Use Background Checks To Increase Rental Rates

How to Use Background Checks to Increase Rental Rates

Blemishes in their past? Maybe you don’t have to turn them away.

As a landlord, you have a lot on your plate. Even if you enlist the services of a management company, you still have to ensure that your tenants are upstanding people who will not only take care of your property, but will also abide by the rules and pay their rent on time. Running background checks on potential tenants has become a common practice among owners of rental properties and doing so affords you several benefits, including the ability to increase rental rates.

A good prospect with bad credit

Everyone makes mistakes and sometimes that includes not paying bills on time. Whether it was because of financial strife or because they were young and irresponsible, the reality is, those mistakes can stick with someone with years of bad credit. So if a background check reveals less than stellar credit, but also shows that this person is exactly who they say they are, has a job, has no criminal activity in their past and is able to pay the rent, why not give them a go? This is plausible especially if you can base their monthly rate on their credit risk by charging them a bit more.

A mishap or two in the past but a promising future

Background checks are ideal for identifying those people who may not be tenant potential. Nobody wants a dangerous criminal living on their property after all. But what about those who may have made a bad choice years before, but have since cleaned up their act and have never been in any trouble again? In this case, you may want to give this potential tenant an opportunity and simply charge them a little bit more per month. If they want a fair chance they are likely willing to pay a little more to live in a nice place that offers them what they need.

An eviction?

So what do you do when your potential tenant’s background check comes up with an eviction in their past? It’s troubling for sure. But depending on how long ago it occurred and what the circumstances were, you may be able to allow this person to rent from you at a higher rate and with an increased security deposit. If there are no other red flags, issues with their credit history, or any criminal activity, you may find this person a good fit as a tenant.

For landlords, knowing that your tenants will be responsible, pay on time, and respect the rules as well as be respectful of the other tenants on the property is key. Running background checks is one surefire way to determine whether each potential tenant is someone you wish to rent to. Depending on the results you get, you may even be able to collect more rent and/or a higher security deposit from those who may be a higher risk.

If you are looking for a background screenings service provider, talk to us. We are industry leaders, and provide an array of services tailored to your needs.