Nothing is worse than having to evict a tenant. It is expensive – as much as $7,500 or more, it takes way more time than you likely have, and it is tough on your good tenants. Anything you can do to prevent evictions is worth doing. With that in mind, Spirited has compiled a list of 17 red-flags that indicate someone is potentially a bad tenant.
17 ways to protect yourself from bad tenants
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Currently unemployed
If an applicant cannot list a current income source, you have no assurance that they can cover the cost of rent each month. You should not take the applicant’s word over insufficient evidence of current employment. Unemployment may last for many months, and savings can run out quickly. You do not want to put yourself in a situation of needing to evict a bad tenant for nonpayment.
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Newly self-employed
There are great income opportunities in self-employment, but a short history of self-employment often means that a stable income and employer references are absent. New businesses require time to generate enough revenue to support monthly expenses, so be cautious about accepting a rental application from someone who claims recent self-employment.
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Excessive haggling over rent
Haggling excessively over the cost of rent may be a sign that the bad tenant can’t afford the property. If they aren’t prepared with research and facts as to why the rent should be lower, this may not create a good professional relationship with the person they are renting from.
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Low credit score
Running credit checks on potential applicants can help you evaluate their financial situation. Think of a credit score as a financial report card, helping you determine past financial responsibility. If a potential renter has unpaid bills, late payments, or wage garnishments, these issues would be reflected in their credit score and could indicate they are potentially a bad tenant.
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Cash-only deposits and payments
A renter who wants to pay cash may sound like a dream tenant, but typically a tenant offers cash because they have bad credit. You may not know the person’s actual financial status for several weeks, and by then, it may be too late to avoid significant payment issues.
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Complaints about the current landlord
Behind every renter is at least one landlord horror story, but if your potential tenant complains excessively about past rental experiences, they may ba a bad tenant. Consider what they might say about you when they encounter a policy they do not like or they disagree with a maintenance decision. Your reputation could be in jeopardy by renting to a person who cannot seem to stop complaining.
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Inability to meet face-to-face
Be sure you meet your potential renter face-to-face at least once. Renting to responsible tenants is very important, and if they can’t find the time to meet you in person, they may be unlikely to follow through on their lease agreement or monthly payments.
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Evidence of drug or alcohol use
If a potential tenant arrives for a tour and smells like marijuana or appears drunk, this indicates a lack of respect for the landlord and property. You may want to avoid renting to someone whose judgment is impaired by substance use.
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Frequent relocation
Renters sometimes move when they find more affordable housing or better job opportunities, but you may uncover other reasons for frequent moves. Try to determine if they were asked to leave their previous residence or if neighbors reported excessive noise. If your renter doesn’t have legitimate reasons for relocating frequently, or if they seem to have the same problem with their roommates or landlords over and over, you may not want to enter a rental agreement with them.
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Unstable job history
There are many legitimate reasons a tenant may change jobs frequently. Regardless, someone who switches jobs often may not have a stable source of income or may not be able to pay their rent between employment changes. If you are looking for stable long-term tenants, be sure they have an employment history of at least 12 months with the same job or career.
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No rental history
First-time renters are not always a concern, but be particularly wary of a potential tenant who has rented before but has no proof of prior tenancy. If they paid rent to a friend or family member, ask for proof that their rent was paid on time, as past payment activity often indicates future payment habits. Ask for a guarantor on the lease, thoroughly research their income, and request character references from coworkers, employers, coaches, or mentors.
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Anger over the verification process
The tenant screening and verification process is extremely important for uncovering potential issues. If your applicant becomes angry or argues over the process, they likely have something to hide and may be trying to intimidate you into skipping these important steps.
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Withheld personal information
If a potential renter is reluctant to provide personal information, leaving portions of the rental application blank, they may be hiding essential information. You should follow-up by questioning the applicant about blank portions of the application. If the applicant doesn’t authorize a credit report or background check, you should reject their application. Information needed from a prospective tenant should not be difficult for a lessor to obtain, and if an applicant is withholding information, you would likely find them to be bad tenants.
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Inconsistent personal information
Since an applicant can easily falsify personal information, verify that the information provided matches the tenant screening reports. Any differences should be investigated. Renting to a dishonest tenant may create problems for you in the future.
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Insufficient income
Your tenant must be able to pay rent each month, so be sure to review income and credit reports. If the applicant does not have enough income to support their monthly rent, or if they refuse to disclose their income, you have a valid reason to deny the application. Typically, a tenant’s income needs to be at least three times the cost of their rent.
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Invalid or nonprofessional references
Underestimating the reference screening process can lead to problems later on. Make sure the references provided by applicants are legitimate. While personal references may offer a well-rounded picture of a potential tenant’s lifestyle, valid employment and landlord references are also essential in effectively screening applicants. If the prospective tenant cannot provide references other than relatives or friends, you may experience significant challenges if you allow them to sign a lease.
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Past criminal record
Sometimes, the future is best predicted by observing the past. Be sure you are aware of a tenant’s prior behavior, especially their criminal history. If you skip a tenant background check, you may be liable. If a crime happens in your building, you may be sued for negligence.
We hope these tips help you to protect yourselves from bad tenants and avoid future evictions.
