Some landlords consider the “right tenant” to be someone who has a near-perfect credit score. They base their tenant approval decisions based on the concept that if someone has an excellent credit history, then they are sure to be financially stable. While credit scores are important, they don’t tell the whole story. A landlord may pass up on an otherwise fantastic tenant if there’s a lot of importance placed on their credit score. Understanding the other factors to look for when screening applicants can help recognize great tenants at once.
When screening rental applicants, property owners have every right to know more about the tenant’s financial situation. A credit report can show a bunch of information beyond a simple credit score, information that an owner can utilize to identify whether or not the tenant is able to make their rental payments in full and on time. For example, late payments on an account that is now current can bring a credit score down but also shows the applicant is now paying their bills on time.
While a previous vehicle repossession or a credit card charge-off is a significant issue for some property owners, it is critical to remember that numerous people suffered several years ago due to the Great Recession. Through no blame of their own, they may have lost their jobs or homes, but have since regained stable employment and maintained their credit accounts well. On the other hand, maybe a past medical emergency caused the applicant to fall behind on their medical bills or student loan payments, but they’ve made good financial choices since then. In these circumstances, the score may be a less crucial factor than the tenant’s payment history over time. A couple of errors many years prior ought not to disqualify an otherwise solid applicant.
To understand the entire picture, it’s important to gather information from the applicant that is not on the credit report itself. In the event that the potential tenant has a valid justification for their lower credit score, such as those listed above, that may be a reason to keep them under thought. Likewise, property owners should always supplement an applicant’s credit report with references who can express to their potential. If an applicant has a strong history of paying rent on time and a stable income, these factors may be better indicators of how they would do as a tenant than numbers on a credit report.
Tenant screening can be a complex process, especially for single-family rental homes in Sterling Heights. Property owners mostly want someone who will be a stable, long-term tenant, making the decision an even more critical one. At Real Property Management Silverstone, we conduct a thorough screening on every applicant, from credit reports and beyond. Our property management professionals get what to look for, and how to choose the right tenant for every rental property we manage. If you would like to learn more about our screening process or would like to speak to someone, please contact us online or by phone at 586-992-6419.