Screening your potential tenants is an important step in a rental business. It helps you identify quality tenants and reduce the risk of financial loss. As crucial as it is, there are right and wrong ways to go about it. Missing key practices in Texas can lead to legal or ethical problems. Below are some tips that can help with the tenant screening process.
What To Do During the Tenant Screening Process
Learn About Important Laws and Codes
There are a few rules you and other Texas landlords must abide by before beginning the screening process. For instance, Texas Property Code Sec 92.3515 requires property owners to provide written notice containing a tenant criteria checklist and have the acknowledgment form signed before they can start screening tenants. There are also fair housing laws to keep in mind. These ensure that landlords or property managers are complying with federal and state regulations. Those are just two of many legal requirements that can easily be overlooked, so be sure to be thorough.
Use Credible Screening Services
It would be difficult to do the screening process all on your own without the help of available screening tools. There are screening services you can use to conduct background checks, but the easiest route would be to hire a property management company to do that for you. Austin Property Management has tenant selection criteria based on factors like credit history, eviction history, employment verification, criminal records, debt-to-income ratios, and feedback from previous landlords.
Verify the Information
Fraud is a real threat. A prospective tenant can provide inaccurate or incomplete information to pass the landlord’s tenant selection criteria. Providing fake identification allows them to hide their real credit history, criminal background, monthly statements, employment history, rental history, and other data that can deny their rental application. You can use independent sources for verification, all while minding Texas landlord-tenant laws, of course.
Document the Process
Keep all records made during the entire process for your tenant screening report. These can serve as valid documents in a legal process if you land in a legal dispute after you reject tenant applicants' lease agreements. That includes even minor details like the application fee, and essential ones like criminal background checks, credit reports, and the rental properties applicants plan to lease.
Update the Tenant Screening Criteria
Regularly update your tenant screening criteria to reflect the changes in the Texas market, legal requirements, or rental properties. As the property owner, it's your responsibility to inform prospective tenants of the factors that will affect the tenant screening background checks. This will ensure that you will get reliable tenants for your residential properties in the future as well.
What Property Owners Need to Avoid
Discriminating Against Tenants
Whether it's done knowingly or not, discrimination against tenants based on protected characteristics such as race, religion, color, national origin, sex, disability, or familial status can be grounds for a lawsuit since it goes against Texas fair housing law. Thorough tenant screening is crucial, but it should be done without bias. A landlord only needs the tenant to pass their background check and tenant screening to approve the rental application.
Overlooking Red Flags
Some landlords overlook a few setbacks in the tenant screening process or background check such as criminal history or credit checks when the applicant seems trustworthy enough. There's a reason why these tests are in place. It protects your investment property by making sure you get the best tenants who respect lease terms. This can save you from potential tenant evictions in the future.
Rushing the Screening Process
Part of the responsibilities of property ownership in the rental business is to make sure that the landlord is meticulous in tenant screenings. Rushing the process can cause you to miss key factors like criminal history. Ensuring that you only rent your Texas properties to qualified tenants is the beginning of good property management.
Missing Local and State Laws
Missing just one Texas real estate law can be disastrous for the landlord and the rental property involved, which is why consulting a lawyer to provide legal advice or hiring a personal property manager may be the best way to go. A property management service based in Texas will have the needed legal knowledge to conduct the tenant screening and background check for prospective tenants.
Neglecting Tenant References
Background checks and tenant screening processes also involve calling the tenant's previous landlord. This can provide you with an idea about how they treated the rental property and followed the lease agreement before. Doing this first can even save you a whole lot of time since a bad reference can mean that you don't have to go through the selection criteria anymore.
Should You Hire a Property Management Company Instead?
Property management services can save you a whole lot of trouble down the road, whether it's to manage the day-to-day tasks that come with being a property manager, or the more complex responsibilities in the real estate industry that involve local and state laws, codes, and regulations in Texas. Property management can be a full-time job, which is why hiring a property manager in Austin, Texas to handle your rental property can take a load off your shoulders.
Our Tenant Screening Process Goes Above and Beyond
Aside from the basic screening factors like rental history, credit checks, eviction history checks, criminal background checks, debt-to-income ratios, and calls to previous landlords, we also verify the identity of the tenants to make sure that the screening process is valid. We guarantee that a landlord will get tenants from Austin who have a history of paying their bills, afford properties, and be responsible for the unit they'll be leasing. To show how confident we are with our screening service, Austin Property Management will cover the filing cost for all court appearances and find a new tenant for you at no cost.
What Our Property Management Company Can Do For You
Looking for the best property management company for your rental property can be a difficult endeavor, but you can start by looking into what the company can do for you. Austin Property Management offers a variety of real estate management services in Texas such as:
- Marketing
- Tenant Screening
- Rent Collection
- Maintenance
- Accounting
- Evictions
- Online Portal for Landlords and Tenants
Our service aims to maximize the potential of your rental properties in Austin and make the most of your investment. You can get started right now by checking the return on your investment using our free ROI Calculator, or determine how the loss of tenants can affect your rental income through our Vacancy Loss Calculator.
