There are many landlord responsibilities that you need to worry about before you get the tenant in the property and then once you have a tenant living in your rental property. This is the part where you’re still screening applicants to see who’s going to get the keys to your property.
When it comes to landlord services you need to focus on conducting a credit check before you get anyone into the rental property.
What’s the point of a credit check for a landlord? Why does a credit score even matter at this stage of the game?
You want a reliable tenant.
Once again, a rental property is a huge investment. You’ve poured in a serious amount of your savings into this property. You want to give the keys to someone that’s going to take care of the place and pay their rent on time. A credit score shows how reliable the person has been with meeting their financial obligations in the past. You want someone in your unit that has a history of being reliable, especially with their finances. You don’t want to give the keys to your property to someone that has built up a past of not paying back money that they borrowed. You want the most reliably person possible in your rental property.
A credit score is a tangible number.
Regardless of if you like it or not, a credit score is a quick way to gauge where someone stands financially. You can argue the accuracy of a credit score and complain about it. The harsh reality is that the three digit number is very important. When screening applicants you can easily hit a deadlock. Meaning that a few candidates have excellent jobs, savings, and references. You’re going to need some sort of a tie breaker. This is where a credit check comes into play. The credit score will show you roughly the financial situation that the person has created over the past few years.
Now it’s time to contradict myself a bit. I’ll always be the first one to spread the good word of a high credit score. On the flip side, I’m well aware of the fact that some people don’t have the best credit for one reason or another.
Is a credit check the most important thing?
The truth is that the credit score should be a deciding factor when it comes to deciding between two applicants with similar credentials. Other then that scenario, I don’t want to use an average credit score against someone that chose not to get a credit card, and thus couldn’t build their credit up. Many ambitious 20-somethings haven’t had the chance to build their credit yet. Some young people don’t want to get a credit card for personal reasons. Other 20-somethings were simply too busy in college and working on moving up the ranks to worry about building credit. You can’t use that against these people.
Before we part ways for this section, let’s answer the question in one word.
What’s the point of a a landlord running a credit check on possible tenants? Reliability.
That’s all that needs to be said about screening tenants for your rental property. We’re going to move forward with the idea of having the ideal tenant chosen.
Check out the rest of the Landlord’s Starters Kit:
Do You Want to be a Landlord? Let’s Look at Every Cost Involved
Is Buying a Rental Property Passive Income?
How Do You Become a Landlord?
Should You Hire a Property Management Company?
How to Find a Tenant For Your Rental Property