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Online rental applications help you learn more about prospective tenants interested in applying for your rental property. But to get more visibility on their credit score and financial habits, you will need to run a credit check.
We outline how to run a credit check on a tenant using a property management software platform like Avail and answer common questions about credit checks.
What Information Is Needed to Run Credit Checks on Tenants?
Before running a credit check on tenants, there are a few steps you’ll want to take. For one, applicants must be over the age of 18 to submit a rental application and authorize a credit check. You must also follow the Fair Credit Reporting Act guidelines and ensure your state allows landlords to request credit checks to avoid violating landlord-tenant laws.
To begin the process, you’ll need the following information:
- A rental application: You can request a rental application to learn more about applicants, such as their full legal name, if they have a social security number or individual taxpayer identification number (ITIN), their date of birth, residential history, and landlord references.
- Applicant authorization: An applicant will need to authorize a credit check during the tenant screening process. If they’re unable to authorize a credit check with an SSN or ITIN, you may need to explore other methods to properly screen them.
- Landlord verification: Most credit bureaus require proof that you’re indeed the landlord for the rental property the applicant is applying for. You may need to provide proof of residence, proof of identification, or proof of rental property ownership.
How to Run Credit Checks on Tenants With Avail
You can easily run credit checks on multiple prospective tenants through Avail. Here are four steps to request credit checks during the tenant screening process.
1. Create a Landlord Account
To screen tenants, you’ll need to create an Avail account as a landlord and add your rental properties. It’s important to note that you will need to set up the rental property a prospective tenant is applying for before you can request a credit check.
Avail is free for both residential and commercial properties, but you can upgrade to Unlimited Plus for $7/unit per month to access additional benefits like waived ACH fees, as soon as next-day rent payments, and lease cloning.
2. Navigate to Your Applications to Customize
When you create an account, you can access our online rental application template and add a request for tenant reports like a credit check, background check, or eviction check. As a reminder, it’s advised to refer to local landlord-tenant laws to better understand which reports landlords can request from tenants. If you discover that your state does allow credit checks, you can adjust the settings of the rental application to include a TransUnion credit check.
States vary in how much to charge to run a credit check, but this fee is typically covered by the applicant. You also have the option to cover the cost yourself, if preferred.
3. Request Applicant Authorization
Your tenant will receive an email with easy-to-follow instructions on how to complete an online rental application and authorize a TransUnion credit check. Rental applications can take a few days to process, depending on how fast the prospective tenant submits their information. It’s important to note that credit checks requested through Avail will show as a soft credit check, meaning it won’t affect the applicant’s credit score.
Once they’ve completed both steps, the results will automatically populate to your dashboard to review their information for up to 30 days.
4. Review Applicant’s TransUnion Credit Report
Once receiving the credit check, you’ll be able to review their credit score, credit usage, account summaries, and tradelines. You can also see if they have a strong history of making on-time payments or if a majority of their income is going towards debt repayment.
Based on the provided information, you can determine if you want to approve or deny their application based on your criteria.
How to Read a Tenant’s Credit Report
A credit report includes tons of information on an applicant’s credit habits, from how much available credit they have to their usage. However, it may be more helpful to focus on an applicant’s credit score and payment history.
Credit scores are based on various factors, so it’s important to understand why they have the score they do and which factors are impacting their score the most. Is it because they missed payment dates in the past or do they have a low amount of established credit? The answers to these questions can help you better understand their credit score. You may also want to look at their payment history to see if they have a strong history of making on-time payments.
If a tenant does have a low credit score, you may want to see if they’ve done the work to improve their score the past few months or if they continued to get negative remarks.
What If a Tenant Cannot Authorize a Credit Check?
If a tenant cannot authorize a credit report, there are still ways to understand an applicant’s financial habits. You can request the following documents in addition to their application:
- A credit reference
- A landlord reference
- Monthly bill statement
- Bank account statement
- Pay stubs or offer letter
You also have the option to add five additional questions to an Avail rental application with Unlimited Plus to learn more about an applicant.
It’s important to allow all applicants a fair chance to apply for your rental to avoid violating Fair Housing laws. If a tenant is unable to authorize a credit check, then it’s advised to explore other options instead of immediately rejecting their application.
How to Handle Rejecting a Tenant Due to a Poor Credit Report
Before rejecting an applicant, it may be helpful to ask them questions on their rental application or credit report to get more context on the issue — especially since both can include errors.
However, if you’ve determined the applicant does not meet your criteria, you can suggest the tenant finds a co-signer or guarantor to get approved or provide a tenant rejection letter that states the reasoning for denying their application. The tenant rejection letter must state if your decision was based on their credit report to abide by the Fair Credit Reporting Act.
Request Credit Checks With Avail
Requiring credit checks from prospective tenants can help you better understand their financial habits that can impact how they handle rent each month. You can also learn more about their payment history, credit usage, and much more.
Request a TransUnion credit report and other tenant screening reports from multiple tenants with Avail. Get comprehensive insights on each applicant directly through your dashboard to help you find your next tenant.
Create an account to run a credit check on tenants, require online rental applications, collect rent payments online, and more — for free.
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]]>The post How to Avoid Fake Pay Stubs and Employment Verification appeared first on Avail.
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When verifying a prospective applicant’s employment history, you’ll most likely receive pay stubs and other documentation to confirm the information they provide. Ideally, applicants will provide accurate information on their income and employer, but this may not always be the case due to how easy it can be to create fake pay stubs online.
For that reason, it’s important to know how to avoid fake pay stubs and other fake financial documents during the tenant screening process. Keep reading to see how other landlords handle employment verification and tips to keep in mind.
What Does a Check Stub Look Like?
Check stubs include a person’s name and address, their job title, gross earnings for a set pay period, total deductions, taxes, a pay summary, and information about their employer. The overall structure of a check stub varies depending on the company, but they should all share the same details. If you receive a pay stub that is missing key information, such as the employer or the person’s job title, then you may need to do additional research to confirm the information is accurate.
How to Spot a Fake Pay Stub
Pay stubs take a few minutes to create online, making it easier for applicants to create a falsified version. Having a process in place to spot fake pay stubs can make it easier to identify them before moving on to next steps.
Here are three ways to verify an applicant’s income and employment information as a landlord.
1. Confirm the Applicant Currently Works at the Company
There can be instances where an applicant can make up a company or list one they’re not a current employee at. Because of this, it’s advised to first confirm the company exists or request an offer letter with the applicant’s job description, pay rate, and official start date.
If an applicant is self-employed, then you can request invoices sent to clients or tax forms provided by employers they worked with. Self-employed individuals do not receive pay stubs and instead receive 1099 tax forms to get paid for contract work. You can also request invoices sent to clients with information on the project, the company requesting the project, and their pay rate to complete the project.
2. Check the Numbers Total to Their Annual Income
A common mistake in fake pay stubs is adding pay amounts that do not total to the annual income listed on their application. To check if the amounts listed on their application match, you can multiple the gross pay by 12 months for their annual gross income. Gross income does not include taxes or deductions, so it should generally match up.
If the numbers do not match with the number listed on the application, you can reach out to the applicant for information as to why.
3. Request Additional Information from the Company’s Human Resources Team
If you’re still unsure on the validity of an applicant’s employment or income, you can reach out to the current employer to speak with a human resources representative.
When asked about what current landlords do to spot fake documents on the Avail Community Forum, one landlord mentioned contacting an applicant’s employer to release current information on their employment. However, some employers require the applicant’s written authorization to provide details on their employment. This can make the tenant screening process take longer, but can ensure the information on an applicant is accurate.
Pro tip: Some landlords advise looking up an employer’s contact information to confirm an applicant’s employment versus calling the number on a pay stub.
How to Spot a Fake W-2 Tax Form
Unlike a pay stub, W-2 tax forms include information on a person’s total salary and wage information instead of a snapshot of their income. To spot a fake W-2, you can follow a similar process listed above to confirm the information is correct.
- Check for the total income: Confirm the listed amount aligns with the number on their rental application.
- Verify the company exists: Do some research to confirm the company exists and if they’re currently in business.
- Verify applicant’s employee status: See if the person’s name is listed on the company website or if the company’s HR department can verify the details on the applicant.
Screen Prospective Tenants With Avail
Verifying an applicant’s employment history helps find tenants that can afford the rent price and make consistent payments. While it may not be common to receive fake pay stubs, it can happen, so it’s important to have a process in place to catch false information from applicants.
In addition to the steps above, you can also request additional tenant screening reports with the help of platforms like Avail. Screen applicants, request tenant credit and background reports, and access all employment documents from applicants in one place. Create an account to get started today.
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Finding your next tenant requires you to check an applicant’s residential history and connect with their previous landlords to see how they’ve handled renting. But how exactly can you verify an applicant’s rental history as a first-time landlord?
We outline a step-by-step guide on how to handle the rental verification process and share questions you can ask previous landlords to get information you need on your applicants.
What Is a Rental Verification?
Rental verification is when a landlord contacts an applicant’s previous landlord to confirm and verify the rental history they listed on their application. While credit checks and rental background checks provide insights on a tenant’s financial habits and criminal history, rental verifications present landlords with an opportunity to connect with previous landlords to get their experience with the applicant.
Why Does Rental History Verification Matter?
Verifying your tenant’s rental history can help you determine if the information in their rental application is accurate. If any part of their rental history is falsified, then that is something to consider when reviewing their application.
An applicant’s previous landlord is also considered a great resource that can answer important questions regarding their payment history, how they escalated maintenance issues, and the way they treated the landlord and other tenants. With these insights and their tenant screening reports, you can better determine if they’re the right fit for your rental property.
How to Verify a Prospective Tenant’s Rental History
There are two ways to handle the rental verification process — you can either contact a tenant’s landlord references directly or use property management software platforms to automatically do it for you. We outlined how to verify an applicant’s rental history with Avail.
1. Request a Rental Application
Avail requires applicants to provide their residential history with their previous landlord’s contact information to be contacted. Our system then emails the prior landlord a questionnaire that asks them about their experience with the applicant to complete online.
2. Review the Landlord’s Answers to Your Questions
Once the rental application has been completed by the applicant, you’ll be able to see what their previous landlords answered in the questionnaire. You can then determine whether or not the tenant was being honest on their rental application or if you need further clarification on certain answers.
3. Directly Contact the Landlord for More Context
If a previous landlord left a comment in the questionnaire you’d like more information on, you also have the option to reach out to them directly. This can be a great chance to ask them more specific questions on the applicant to ensure you’re well informed on their renting habits before approving or denying their application.
Questions to Ask in a Rental Verification Form
Whether you contact an applicant’s previous landlord yourself or through a tenant screening service, there are certain questions you’ll want answers to. Here are the top questions to ask previous landlords in a rental verification form:
- Can you confirm the applicant rented from you?
- Did the applicant pay rent on time?
- Did the applicant reasonably take care of the rental property?
- Was the unit clean and in good order when the applicant left?
- Was the applicant disruptive to other tenants or neighbors?
- Did the tenant violate any of the terms listed on the lease agreement?
- Did you present lease renewal options to the tenant?
- Would you rent to the tenant again?
By asking these questions, you can be much closer to finding a tenant that has a proven track record of paying rent on time and taking care of the property.
Screen Prospective Tenants With Avail
Conducting a rental verification is essential to ensure an applicant is being honest about their residential history, as well as allow you the chance to reach out to their previous landlords. With Avail, our system automatically streamlines the rental verification process by reaching out to landlords through email to have them complete a short questionnaire.
You can then review their responses through your dashboard, in addition to tenant screening reports like a credit report and background check.
Create an account to easily screen prospective tenants with landlord software designed to make renting easier for landlords and tenants.
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The tenant screening process for those that are not U.S. citizens may seem unclear, but there are ways to navigate this process without violating the Fair Housing Act and local ordinances. Here’s everything you need to know about screening international tenants to ensure they meet your criteria before signing a lease agreement.
What to Know About Renting to International Students and Tenants
The Fair Housing Act prohibits landlords from refusing to rent to an international student or tenant based on their national origin. Not only do you need to consider all the applications you’ve received, but your tenant screening process needs to remain the same for each applicant, regardless of whether an applicant is a U.S. citizen or an international tenant.
Tenants need a social security number (SSN) or individual taxpayer identification number (ITIN) to authorize a credit and background check in most states. But since most international students and tenants don’t have an SSN or ITIN, you may need to require additional documentation to verify their information.
Some states limit how much a landlord can screen a tenant, regardless of their national origin, so you’ll want to check your local landlord-tenant laws before beginning the screening process.
How to Screen Tenants Without a Social Security Number
To avoid unnecessary fees for a credit or background check, it’s advised to first confirm whether or not a prospective tenant can authorize them with a SSN or ITIN. If you discover that the tenant does not have a social security number, then you may want to instead consider alternatives to verifying their information. Here are a few steps you can take to ensure international tenants can afford your rent and take care of your property:
- Credit reference: A credit reference on a rental application provides information on a financial relationship the tenant had with a person or business that can speak to their trustworthiness and ability to make on-time payments. Examples of this are asset documentation, character references, or financier support.
- Landlord reference: If the international applicant has previously rented an apartment, then you may be able to connect with their prior landlords. Avail landlord reference checks automatically reach out to landlords once the applicant has provided their contact information, but you can also reach out to them directly.
- Monthly bill statement: An applicant’s phone bill or utility bill statement can be a good indicator of their ability to make on-time payments.
- Bank account statement: A bank statement can provide insights as to how they’re currently paying for their monthly expenses. This can be with stipends, allowances, or grant money.
- Pay stubs: Tenants currently employed in the U.S. should be able to provide two of their most recent pay stubs to verify their income.
When tenants complete an Avail rental application, they can add any additional screening documents for you to reference through your dashboard.
When to Accept or Deny an International Tenant
All tenants you’re considering should meet your tenant screening criteria in order to qualify for your rental property. Tenants usually need to meet the income requirements, provide documents that illustrate their ability to make on-time payments, and leave a good impression during the property showing. When that’s not the case, then it may be best to proceed with caution before approving or denying their application.
If you’re planning on denying an international tenant’s application, you’ll need to provide a justifiable reason that does not violate Fair Housing laws or local ordinances.
Landlords cannot reject a tenant’s application based on their familial status, sex and gender, disability, religion, color, race, and national origin.
Create Custom Applications With Avail
Screening international students and tenants can seem daunting, but there are ways to do this that don’t violate Fair Housing laws. You can require additional documentation to prove the information they provided is correct, or create a custom Avail rental application. With Avail, you’re able to add five custom questions to our standard application template to help you get all the information you need about an applicant.
Create an account today to make the tenant screening process easier and more streamlined.
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While a rental application is a great way to learn more about a tenant’s rental history, a credit report shares information on how they’ve handled their finances — which can serve as a great indication on how they’ll handle rent payments.
In this article, we walk you through the process of checking a tenant’s credit for renting and considerations to keep in mind.
Where to Get a Tenant’s Credit Report
The most common ways of getting a tenant’s credit report are directly through one of the three major credit reporting bureaus (Equifax, Experian, and TransUnion) or through a property management software platform like Avail.
The benefit of requesting a credit report through Avail is being able to bundle it with a rental application to keep everything in one place. Instead of having to sort through different sites, you’re able to screen tenants in one platform, compare applicants with one another, and notify them on the status of their rental application.
What to Look for in a Tenant’s Credit Report
As a landlord, you’ll want to see how a prospective applicant has historically handled their credit accounts. Do they currently have significant unpaid debts? Do they have a strong history of making on-time payments? These are the types of questions you’ll want to consider when reviewing a tenant’s credit report.
With Avail, you can easily access an applicant’s TransUnion credit report showing their credit score, credit usage, account summaries with any past due amounts, and the payment history for open tradelines.
When to Request a Credit Check from Tenants
Most landlords prefer to request a credit check after completing a rental property showing with a prospective tenant for a few reasons. It’s important to prescreen all of your leads to ensure your property is what they’re looking for and they’re aware of your rules as a landlord. You also want to confirm they’re comfortable authorizing a credit and rental background check, since it will require them to share their social security number or an individual taxpayer identification number.
While you do have the option to request a credit check prior to a rental showing, it’s advised to wait until they’ve seen the property in-person to ensure only tenants serious about renting your property submit an application.
How to Collect Credit Check Fees
Credit check costs can vary depending on location, but either you or the prospective tenant can cover the cost. If you decide that the tenant will cover the cost, you can collect the credit check fee directly through Avail, as well as other rent payments and security deposit fees. To collect credit check fees with Avail, follow these steps:
- Log in to your account: Set up your rental properties to screen applicants on Avail. Once that’s complete, navigate to the unit your applicant is interested in.
- Click “Applications”: Click on “Edit” to go to the application’s default settings and tailor your rental application to include personalized questions and require a credit check.
- Add a credit check: You can add a credit report alone or get a bundle of all three screening reports (credit check, background check, and eviction check). However, you’ll want to check local landlord-tenant laws to avoid violating screening laws in your area.
- Access the results through your dashboard: The applicant will need to authorize the credit check and cover the fee to complete their application. The final results will then be uploaded to your dashboard for review.
Can a Landlord Do a Credit Check Without a Social Security Number?
If you discover that an applicant doesn’t have a social security number or an individual taxpayer identification number, then you may need to explore other tenant screening methods. You can request a credit reference or connect with their previous landlords for insights on their rental history and money management.
It’s important to note that landlords are unable to check a tenant’s credit history without a social security number, since there is no way to pull information from any of the credit bureaus. That’s why you should inquire early on as to whether or not an applicant is able to authorize a credit check before having them cover any credit check fees.
Can Tenants Provide a Copy of Their Own Credit Report?
There will be instances where a tenant will want to provide a renter profile or their own credit report to offset the costs of completing several rental applications. Certain states do require landlords to accept a credit report a tenant has provided if they did so within a certain timeframe, so it’s important to refer to your local landlord-tenant laws and Federal Housing laws prior to accepting or denying their credit report.
Request Credit Checks With Avail
Requiring a credit check from applicants is an important step in the tenant screening process. Whether you’re interested in learning more about a tenant’s payment history or credit score, Avail provides accurate and trusted TransUnion credit reports to help you find your next tenant.
Create an account or log in to screen prospective tenants with landlord software designed with landlords and their tenants in mind.
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Landlord reference checks are a great way to learn more about a prospective applicant and the way they’ve previously handled renting. But if you’re new to the tenant screening process, you may be unsure of how to properly reach out to previous landlords and what questions to ask.
In this article, we explain how to run a landlord reference check and share the landlord reference questions you can ask a tenant’s previous landlord.
What Is a Landlord Reference Check?
Similar to an employment reference check, landlords are able to perform a landlord reference check to better understand if an applicant has a good history of paying rent on time and taking care of a rental property.
Although a rental background check provides visibility on a person’s credit score and criminal record, a landlord reference check allows a future landlord to connect with a former landlord to learn more about their experience with the tenant. This could be especially helpful if you’re unable to run a credit check due to a tenant not having a social security number or no credit history.
How to Run a Landlord Reference Check With Avail
Avail allows landlords to streamline the tenant screening process by offering rental applications with automatic landlord references. Here’s how to perform a landlord reference check when screening applicants.
1. Create a Rental Application for the Unit
When creating an account on Avail, you can opt for a free account or upgrade to Unlimited Plus to access waived ACH fees, lease cloning, and custom rental applications.
After successfully setting up all of your rental properties, you can then request an application from any prospective tenant. Click the “Applications” tab to begin customizing the rental application to ensure all the information you want is included.
2. Request 5 Years of Residence History
Avail rental applications can be customized to your liking with Unlimited Plus. Landlords typically request five years of residence history, but this number can be changed depending on your preference.
The prospective tenant will be required to provide the contact information of their previous landlords so our system can send them an email with a landlord reference check questionnaire. The questions they’ll be requested to answer are the following:
- Can you confirm the applicant rented from you?
- Did the applicant pay rent on time?
- Did the applicant reasonably take care of the rental property?
- Was the unit clean and in good order when the applicant left?
- Was the applicant disruptive to other tenants or neighbors?
It’s important to note that the questions on the form cannot be changed, but you can always contact a tenant’s former landlords directly to ask them additional questions.
3. Email the Rental Application to the Prospective Tenant
The final rental application will be emailed to the prospective tenant for them to complete. The email will highlight frequently asked questions they may have to ensure they’re informed on the application process.
It’s advised to provide tenants with a 48-hour timeframe to complete the application before deciding to move on to another applicant. If they still haven’t completed the application within that time frame, then you can move forward with another tenant to avoid delays in filling your property.
Completed applications will populate in your landlord dashboard for you to review and compare all of your applicants. Once you’ve determined whose application you’ll accept or deny, the next step will be to make a lease agreement for your rental.
Landlord Reference Questions to Ask
If you still prefer to contact the applicant’s landlord directly, we shared a few landlord reference questions to consider asking in addition to the ones on the questionnaire.
- Did you offer a lease renewal option? Asking this question can help determine whether or not the landlord wanted to continue renting their property to the tenant. If they expressed not wanting to renew due to previous issues, then this may be something to consider.
- How did the tenant handle maintenance issues? Maintenance issues are bound to happen, so it’s important to know how the tenant handled them in the past. Did they let the landlord know right away or allow them to get worse?
- Were there any major disputes with the tenant? There’s a chance there may have been past disputes with the applicant, but it’s important to hear both sides of the story before making a decision on their application.
Screen Prospective Tenants With Avail
Conducting a landlord reference check doesn’t have to be time consuming. With Avail, you can automatically require references from previous landlords on a rental application. Once they’ve provided their experience with an applicant, you can decide if they’re the right fit for your property.
Create an account or log in to screen prospective tenants with Avail landlord software.
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]]>The post Landlord’s Guide to Renting to Military Tenants appeared first on Avail.
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If you’re a landlord looking for new tenants, you might consider renting to military tenants and families. According to the Department of Defense, 63% of service members live in off-base private housing, giving you the chance to expand your renter search to over 11 million active-duty renters alone.
While there are significant benefits to renting to military tenants and families, there are still some drawbacks you’ll need to be aware of before you sign a lease. Here’s everything you need to know when renting to military families and tenants.
What Are the Pros of Renting to Military Tenants?
There are a lot of benefits to renting to military tenants and families. Here are the top four reasons why landlords rent to service members.
1. They Have a Reliable Income
Military members will most likely be paying or supplementing rent payments with their Basic Allowance for Housing (BAH), a stipend given to them if they are planning on living off-base.
This allowance is automatically added to the service member’s paycheck, so it is a constant and reliable stream of income intended to cover housing costs. The amount they receive will depend on the location they’re based in, the member’s rank, and if they have dependents they are supporting.
If you’re a landlord renting to military tenants, you can easily verify their BAH amount by requesting a Leave and Earning Statement (LES), which is updated for each service member monthly and provides a breakdown of their income (including their housing allowance) and leave status.
2. A Great Option for Rentals in Rural Areas
If your rental is located in a rural area, it can be hard to find reliable and eligible renters to fill your units. Renting to military tenants or renting to military families is a great option in this case because military bases are often located in rural areas across the country.
3. They Are Good Tenants With Connections
Military tenants are often very structured, hardworking, and diligent people because of their training and work ethic – something that can translate into their attitudes as renters.
Renting to military tenants and their families can also lead to your property being recommended to others stationed in your area once they decide to move to another location.
4. Renting Through the Military Housing Rental Program
When renting to military tenants or military families, you’ll come across the Rental Partnership Program (RPP), which is run in part by the Housing Services Center and connects community landlords and housing options with current service members looking for off-base, affordable housing. Participating in this program doesn’t force you to only rent to service members, but it does give you access to a larger tenant pool in your area.
This program has multiple benefits for eligible landlords, such as:
- Being able to market your rental on the RPP properties site viewed by service members looking for housing.
- Knowing that any active duty renter must have permanent orders to remain in the area throughout the decided lease period of the RPP property.
- Having rent paid using allotted military funds for service members seeking off-base housing.
To become an RPP partner, landlords are required to meet the following eligibility requirements:
- You have to have a clean record with the HSC.
- Your property meets all inspection requirements as laid out by the HSC.
- You must be willing to offer a 5-15% discount on the advertised rate, or provide a discount in other ways such as waiving move-in fees, application fees, the security deposit, or agreeing to not conduct a credit check.
- Willing to sign a memorandum of agreement (MOA) that shows you agree to RPP terms and guidelines as a rental partner.
- Know that the RPP doesn’t and can’t guarantee occupancy in the rental, nor will it cover any damages made to the property nor any late or missed rent payments.
What Are the Cons of Renting to Military Tenants?
There are also valid reasons for not renting to military tenants, most importantly being that they might be forced to leave at a moment’s notice for their job. Here are a couple of reasons why renting to military tenants can be challenging.
1. Could Move With Little Notice
At the end of the day, military tenants are bound by the requirements of their jobs, which include having to move with very little notice. Whether they are deployed to another location or have a change in station orders, military renters are legally able to move out early and break their lease without consequence, as stated by the Servicemembers Civil Relief Act (SCRA).
This can be a big drawback for some landlords, especially since you could be left without a tenant in your property. That being said, the RPP tries to remedy this as much as possible by requiring that a service member be permanently stationed at the location of the rental for at least the duration of the lease, and most service members are stationed in a given location for about two to three years.
2. Could Fall Behind on Rent
It’s also not impossible for a military tenant to fall behind on rent, despite having the support of their BAH. When this issue arises, the SCRA provides protections to service members that will keep them from being evicted due to missed payments and allow them to delay rent payments, leaving you without much room for response.
Evicting Military Tenants
Evicting military tenants is extremely difficult due to the protections of the Servicemembers Civil Relief Act. Here’s what the law outlines and when you can (and can’t) evict a service member from your rental.
Servicemembers Civil Relief Act
The Servicemembers Civil Relief Act is a set of laws that protect active-duty service members from having to carry the financial burden of breaking various contracts, leases, or other obligations due to their deployments and having to move for their work.
For landlords, this means that SCRA can prevent a military tenant from being evicted due to missed rent payments, unless said rent is over $4,089.62 a month as of 2021. This number updates on a yearly basis and is important to know if you’re planning on renting to military tenants and families.
In a case where a military tenant is not able to pay their rent because of their work and the amount of rent due does not exceed the above number, a court can prevent said tenant’s eviction for up to three months (or longer if justified). This does not absolve the service member from paying rent, nor does it act as a way for military tenants to avoid paying for their housing altogether.
Military Tenant’s Right to Terminate a Lease
SCRA also allows military tenants to terminate a given lease as long as they a) become active duty during the lease or, b) if they signed a lease while in the military then get a Permanent Change of Station (PCS) order or are deployed for at least 90 days. As long as these conditions are met, a service member only needs to give their landlord written notice of their change in status or orders.
For all standard leases, the termination will be effective “30 days after the first date on which the next rental payment is due.” Know that military tenants are still responsible for all rent payments during the months before the lease termination date. If rent was paid in advance, you will need to prorate and return all payments for months after the new termination date. Security deposits will also have to be returned at this date.
Some landlords will add an SCRA rights waiver to the lease that, if signed, would remove the military tenant’s protections under these laws. Look into your local laws for more information on if and how you can add this waiver to your lease and always advise the prospective military tenant to think about the implications of signing this waiver — as well as recommending that they consult a lawyer for advice.
Use the Customizable Lease feature by Avail to adapt your standard lease for military tenants.
Can a Landlord Refuse to Rent to Military Tenants?
Federally, military status is not a protected class according to the Fair Housing Act, which means you can refuse to rent to military tenants because of fears of losing income due to deployments or a change in PCS orders.
However, there are state and local housing protections that prevent landlords from refusing to rent to prospective tenants because of their military status. Always refer to your local and state laws on this topic before refusing to rent to a service member.
How Do I Rent to Military Tenants or Military Families?
If you’re looking to rent to military tenants or military families, then you might be wondering how you can attract these renters to your property. We’ve outlined a few ways you can make your rental jump out to prospective military tenants.
1. Adapt Your Lease to Make It Military-Tenant Friendly
Because of the nature of military jobs, it always helps to be flexible with the length or type of lease you’re using to accommodate any sudden deployments. It will be greatly appreciated by your military tenants and their families!
2. Adjust Your Rent
Many military renters will be paying for their housing with a BAH stipend, which changes depending on the service member’s rank and location. Adjusting your monthly rent cost to accommodate your area’s average BAH rate will help you attract more military renters.
3. Provide a Military Discount and Other Perks
Marketing a military discount on your rental listing will help attract more people to your rental while making them feel respected and cared for. You can also create other perks especially for military renters, such as waiving application or move-in fees, or making one month free.
Make Renting to Military Tenants Easier With Avail
When you’re ready to start renting to military tenants and families, use Avail to make the process that much easier. Customize your lease agreement to not only fit your state and local laws but also accommodate renters in the military. It makes adding an SCRA waiver, adapting payment terms, and adjusting the length of your lease that much easier.
You can also adapt the way you market your rental through Avail. Simply add in a few disclaimers about the perks you provide to service members, if you’re a partner with the RPP, and other attractive features to your rental listing through the “Build Your Rental Listing” feature under each of your properties. Your listing will then be syndicated to top online rental listing sites like Realtor.com®, Doorsteps, Apartment List, and more. Create an account or log in today to get started.
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While needing to rent an apartment sight-unseen isn’t ideal, it also isn’t uncommon. Tenants moving across the country for love, school or work often have limited time to find a new home and their moving budget may not include funds for apartment hunting trips. But for landlords, renting an apartment to a tenant sight-unseen may feel like a risky proposition.
The best way to screen sight-unseen tenants is to be consistent and thorough. Following these six guidelines for screening tenants sight-unseen will help you cover all bases so you can make the best decision about a tenant you haven’t met in person.
1. Know the Risks of Renting to a Tenant Sight-Unseen
While many people have legitimate reasons for wanting to move quickly, urgency, sob stories, and offers to pay above the asking amount are all red flags that need to be investigated.
Sure, a tenant could offer to pay extra to shorten the process and secure the unit, but it may also be a scam that relies on your willingness to pocket the bigger payment to get their foot in the door, after which the rent checks stop coming.
Pump the brakes on anyone who tries to get you to shortcut the review process. For one thing, you need to be able to thoroughly vet their applications materials, but you also need to ensure they know what they’re getting for the rental money. Even if they’re willing to rent without a tour, you’re better off insisting on at least a virtual walkthrough to avoid a situation where your new tenant arrives with inaccurate expectations and accuses you of false advertising.
2. Start With a Pre-Screen
Good tenant screening starts with a pre-screening process. Ideally your tenant requirements should be included on the listing to help people pre-qualify themselves before even reaching out, but it’s a good idea to use the first contact to ask these questions yourself.
Especially if you’re dealing with a tenant who is unable to meet in person prior to the move-in date, it’s wise to have an initial phone conversation to ask them the basics, such as their reason for moving, their timeline, the number of people who will be sharing the unit, and whether they have pets or smoke.
3. Don’t Skip the Showing
If that initial conversation goes well, it’s time to move onto a showing. For remote applicants, share photos of the unit and all shared spaces, including laundry areas, exterior entrances, staircases or elevators, parking, mail rooms and amenities. If the tenant is happy with the photos, set up a time to do a video walkthrough of the space and pay attention to the questions they do — or don’t — ask.
It may seem redundant to share photos and do a video walkthrough, but pictures don’t always accurately represent the current state of a unit. Plus, the video meeting offers another opportunity to feel out an applicant and confirm that they are who they say and have a sincere interest in your unit. If a prospective tenant is earnestly interested in finding a home where they’ll be happy (but can’t visit in person), the offer to do a video walkthrough should be a welcome one.
4. Be Thorough With Background Checks
Prospective tenants may misrepresent their income, their employment, their eviction history or even their identity to get into a unit. It’s your job to cut off potential scams by taking the time to verify all of the information provided to you through your own applicant screening process.
Screenings for every eligible applicant should include criminal background and credit checks, employment and income verification, and calls to their references and past landlords.
Never take a tenant’s word in lieu of paperwork and never accept paperwork without independently verifying it. A market exists for fraudulent pay stubs or employment contacts, but if you do a full credit and background check and call all references, you’ll be better protected against scams.
5. Consider Customizing the Rental Lease
Using a consistent and thorough screening process is a good way to prevent scams, save time, and ensure that you don’t ask any questions that could be construed as discriminatory. But once screening is complete, you can make some customizations with your lease. Your typical renting term might be 12 months, but for someone moving to your area from out of state, you could offer the option to do a 6-month lease instead.
The shorter option gives you both the opportunity to reassess the situation sooner and to ensure it’s working for both parties. Just be aware that if you have multiple units, shifting the rental season for one could have an impact on the time you spend advertising and showing rentals, since it may no longer align across all of your properties.
6. Making the Call
Renting to a tenant sight-unseen is a unique situation, but ultimately it’s best managed by using the same process you use for every other applicant. The main thing to remember is to never skip steps or make exceptions that shortchange your vetting process. Communication is key and you can always reserve the right to deny an application for legally appropriate reasons.
Just remember: Good landlord-tenant relationships start with reliable information, so the first step is to get a strong screening and application process in place.
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One of the most important questions a landlord can ask renters is how much money they make to determine if they can afford the rent. In addition to checking their credit scores and rental backgrounds, verifying income is a crucial part of the screening process that can help landlords find a renter who will be able to pay rent on time.
However, renters can have various income sources that require different documentation types. For that reason, we outlined how renters can provide proof of income when applying for a rental property.
10 Proof of Income Examples Landlords Can Request
Here are 10 proof of income examples landlords can request from prospective renters during the tenant screening process.
1. Pay Stubs
Renters with a full-time or part-time job generally receive this document from their employer. Landlords should ask for a renter’s two most recent pay stubs to determine whether the renter’s income fluctuates monthly, how often they are paid, and what their gross and net salary is.
Pay stubs also include a renter’s official title at their company, which can help landlords verify if the information on their application is accurate or a fake pay stub.
2. W-2
In addition to a pay stub, landlords can also request an applicant’s W-2 form, which will show their declared income from last year and whether or not they had consistent income over the previous year.
3. Tax Returns
Tax returns are the best indicator of a renter’s current income, but they can show unearned income and overall income history. Renters can submit their recent tax returns, but the 1040 form, which contains all of one’s income sources, will likely be the most useful document within their tax returns, according to TurboTax.
4. 1099 Form
If you’re renting to self-employed individuals, they won’t have a W-2 because they don’t have a traditional employer. A landlord’s next best bet is asking self-employed renters to submit their 1099 forms for proof of income, which proves wages and taxes for a self-employed individual.
5. Bank Statements
Requesting bank statements is particularly useful for self-employed renters because they won’t receive regular pay stubs like they would from a traditional employer. Ask for pay stubs dating back to the previous two to three months.
6. Letters from an Employer
Once the applicant provides employment references, landlords can reach out to their employer to verify that their salary and other information is accurate.
If a renter submits a false reference or their salary information is incorrect, that could be a warning sign.
7. Social Security Benefits Statement
It may be hard to believe, but seniors are increasingly becoming renters. In fact, a Rentcafe.com review of U.S. Census data revealed that households of renters over 60 years old have gone up by 43%. Retired renters or their loved ones can download and submit a copy of their Social Security proof of income letter as income verification.
8. Pension Distribution Statements
According to TurboTax, recipients of retirement benefits such as pensions, annuities, or other retirement plans will receive a 1099-R form. Retired renters can send in this form from their most recently available tax returns.
9. Workers Compensation Letter
If a renter was hurt in a workplace accident, they are likely receiving workers compensation. Renters can obtain copies of this letter from the insurance company or the court in charge of their case.
10. Court-Ordered Award Letters
Are you renting to a divorceé or a single parent? They may be receiving compensation from a former spouse or partner. If a renter has received compensation from an agreement such as alimony or child support, renters can obtain a copy of these agreements from the court.
What to Do If Renters Cannot Provide Proof of Income
There may be instances where prospective renters can’t provide proof of income, such as newly graduated college students. In those instances, you can require them to get a lease guarantor or co-signer if you believe they’ll be a great tenant, even if they don’t meet your income requirement. They will also need to complete the screening process to ensure they meet your criteria and have their name on the lease agreement.
If you instead choose to deny their application, you can provide them with a rejection letter that states your reason for declining their application.
How to Spot Fake Proofs of Income
Ideally, applicants would submit accurate proof of income, but that may not always be the case. If you feel like a form is falsified, check for the following details:
- Confirm the applicant works at the company or has been contracted to work by them
- Check the numbers total on pay stubs to their annual income on their application
- Request additional information from their employer to confirm documentation is correct
- Do online research to verify if their employment information is correct
Make Renting Easier With Avail
It’s relatively standard practice for landlords to verify a renter’s income to ensure they can pay their monthly rent. Collecting a prospective renter’s proof of income can take time, but leveraging a tenant screening service like Avail can help you streamline the screening process and collect proof of income for various applicants.
For renters, you can create an Avail Renter Profile to add proof of income documentation to share with multiple landlords. Whether you’re a landlord looking to screen multiple applicants at once or a renter looking to make the apartment search easier, Avail has solutions that can make renting easier.
Create an account today to get started.
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Investing in green upgrades to make your rental property more energy-efficient can save you money and help you attract tenants willing to pay more to live in an environmentally friendly space.
According to a 2017 survey by the National Multifamily Housing Council (NMHC) and Kingsley Associates, nearly two-thirds of renters said they were “interested” or “very interested” in living in buildings that have earned energy efficiency certifications or recognition for sustainable design. What’s more, they’re willing to pay up to an additional $27.21 in monthly rent for units in such buildings.
However, making all the upgrades necessary for energy efficiency certifications can be costly. For LEED certification of a multifamily home, registration alone costs $1,200.
Luckily, you can still realize savings with smaller upgrades. By alerting existing and prospective tenants to these new features, you can further your property’s appeal.
Here are five eco-friendly updates to help get you started.
1. Swap out overhead light fixtures for ceiling fan/light combos.
Adding a ceiling fan is a great way to help regulate the temperature of your rental units without overtaxing the HVAC system. Opting for an Energy Star certified ceiling fan with lights is best, with Energy Star fans being 60% more efficient and with the potential to save you up to $165 over the 10-year life of the fixture.
Most fans can be adjusted to create an updraft in winter to move the warm air downward into the room and a downdraft in summer, to better circulate the cool air. According to Energy Star research, using your ceiling fan and dialing up the thermostat by just two degrees during the summer months can lower air conditioning costs by up to 14% over the season. Adding energy-efficient light bulbs to the fixture can also lower costs and require less frequent bulb replacement, as they last 10-25 times longer than conventional bulbs.
2. Schedule annual pre-season tune-ups of your HVAC system with a professional.
Heating and cooling cost the average homeowner $875 a year, according to Energy Star. Repairs to air conditioning units cost on average $348, and for furnaces, the average cost of repair is $288.
To limit repairs and ensure your fixtures function for their full 15-25 year lifespan, rather than ending up in a landfill prematurely, schedule annual pre-season tune ups. A one-hour visit by an HVAC professional in spring for the air conditioner and fall for the furnace typically costs $70-100 — far cheaper than repairs or replacement.
3. Spruce up your landscaping with native plants.
Research has found that up to 30% of water consumption in urban areas on the East Coast, and up to 60% on the West Coast, is used for lawn irrigation. Planting grasses and flowers native to the region, however, can drastically improve the soil’s ability to retain water, thus cutting back on water use and the time and expenses required to keep up your curb appeal.
Native plants require fewer pesticides and fertilizers, and they provide an ecosystem for butterflies, bees, and birds that closely shorn grass lawns do not. The EPA even offers a list of the best options for native planting by state to get you started.
4. Add a microwave.
You may not have microwaves in your rental units, but if you’re finding you have high bills for air conditioning or cooking gas, installing some could help. A new microwave with basic features costs roughly $75, but can reduce cooking energy by as much as 80% for small portions. Likewise, since microwaves more effectively target heat than ovens or ranges, their cooking times are shorter and they’re less likely to heat up the room and trigger the air conditioner in summer months.
5. When prioritizing appliance upgrades, fridges and washing machines yield the best returns.
Appliances make up 9% of energy costs in American homes. To realize savings through upgrades, Consumer Reports suggests focusing on the fridge or washing machine first. According to the site, an Energy Star-certified refrigerator uses 50% less energy than a fridge from 2001. If your washing machine is more than 10 years old, it’s costing you an extra $180 annually compared to a newer, more efficient model.
Thinking long-term
Eco-friendly changes can have a positive impact on your wallet and your tenants, but they’re also a long-term investment in the value of your property. According to The Boston Globe, for every dollar you’re able to lower your energy bills, you get back between $15 and $20 in resale value.
Just remember: Making your rental property more eco-friendly can be a gradual process. Increase your investments strategically over time and you have the potential to improve your building’s occupancy rate, command higher rental prices, and improve the overall value of your property.
And as you make upgrades to your property, make sure you’re adjusting rent accordingly and highlighting the upgrades in your rental listing to attract great tenants.
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