San Diego’s rental market is fast-moving and competitive, and you may find yourself in a hurry to place the first tenant who shows up with a security deposit. However, it’s important to be strategic about who you’re placing in your property. A good tenant has a great impact on your profitability. A bad tenant does the exact opposite; you’ll find yourself dealing with late rent, property damage, and potentially, eviction.
Good tenant screening is important because it:
- Minimizes the risk of late rent, missing rent, and potential evictions
- Prevents costly turnovers and vacancies
- Protects your property from potential damages
- Ensures a pleasant rental experience for tenants and a profitable rental experience for owners
Take the time to screen your tenants. Here are some of the tips that tell you how we do it at Ann Tasias & Associates. We have a low eviction rate, a high retention rate, and a reputation for finding and placing well-qualified residents who pay rent on time, take care of your property, and follow the terms of the lease agreement.
Understanding California Fair Housing Laws
When you’re screening tenants in San Diego, you need to be in compliance with California’s strict fair housing laws. Everything has to be objective and consistent, and you’ll want to document both your screening process and your standard rental criteria.
Here’s how to set your criteria to ensure you find great residents and stay in compliance with all state, local, and federal laws.
- Establish clear, consistent, and non-discriminatory criteria for screening prospective tenants. This might include:
- Income requirements. Typically, income should be at least three times the monthly rental amount
- Credit score range
- Rental history checks
- No prior evictions
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- Provide your criteria to prospective tenants before they complete an application to live in your property.
- Be transparent in communicating these criteria in your rental listings or during initial inquiries.
Make your criteria as public as possible. Consider including it in your rental listings as well.
The Application Process
Most tenants are expecting to complete an online application these days.
If you don’t have an application online, talk to a San Diego property manager. We can help provide resources such as this, and you can be sure that the application you’re provided is both legally compliant and legally enforceable. There are specific things you can and cannot ask and you want to make sure you’re using a comprehensive application form that asks for all of the information you need in order to make a decision.
You’ll want to collect personal information, such as names and social security numbers. This will be used to verify the identity of the applicant. Ask for employment and income details and make sure there’s documentation to support what an applicant says they earn. This can be a pay stub or a job offer letter or a bank statement or a tax form.
Ask about past rental history. You’ll want to get the names and contact information for at least two current or prior landlords. When your prospective tenant signs your application, you’ll need them to know that their signature grants you permission to check credit, verify income and employment, and talk to rental references.
Treat all applicants equally and follow the same process for everyone to avoid accusations of discrimination.
Conduct Credit and Background Checks
Credit checks will give you an insight into the applicant’s financial responsibility, while background checks can flag past behaviors that may be of concern. Always get the applicant’s written consent before carrying out these checks.
While you may have established a credit score as part of your screening criteria, make sure you’re also collecting a full credit report. That credit report will tell you more about your tenant’s financial behaviors and responsibility with money.
Check for prior evictions. We recommend doing a nationwide eviction check; tenants are more transitory than ever, and you cannot rely simply on local San Diego eviction reports.
Interviews and Interactions
While paper profiles provide data, nothing beats face-to-face interaction. Interviews can help you gauge if the potential tenant will be a good fit for your property. During these interactions, trust your instincts as a property manager but remain objective and fair. It’s a good idea to do some pre-screening when a tenant calls to inquire about a property or schedule a showing. Ask when they’re planning to move, why they’re planning to move, and whether they have pets. You can also make initial inquiries about income and whether there have been any evictions in the past.
Reference Checks
Follow up with the rental references provided, particularly with past landlords. Key questions include:
- Did the tenant pay rent on time? If they did not always pay on time, how many times were they late, and how long did it take them to catch up? Was an eviction notice ever filed?
- Were there any complaints about the tenant? How were they resolved?
- Did the tenant respect the property and maintain it well?
Send an email or make a phone call. It’s not as time-consuming as you think, and it’s always good to know whether a former landlord would rent their home to a former tenant again. Always do a bit of research to ensure you’re talking to the actual landlord or property manager. If a tenant had a bad experience and doesn’t want you talking to their former landlord, they could give you the contact details of a close friend. That’s not going to help with your screening process.
Tenant screening may seem complicated, but with meticulous attention to detail and a structured approach, it can protect your investment and lead to lasting and beneficial tenant relationships.
These are the basics that we cover when we’re screening tenants for the properties we manage. If you’d like to hear more about our technology, our process, and our ability to identify and attract well-qualified renters, please contact us at Ann Tasias & Associates. We’d love to tell you more and to be your San Diego property management resource. We manage investment homes in San Diego County and the I15 corridor including Poway, Rancho Bernardo, Scripps Ranch, Rancho Penasquitos, and Mira Mesa.
