If you are a property owner and rent or lease your property, you may have had the experience of choosing a tenant. Sometimes we are strapped for time, or we just don’t think we need to do the extra work involved in properly vetting a prospective tenant. A clear majority of people are honest, hard working folks who are just looking for a nice place to live. Every once in awhile, however, you can have a bad experience with a tenant. It can cause a great deal of stress and can take months to unravel.
So many headaches can be avoided if adequate time is taken to thoroughly screen prospective tenants. The time spent doing a thorough check of the tenant’s financial status and checking references can prevent rental problems down the road.
All too often, property owners make decisions based on gut instinct about a person. Perhaps you really liked them-so much so that you don’t feel the need to look any further. They “seem” responsible, and they drive a decent car and are dressed appropriately. While this is all fine and good, it will not pay the rent. When it comes to choosing a tenant, relying on first impressions can be risky.
We had an experience where we were looking for a tenant for a property. The woman seemed nice enough and assured us that she made $9,000 to $10,000 per month. This amount of monthly income would be more than sufficient to pay the monthly rent. After doing a little research however, a very different picture emerged. Her credit report showed instances of alleged identity theft. When we checked her employment information, we found out that she was a receptionist. It seemed a stretch that a receptionist would be making that kind of monthly income, so we declined her application.
In California, if a tenant fails to pay rent, it can be a difficult process to evict them. At minimum, it can take 6 to 8 weeks to complete the eviction process. If the person is well versed in unlawful detainers and uses delay tactics, it can take up to a year to get them out. For the tenant, they enjoy staying at your property rent free. It may cost them less money to fight the unlawful detainer than it would for them to pay rent.
When looking for a tenant, it is important to gather all the financial documentation you need to make an educated decision. This can include:
- Bank statements
- Balance sheets
- Tax returns
- Pay stubs
- Employment verification
- Credit check
- References
When renting a property, spending time choosing a tenant can save you headaches, time and money. Starting off the business relationship in a clear, business like manner sets the stage for a mutually beneficial relationship in the future.
If you have run into a tenant problem, or have questions regarding property ownership, please give us a call. We can lay out your legal options and create a plan moving forward with your objectives in mind. If you would like to talk, please contact us to schedule a Get Acquainted Call.