The Importance of the Landlord Screening Component of the Screening Process



Hello, I’m Cody Reeder with Reeder Asset Management. We are a full- service property management company, serving Cache Valley to Utah County. Today I would like to talk about the screening process. In particular the landlord screening component of the screening process.

A lot of times when I talk with owners, they will tell me that they do screening and that is great. But, as I dig a little deeper overwhelming the majority just do a credit check. Sometimes they may call to make sure that they do work in the place they claim to work.  As I talk with owners I realize they are missing a very important component, and that is the landlord referral.  Part of our screening is the credit check, we check the sex offender list, we do a criminal background check, employment verification, we do previous landlord, we are a part of rent bureau, it’s kind of how property management companies talk to each other.  As I said, each one warrants their own discussion. But today I want to dive into the previous landlord because it is so important. In my opinion, it’s the most important. For example, we’ve had just recently a prospective tenant that we screened have a 780 credit score but had one tradeline. And the trade line had been opened for about 6 months. He was a young kid trying to build his credit. At first glance that looks really attractive, but as you look a little at the tradelines you realize they haven’t established themselves as a creditworthy tenant. That is why I want to dive in a little bit deeper and you should be diving in deeper than just the credit check. 

If they give you a current landlord, we at Reeder Asset Management don’t give the current landlord a lot of weight. Now if it is someone we’ve worked with before or it’s a local property management company that we trust, that is a little bit different. If it’s a large company that is based out of Salt Lake, they don’t know the tenant per-say they’re just kind of diving in and giving you information from their software.. But when you are calling another owner, it very well may be that that owner is tired of the tenant. And wants them out but doesn’t want to go through the eviction process. Or the tenant dragging their feet claiming that there is just nowhere to go. So, they are actually going to give that tenant a good referral. When in fact it could be a bad tenant. So, in your search and your inquiries, you just want to make sure you’re not giving a whole lot of credence to the current landlord, but the previous landlord. While I’m on the previous landlord, you need to watch out for fakes. This is what makes your job as the owner if you’re screening the tenants so much more important than even us is because most of those tenants that we call “lemon tenants” they just aren’t going to apply with us because they know that we are going to do a full screening. They know we are going to do these exhausted checks to make sure that we are getting an ideal tenant. Whereas an owner will just cut corners And, in your searches make sure they haven’t given you a fake landlord. Some of the ways you can do this is, when you call that previous landlord, don’t ask “yes or no” questions. Ask a question that will elicit an actual response. So rather than saying was their rent $800 a month? You would say, how much was their rent? It forces them to match what they said to what the tenant put down on their application. Instead of saying, did they live here from October 2016 to September of 2017, you would actually say, what dates did they rent from you. So, you are eliciting specific responses. The other thing is, you can just strike up a conversation. A casual conversation. Ask questions that don’t even feel like it’s part of the inquiry. Ask them how many units they have, what experiences have they had as landlords. Just strike up a friendly conversation. You will be able to discern whether they are a good landlord or not. After all of that, if you are still a little bit concerned you can actually contact a local title company and have them do a property profile search that will actually show the name of the person that owns that. Now if it’s under an LLC, that is a different story.  That could be a bit more difficult. But again, you’re just looking for as many ways as possible to verify that previous landlord.

Another thing is that once you find that legitimate previous landlord, and you’ve gone through the questionnaire, what you may find that asking the landlord if that tenant was good, that may be very relative because we have come across some owners that actually enjoyed the fact that the tenant paid late every month because they got that late fee. As a landlord, you just don’t want that. Yeah, it may give you a little extra income. But I have yet to see a time when the tenant is consistently paying late that doesn’t leave the owner hanging on that very last month. You will always end up on the losing side of that, and we just don’t want that as owners. We want to be paid promptly and consistently each month. So, you need to take with a grain of salt when a previous landlord say’s “oh they were great”, because they may be enjoying that late fee. Or they may be enjoying the fact that they never saw heard from that tenant. And again, as a conscientious owner and landlord, you want to know if there is leaking and a lot of times tenants just won’t bother to call. And so, some landlords see that as a very good thing. But as an owner, you should be very conscientious of that. Just know that you still have to go through all the questions. A simple question like, “would you rent to this tenant”, again does not tell you a whole lot. You need specifics. We hope this will help in your search for good tenants! 

Reeder Asset Management


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