How Is Rental History Verified?

The last thing you want as a landlord is a troublesome renter occupying your rental property since having a bad renter may result in the non-payment or delay of rent, costly evictions, and property damage. Getting a reliable and upstanding renter ought to be your highest priority. Renter screening, therefore, is an essential part of the renting process.

What is renter screening?

Renter screening is a process used by landlords and property managers to assess prospective renters. Everyone wants to choose the right tenant, and verifying rental history is a crucial component to doing that. The primary purpose of renter screening is to determine the likelihood that your prospective renter will fulfill the terms of the rental agreement or lease and take great care of your rental property. At the end of the process, you might approve of the applicant’s tenancy, approve tenancy conditionally or deny residency completely.

During renter screening, you should consider the following critical pieces of information about your prospective renter:

1. Credit history: You obviously want to lease your property to someone who’s likely to pay rent on time. A renter’s credit score indicates if they’re likely to pay rent on time.
2. Income: A primary concern as you rent out your property is the non-payment of rent. If the renter makes insufficient income (less than three times the rent), they probably aren’t a good fit for your rental property as they might not be able to pay rent on time or at all
3. Criminal background: Most landlords refuse to rent to prospective renters who have a criminal record, regardless of the degree of the crime and the circumstances of the crime, to avoid putting their rental property and neighborhoods at risk. 
4. Eviction history: A renter’s eviction history says a lot about a renter’s character and their relationship with their previous landlord.

While these are crucial parts of the renter screening process, another critical element is a prospect’s rental history. 

What is a rental history report?

A rental history report is a detailed account of who the applicant is as a renter. The report includes a list of previous properties they rented, the contact information of their property managers or landlords at each rental, how long they rented each property, how much rent they paid at each property, and any reported incidents during their rental period. 

A renter’s past rental behavior can be a representation of their future behavior. Not only does the renter’s rental history give you a bigger picture of who they are, but it also helps you to make a final rental decision. No matter how trustworthy and responsible your new renter might seem, you must verify that the information they have provided you with is accurate. 

What if the applicant doesn’t have a rental history?

You are likely to receive a prospective renter that has no rental history. This is particularly common in people new to the rental market, like millennials, college students, or generation Z renters. A lack of rental history or a substantial rental history shouldn’t necessarily qualify someone as a bad renter.

If you find yourself in such a situation, you can consider several other critical pieces of information instead of looking at rental history. Examples include co-signed leases, pay stubs, or tax returns.

What is rental history verification?

Rental history verification helps you to verify the rental history of your prospective renter. Verification is carried out through a background check and a phone call verification. Although a background check can provide rental history information, it’s a good idea to cross-check it by calling a prospect’s previous landlords.

Steps in Rental History Verification

To verify your prospective renter’s rental history, follow the following steps:

1. Have the Renter Applicant Sign a Rental Verification Form

A rental verification form is a consent form that your renter will sign to permit you to perform a background check. This allows you to call their previous and current landlords and their current employers. You should include a rental verification form with your initial listing to weed out the applicants who may not want to release their rental history. 

2. Review Your Prospective Renter’s Rental Application for Gaps

Are there gaps in your prospective renter’s rental history report? Are there significant breaks in tenancy? Has the renter left out previous rental addresses or the landlord’s contact information? Ask the renter about the gaps in their report. Are there acceptable reasons for these gaps?

Look out for missing information in the rental history report. Significant omissions could signal that your renter applicant either doesn’t want to share their tenancy history or doesn’t want you to contact their previous or current landlords. This is a red flag.

3. Conduct a Landlord Rental Verification

Once you’ve verified the application, it is now time to call the landlords. Properly executing a landlord rental verification will give you the best perception of what type of renter your applicant will be. Previous and current landlords will help you establish if the renter will keep your rental property in good condition, pay rent on time, or if they’ll cause trouble with the neighbors.

 A 10-minute phone call conversation with the applicant’s landlords can give you an idea of whether the renter is responsible and reliable. Before calling, ensure that the prospective renter gives you the landlord’s name/ the property management company, their phone number (preferably for faster and convenient communication) or email address, and their address. 

Is rental verification necessary?

This answer will vary from one landlord to the next. Some landlords claim that rental history verification will not accurately represent the renters because some landlords may give false information. However, some provide accurate information about the renter and save you the trouble and headache that may come with renting out your property to a particular renter.

Picking an ideal renter all comes down to deciding if the renter applicant is the right fit for your rental property. Having the correct information will, however, make this process easier for you.