In the past few years the rental industry and the tenant selection process within that arena has seen humungous change that has complicated how landlords can go about leasing their available units. Parts of this process such as performing criminal background checks on potential tenants now has to be performed a certain way in certain jurisdictions within the USA. These laws are not always consistent from one location to another and this makes the apartment rental process much more confusing for landlords. However, it is even more complicated and daunting to people becoming new landlords.
Recent laws being enacted across the country sometimes place limits on how far back landlords can look into a potential new tenant’s criminal history and/or eviction record history. Some places in this county even have laws regarding leasing decisions based on bad/poor or no credit history. Now more than ever new landlords need to do their due diligence before starting the leasing process. A best strategy would be to utilize a third-party tenant screening agency to help assist in remaining compliant with all laws pertaining to the tenant selection process.
Many people now in certain situations are considering becoming landlords. For instance, when their kids leave the coop it may be time to downsize. But the best option may be to keep the house and rent it out. Or perhaps there is a nest egg to buy a small rental property, an investment to create additional income. Or, maybe, the apartment over the garage is finally cleaned out and ready for a renter.
So you want to be a landlord?
There are a number of things to take into consideration before becoming a landlord. There’s the expense in the original investment, maintenance of the property, and finding a renter.
And conducting a tenant background check.
Being a landlord is no simple task, one that requires patience and persistence. And an important part of being a landlord is fully vetting all tenants. A best practice for tenant screening is to work with a well-qualified third-party tenant screening agency to remain compliant with all law. And, keep in mind, laws can change frequently.
Additionally, screening a tenant helps protect property and the investment. Investing in a rental property is a big financial commitment and one does not want to threaten financial standing through a bad tenant.
From Bizrate.com (Oct 4, 19):
Being stuck with a bad tenant can not only disrupt your cash flow, but it’s also one of the reasons landlords fail.
“People don’t screen their tenants adequately. One bad renter can ruin you,” … This can be especially true depending on your state’s landlord-tenant laws. bankrate.com/real-estate/becoming-a-landlord-do-you-have-what-it-takes-to-manage-property-and-people/
Laws that govern tenant screening and reports utilized therein are often complicated and can change frequently. For a new landlord it can be overwhelming.
From Bizrate.com (Oct 4, 19):
It is important to “always know and understand your federal, state and local rental laws,” … “Many landlords learn the hard way that not being knowledgeable about the laws can end in costly lawsuits or lost rental income.”
The U.S Department of Housing and Urban Development (HUD) Fair Housing Act prohibits housing discrimination based on race, color, national origin, religion, sex, disability and familial status. In addition to federal discrimination laws, each state and city will have specific landlord-tenant laws and regulations.
“Knowing the law will help you stay in complete compliance with regard to safety issues,” … “Not knowing will not protect you from legal action.” Ibid.
Being a landlord can be very rewarding, as long as you have the tools to do it. Adding a tenant screening agency to your tool box is a best practice.
Because of the wide spread affordable housing crisis in many places in this country new landlords may want to build or buy apartments that are affordable to help curb homelessness and to quickly fill their units with tenants.
Working with a tenant screening agency is critical and well worth it. The cost of not being in compliance is far higher than a simple tenant check. Additionally the cost to perform a thorough tenant check is negligible compared to the monthly rental income profits.
To learn more about the pitfalls of becoming a landlord and why it is imperative that all landlords understand the laws regarding the tenant selection process and why partnering with a tenant screening agency can greatly assist in remaining compliant with those laws read recent TenantScreeningUSA.com press release: So You Want to be a Landlord?