When a lease expires, it is natural to want to renew your agreement with quality tenants. If a tenant has proven themselves trustworthy, you will want them to continue renting out your unit.
However, we must warn you against rushing to renew the lease agreement. It is always wise to perform a renewal screening check in order to verify your tenant’s information.
In this article, we discuss the importance of implementing additional screening of tenants in order to keep your investment safe.
Benefits for Landlords
As a landlord, it might not make immediate sense to screen current tenants. Why would you need to conduct a renewal screening of a good, quality resident who always pays their rent on time and has never been a bother to you?
A renewal screening check works to your benefit as well as the tenants. It brings both landlord and tenant peace of mind and confirms they are seeing eye to eye.
Some of the benefits of renewal screening checks include:
- Saving on costs. A renewal screening allows you to catch any issues before renewing the lease. This reduces the possibility of potential damage to the property, late rent payments, and eviction as well as other unexpected costs.
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Assured well-being of your residents. By assuring you have a quality tenant in the unit you are making sure your other tenants have comfort and ease in regards to their neighbors.
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Peace of mind. It is only possible to have a worry free rental when you have a high-quality resident on your property. When you do the renewal screening right, you are assured of this as a landlord.
Elements of a Renewal Screening
While it has the same feel as a tenant screening solution, renewal screenings are less intensive. You won’t need as much information as you required during the initial screening. Below are the key elements that you will need to assess for the renewal of the lease agreement:
Credit Report
During the term of the lease agreement, a tenant’s credit score might have deteriorated due to missed interest or loan repayments. Be sure to use renowned and trusted credit agencies to check your tenants credit score and make sure they will continue to be able to pay their rent.
Income Check
Similar to a tenant screening, you should require the renter to share a W-2 statement with you. This shows their financial capability to pay their rent on time and in full.
Oftentimes, when tenants switch jobs they don’t let their landlords know. Performing a renewal screening is a great way to keep your record updated.
Criminal Background
Similar to the credit report, you will be looking into convictions or criminal cases that have sprung up during their time as your tenant. Keep their criminal history in mind, and pass good judgment on whether or not it is safe to continue housing that tenant.
Interview Other Tenants
A soft check involved communicating with other tenants to gather opinions on this renter. While they might have no issues financially or legally, they may create problems for your other tenants.
This is an important element that most landlords forget about when they are doing a review of their tenants. However, it is important to respect the Fair Housing Act when taking other tenants' opinions into account.
Consider Your Tenant
Sometimes, tenants will be against a renewal screening. It is important to explain the benefits of the renewal screening for both parties.
Here are some tips that will help you with your renewal screening:
Disclosure
An ideal landlord tenant relationship is made when the tenant is kept updated. When they are signing the initial lease agreement, ensure that there is a provision for renewal screening checks at the end of the lease.
If they are made aware of the renewal screening before you request it, they won’t feel blindsided. After all, it is in the lease agreement.
Property Management Software
The use of property management software can help with renewal screening. When you work with a reliable property management company like Limestone Country Properties, you can make use of an online resident portal for your tenants.
The software will give reminders to your tenants requesting them to make updates during the course of the lease agreement.
This will make it easier for you to conduct the renewal screening checks since you will have the information that you need.
Comply with Fair Housing Act Guidelines
The provisions of the FHA still apply, even in a renewal screening. Make sure that you apply the same procedure for all your tenants and that the process is without bias and fair. You will need to take care that there is no discrimination in any way.
When in doubt, reach out to an experienced property manager.
Conclusion
You now know the importance and benefits of renewal screening checks. Contact Limestone Country Properties today. We are a full-service property management operating in New Braunfels with years of experience in the local property market.
Get in touch with us to discuss your property issues with our experienced and expert team of property managers.
