Watch TV long enough in the evenings, and you will eventually see an advertisement for free consumer credit checks. Along with a fun jingle, there is usually reasoning behind why you should know your credit score. In the world of rental property and property management, you should also know your tenant's credit history. For this reason, it’s important to make a tenant credit check a part of the application paperwork. In this article, we'll briefly look at the what, why, and how of a tenant credit check and how VerticalRent can help you build this into your rental agreements.
What is a Tenant Credit Check
On one level, the tenant credit check is self-explanatory in that it is an inquiry into the nature of a potential tenant's credit history. With services like those provided by VerticalRent, you will be able to see and assess the tenant's credit score and the contributing factors to that score. A tenant credit check will give you an analysis of all the factors, including current and previous addresses and employers, payment history and revolving credit, and public record filings. Easily manage all of this with VerticalRent's industry-leading property management software.
Why Do I Need to Require a Tenant Credit Check
The world of being a landlord is a calculated risk. Each time you take on a new tenant, you are betting on the risk of the tenant failing to meet his end of the bargain is less than the reward of having a quality tenant who pays on time. A credit check can help take some of the risks out of the decision. The ability to look at a deep dive of the potential tenant's credit and see how they have financially behaved can help you assess their fit as a tenant for you. At the very least, it can give you the insight to ask more questions or clarify details. It can also give you a sense of what percentage of their income will be spent on monthly rent for your property, giving you a snapshot of their ability to afford it.
How Does the Process Work
VerticalRent helps you populate the initial request, and we recommend that landlords include the fee as a part of the initial rental fees, so that the tenant credit check comes at no cost to you. The potential tenant then enters the information, and the information gets shared with you in a detailed assessment. From our property management software, you can even notify the applicants of your decision and how you will be proceeding. And if denial of the application is the best option, you can do that through our system as well.
Helpful information at no cost to you. Sound like a deal? We thought so, but it will not only be a great deal, it will ease the stress that can come with property management and deal with tenants. Visit VerticalRent to see why over 50,000 landlords, brokers, and property managers use our services.