Are you a real estate investor in Atlanta, GA? If so, you have a great opportunity to make money by converting these properties into rentals.
Of course, being in the right place is only one part of success. The other part: finding the right tenants to occupy your new rentals. With so many viable applicants in the area, this is a harder task than it may seem.
Not sure where to start? Here's our short guide on how to screen potential tenants and save yourself a lot of trouble!
Create a Rental Application
First, create a rental application form that sets expectations for your tenants. That way, you help people determine if they're interested in the property—and if they qualify for it—before you even meet them.
Important questions to ask in your rental application include:
- Basic contact information
- Social Security number
- Income sources
- Pet information
- Smoking information
Run a Credit and Background Check
Credit and background checks are an essential part of tenant screening. The credit report allows you to see if the tenant can afford their expenses. It also helps you catch any financial problems before they arise.
A background check determines if the tenant has a criminal history. That often includes checking terrorist and sex offender registries. Consider hiring tenant screening services to avoid denying a tenant over data errors.
Verify Employment and Income
Job stability and salary are solid indicators of good tenants. You can verify these in several ways, such as pay stubs and tax returns. If possible, contact their current employer to confirm their job status.
While verifying the tenant's income, focus on the three-times rule. For a tenant to qualify for your rental, their monthly income must be at least three times the rent. In some areas, you may want to increase this number.
Check Previous Addresses
Another way to screen a tenant is to check in with their previous landlords. Ask questions such as:
- Did the tenant pay rent on time?
- Were there any complaints from neighbors?
- Did they take good care of the property?
- Would you rent to them again?
A recent landlord likely has a valuable perspective on whether a tenant is worth the trouble. In some cases, of course, they might have caused more problems than the tenant. To be sure, interview a few landlords.
Interview Your Applicants
If a tenant passes all the above checks, all that's left is to interview them. While doing so, don't forget the Georgia Fair Housing Act. This law prohibits discrimination based on race, religion, gender, disability, status, or origin.
During an interview, focus on learning more about the tenant. For example, ask them why they're moving or how long they plan to live there. You can also verify their references and other information.
This Is How to Screen Potential Tenants
With a robust screening system like the one above, it will be much easier to find good tenants. Remember: it's always better to forego a potential tenant than rent to a bad one. If you're having doubts, look elsewhere.
Struggling to screen potential tenants? If you're based in Georgia, consider outsourcing this task to our real estate management services! Click right here to learn more about what we can do for you.