Webinar - Tenant Screening 101 · 2015-12-16 · AGENDA 1. Screening Basics 2. Discrimination Laws...
Transcript of Webinar - Tenant Screening 101 · 2015-12-16 · AGENDA 1. Screening Basics 2. Discrimination Laws...
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WELCOME1. Familiarize yourself with the Control Panel
2. Q&A will occur at the end
3. This webinar is being recorded
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BY LUCAS HALL
TENANT SCREENING 101 A STEP BY STEP GUIDE
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AGENDA1. Screening Basics
2. Discrimination Laws
3. My 1 Hour, 9 Step Process
4. Handling Less-Qualified Applicants
5. Bonus Resources
6. Q&A
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MY STORYLucas Hall, PMP • Landlord, 10+ yrs
• 5 Properties / ~17 Tenants
• Founder, Landlordology
• Community Mgr, @CozyCo
• Not a Lawyer
• Puppy-daddy
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Free Property Management Software
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SCREENING BASICS
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SCREENING BASICS1. Able and willing to pay rent?
• Income = 2-3x Monthly Rent
• Able = Job / Income / Cash
• Willing = A sense of moral and fiscal responsibility
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SCREENING BASICS2. Everything else can be, repaired,
evicted, or mitigated
3. More info is not always better
4. Set approval criteria before you advertise
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SCREENING BASICS5. Automate your listings and
applications
6. Check Government photo IDs
7. The type of debt matters
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SCREENING BASICS8. Top 5 red flags:
• “Can I pay in cash?”
• Illegal drug use,
• Violent crimes,
• Fraudulent IDs
• Filthy person or car
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DISCRIMINATION
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DISCRIMINATION1. Set approval criteria and treat
everyone equally
2. Memorize the “Federal 7” and your State/Local protected classes
3. When in doubt, consult an attorney
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PROTECTED CLASSES*1. Race
2. Color
3. Religion
4. Sex
5. Familial status, incl. children or pregnancy
6. National Origin, or
7. a Mental or Physical Disability
* Fair Housing Act,1968, Most states have extra classes
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SCREENING PROCESS
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1. Pre-screen Inquiries (10 mins) 2. Property Tours (30 mins) 3. Applications & ID Verification (15 mins) 4. Proof of Income/Employment (10 mins) 5. Landlord References (15 mins) 6. Credit Report/Score 7. Background Check 8. Sex Offender Database 9. Consider the Entirety of All Applicants (10 mins)
9 STEP PROCESS
(10 mins)
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INQUIRIES1. Pre-screen with a quick phone call
2. Phone calls avoid discrimination
3. Ask about income, savings, debt, credit, pets, hobbies
4. Let them talk and ramble
STEP 1 (10 mins)
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PROPERTY TOURS1. Host a “Landlord’s Open House”
2. Did they arrive on time?
3. Ask open-ended questions • Why are you interested in this place?
• Why are you moving?
• Can you describe your ideal lease agreement?
• Can you describe your current job?
• Check out their backseat (Trunk Junk Test)
STEP 2 (30 mins)
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APPLICATIONS & ID VERIFICATION1. Use online applications
2. Collect applications from all adult occupants / co-signers
3. Check ID, and verify through credit
4. Use Social Media and Google
STEP 3 (15 mins)
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INCOME / EMPLOYMENT 1. Proof of Pay stub
• Applicant Name
• Current Address
• Monthly Income
• Employer’s Name
• Year-to-Date Earnings
• Garnishments and Child Support
2. Bank Statement
STEP 4 (10 mins)
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REFERENCES Call the past two+ landlords
• What were the start and end dates of the lease?
• Were there any late or partial payments?
• Were there any noise violations or disturbances?
• In what condition did they leave the property?
• Did they try to sue you?
• ***Would you rent to them again?***
STEP 5 (15 mins)
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CREDIT REPORT / SCORE 1. SSN#, not required - soft inquiry
2. All three credit bureaus provide services for landlords
3. Score = 700+ is best. Experian = 330-830, TransUnion = 300-850, Equifax = 280-850
4. Don’t accept paper credit reports
STEP 6 (10 mins)
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BACKGROUND CHECK STEP 7 (10 mins)
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MY STANDARDS1. Income = 2-3x rent
2. No evictions, ever
3. No convictions last 2 years
4. No violent / armed crimes, ever
5. No or low credit card debt
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SEX OFFENDER DATABASE Sex Offender is not a protected
class; www.nsopw.gov
STEP 8 (10 mins)
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THE BIG PICTURE 1. Consider the entirety of all applicants
2. Other considerations:Lease duration, Cars, Pets, Hypochondriacs, Hoarders, Complainers, Hobbies
3. It’s a business decision
4. First qualified applicant recommended but not required
STEP 9 (10 mins)
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LESS QUALIFIED APPLICANTS1. Require a larger deposit
2. Require rent to be paid online, and automatically
3. Require a co-signer
4. Require a lump sum payment
5. Check your state laws for limits
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RESOURCES
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LIFECYCLE
The Landlord LifecycleA comprehensive checklist of phases when renting a property
landlordology.com/lifecycle
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PODCAST
Ask LucasA Q&A Podcast about Landlording.
AskLucas.com
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© 2012-2014 Cozy Services Ltd. All rights reserved.
www.cozy.co
(IT’S FREE)
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QUESTIONS?