Finally you will gain access to his legal records and dig up any dirt that he may have. If he was involved in any messy lawsuits or had any history of bankruptcy, it will be a red flag to help you recognize potential nightmare tenants.
Are There Other Ways of Running Your Tenant Credit Checks?
Sometimes a credit report is not as useful for certain types of tenants such as students or people who don't have a habit of taking loans and prefer to pay for everything in cash. Naturally these people don't have much of a credit history to begin with.
To have a better idea of whether your applicants will be reliable tenants who pay their rents on time, you can approach their former landlords to ask for their references. Other than asking if your potential tenants paid their rents regularly, it's always important to ask if they were pleasant tenants who kept the rental property clean and tidy.
If your tenants are kind enough to allow it, you can also take a peek at their tax statements which will give you a clear break down of their revenue and expenses. This is also an effective way of running tenant credit checks.
Teo Zhenjie has been showing landlords how to manage their tenants and rental properties effectively on Propertydo http://www.propertydo.com/ - To learn more important tips on tenant credit checks, visit his website today for free step-by-step real estate guides, resources and forms.
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