In recent times, the rental landscape has seen a surge in evictions, posing challenges for landlords in collecting judgments from previous tenants. According to the Eviction Lab at Princeton University, eviction rates have risen steadily, with over 2.3 million evictions filed in 2023. Below are five useful strategies to reduce rental losses. FEARS OF UNPAID RENT? TOP 5 PROACTIVE STRATEGIES EVERY LANDLORD NEEDS
Strategy #1: Require a Thorough Application and Documentation
Collecting proper documentation and a thorough application first will help you reduce fraud, assess a renter’s financial capability to meet rental obligations, and streamline the process of collecting rent debt. At a minimum, your application should collect name, date of birth,
previous addresses, landlord references, employment information, all income sources, and in states where it’s allowed, a social security number. Check with your legal counsel to best implement a screening policy that complies with your local and federal laws.
Also, consider collecting the following documents from all adults listed on the lease agreement: ✓ Government-issued identification ✓ Proof of income ✓ Recent bank statement ✓ Tax returns
Strategy #2: Check References and Run a Credit and Background Check Next, review the applicant’s credit report, particularly their total debt, payment history, and collections. Ideally you want to ensure their debt will not stand in the way of paying rent and that they have not recently fallen behind on payments. screening provider that can provide these types of records in addition to a credit report.
Lastly, call the applicant’s previous landlords to find out if they failed to make timely rental payments. If your applicant is employed, you can also call their employer’s HR department to verify their status and salary, which can help you further verify the applicant’s ability to pay rent.
Note that nearly all evictions, tax liens, and civil judgments were removed from credit reports in 2017. Make sure you partner with a tenant
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