How to Successfully Conduct Applicant Credit & Background Checks for Your Boca Raton Rental Property

Florida PMServices • July 17, 2020

In trying times, it’s imperative that you provide a home for people and protect your hard-earned investment. A rental background check is one of the most important steps that will help you do both. Looking into a prospective renter’s credit and background details will give you a good picture as to whether they would be someone you’d like to deal with often. After all, the best tenants are the ones who will stay in the property for a long time, pay their rent promptly every month, and take care of the house as if it were their own.

At Florida Property Management Services, we have a tried and tested three-part tenant screening process: background and credit checks, proof of income research, and character screening. Let me tell you more about the first part: how to successfully conduct background and credit checks:

Tenant Background Check

Before you start renting out your property, you need to write down your personal policy on who you’d accept as a tenant. This does not mean that you’ll discriminate against someone based on their race, country of origin, religion, gender, sexuality, or other characteristics. Rather, you need to determine when you should show compassion and where you draw the line with regards to someone’s criminal history.

Would you accept a tenant who had one minor misdemeanor decades ago? Would you accept someone with more than one mark on their criminal record? Would you accept someone with a more serious offense? By answering these questions and writing them down in a policy, you can be consistent in who you accept as a tenant based on the results of their background check. Be sure to have this policy checked by a lawyer as you wouldn’t want to be charged for discrimination. Plus, there may be some laws, such as the proximity of sex offenders to schools and parks, that may affect your property.

Once you have a prospective tenant, the next property management step is to get their written consent to a background check. At this point, you may ask them questions about their history or ask for references from previous landlords.

Afterward, you can do the tenant background check. You can do it yourself if you have the time and energy to do so. You can start with a simple Google search of the applicant’s name with terms like “arrests” or “mugshot”. This search may reveal some things, but not everything. So, it’s best to check other databases.

You can look for arrests and convictions in Florida’s Bureau of Criminal Apprehension database (or its equivalent in a different state, if your applicant is moving from interstate). You can also look at court searches and the sex offender list.

If this sounds time-consuming and confusing, Florida Property Management Service can take the stress away from you. We have a tenant screening service that will thoroughly comb through all the records for you.

Tenant Credit Check

You should also look at your prospective applicant’s credit history before accepting them as a renter. As with the background check, you need to have a policy about credit scores.

At Florida Property Management Services, we consider individuals with scores of 600 and above to be good candidates. This score indicates a minimum of a fair credit rating in both FICO and Vantage systems. They will be more likely to get loans and credit than those with lower scores.

However, you also need to look at the actual history when doing your credit check for renters. Have they had a consistent score or is this a new level for them? What circumstances have affected their credit rating?

As with the background check, you need to know when to show compassion and where to draw the line when doing a credit check for renters. Maybe this person had a bit of bad luck and they’re getting back on their feet again. Maybe they needed a few extensions on their medical bills. Maybe they forgot to pay rent a few times five years ago but they’ve been more consistent since then. A written policy allows you to be consistent with your decisions on who to accept based on their credit history.

Once you have this policy in place and you have written consent from your applicants, you can use a credit checking service. They’ll provide you with a detailed report for you to read. You can then accept or reject the applicant according to your policy.

If you have questions about how to conduct applicant checks or if you need more help, Florida Property Management Services would be happy to serve you. Plus, if your investment is in Boca Raton, Weston, Cape Coral, or nearby; we can help you manage it. Please contact us today.

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