As an investor, have you had a run-in yet with a 'Professional Tenant?' If you have, you'll know instantly what we're talking about in today's article—and why it's so important to work with professional tri-state property management services to detect and avoid them.
If you haven't yet had the pleasure of experiencing these kinds of renters, then it's critical that you know what signs to look out for. What are the hallmarks of a Professional Tenant—also referred to as 'Serial Squatters?' You can typically identify them by:
- Their keen, almost flashy understanding of rental housing law—which they're happy to share with you
- The fact that they seem great on paper—until you actually go to investigate the information on their application
- The rent checks that constantly bounce for months—followed by plenty of excuses as to why
- The string of evictions in their rental history—that they try to hide with a cash payment up front
- The terrible condition they leave your tri-state rental property in—including the floor-to-ceiling garbage piles.
However, many of these characteristics don't emerge to horrify tri-state property owners until after they've already made the mistake of opening their real estate investments up to these renters. That's a mistake you can't afford to make with your rental properties this year!
When you allow these 'renters' into your home, you'll not only potentially lose out on thousands of dollars of rental income in the form of unpaid rent, but you could also be on the hook for thousands more spent on property renovations and cleaning services. For some property investors, this is damage upwards of $60,000 in some cases—and for something as random as housing 25 goats in the living room.
Don't let random amounts of goats happen to you! Consider the following tips to dodge these problem renters before they ever set foot in your rentals.
Fancy legal note: Of course, this article is not an attorney—so while we're sharing some good information, we always recommend working with your attorney or an experienced local team like Rentwell to ensure you stay on the right side of the law. Being on the wrong side can be worse than dealing with a Professional Tenant!
Your Tenant Screening Process Is Your First Line of Defense
Think of your tenant screening process as a suit of armor for your investment properties that deflects all kinds of hazards. However, this can only work effectively when your screening process is professional grade.
While you can't dismiss an applicant based on the Fair Housing Act's protected classes of:
- National Origin
- Familial Status
There are some alternative factors you can investigate when screening your future renters. Keep in mind that these protected classes may have additional protections at the state level, so working with an experienced tri-state property management company can help reduce your liability.
What Details Can You Look at Safely?
That said, there are still details you can explore as an investor to undertake a thorough tenant screening. It's the following factors that usually betray a Professional Tenant—and keep them from invading and destroying your rental property.
- Check all provided references: Here's where a lot of Professional Tenants end up outing themselves as scam artists. More often than not, they provide fake references that follow through when you actually go digging. If their references tell a story that sounds suspiciously similar, they could be coached.
- Pull a credit report: You can set a minimum credit score as a requirement for your rental properties without running into issues. Investigating their credit report can tell you how well your future renters can keep up with their payments.
- Dive deep with a background check: Don't cut corners with this crucial investigation into your future renters—and be sure to stay FCRA compliant. The effort you make here can pay off later when you discover a red flag.
- Check their eviction history: Investigating this point is absolutely crucial! A single eviction on someone's history after 2020 may be the new normal moving forward, but multiple evictions are a sign of systemic issues—and represent a major red flag.
Property Management Protects Your Interests as an Investor
Professional Tenants are less likely to target a tri-state investment property that's under the care of full-service property management. They know the experts are more likely to spot and shut down a rental scam in progress. Plus, here at Rentwell, we are the champions of property inspections. We inspect rental properties more often than the competition—and we screen your rental property like seasoned pros.
Once we've found an excellent renter and placed them in your rental home, we routinely do property checkups to ensure everything is operating as it should—and that your renters are safe and happy in their homes. Even if you don't have a Serial Squatter lurking in your property, this is a great way to preserve your income by noticing any property details that could do with routine maintenance and repairs.
Leave your rental properties in the hands of professional tri-state property management! Ready to get started for free? Download your copy of our Tenant Screening Checklist to get started protecting your investments like a pro!