How to Conduct a Background Check for Landlords

Before renting your property to an individual, you can conduct a background check.

As a landlord, you have a right to do a background check on a prospective tenant. This simple procedure will protect your rental property and eliminate the need for eviction. Background checks identify criminals and high-risk tenants with financial problems. Background reports include court and criminal record information, employment and credit check. By reviewing this information you will be able to see how reliable the applicant is. You can find many companies which provide background reports for a small fee.

Things You'll Need

• Completed rental application
• Computer with Internet access
• Credit card or PayPal account

Instructions

1. Ask the prospective tenant to fill out a rental application and provide personal information, as well as rental references. Collect the application fee that will cover the background search cost. Ask the applicant to sign an authorization for you to conduct a background search.

2. Contact the references and ask if the tenant paid rent on time, if he left the property in order, if there were any misconduct reports, such as noise. Inquire if they would recommend this tenant. Also verify employment. While employers will not provide salary or other personal information, you can verify if the applicant works there and if so, how long. If the applicant doesn't have any rental history and rental references, you can ask for an additional deposit or request a co-signer. If he has a steady, sufficient income, good credit history, he will likely be a good tenant.

3. Go to rentalbackgroundcheck.org or search for other companies that do background checks for landlords. Enter the applicant's information, pay the fee and get the report. The information on the report will help you decide how reliable the applicant is and if your property will be in good hands.

4. Give the applicant a letter of approval. You can request a higher security deposit or a co-signer if you see some negative information in the report.

5. Provide the applicant with a letter of denial. The letter must contain the name, address and phone number of the agency that supplied the report. According to the Fair Credit Reporting Act (FCRA), the individual can dispute the information reported within 60 days.

Tips & Warnings

• Avoid discrimination reports by basing your decision solely on the application information and the background report. Avoid making your decision based on gender, race, religion, age, sex or ethnic background.

• According to the Fair Credit Reporting Act, the information on the consumer report is confidential and should not be shared with anyone who is not in the position to make decisions regarding the prospective tenants.

References

• Federal Trade Commission: Using Consumer Reports: What Landlords Need to Know
• Quality Tenant Screening Center-FAQs
• Protect Your Rental Property Investment with a Tenant Background Check