RENT Magazine Q1 '22

A CREDIT REPORT AND BACKGROUND CHECK CAN EXPOSE A BAD TENANT Fortunately, all of these terrible scenarios can be thwarted with a thorough tenant background check. In other words, the most effective way to avoid a bad tenant is to run a comprehensive tenant screening report with a rental credit score. The credit report begins with the applicant’s personal information, including their date of birth, current and previous addresses and the name of their employer, and date of hire. If they have used other names or social security numbers, this is where they will be listed. A credit summary is next. Here is an overview of any hard inquiries that have been made about them, their total credit limit and how much they currently owe along with how many of their accounts have been paid late or been put into collection. The summary is followed by detailed information about any accounts that may have been placed for collection and any bankruptcies. You can see how much the applicant owed, the account type and its current status. Tradelines are credit cards, bank loans, mortgages, student loans and any other accounts that would be paid monthly. Each of these will be listed with the name of the creditor, the date the account was opened, high credit, recent balance, and monthly payment. If there is a past due amount, the report will indicate how long it is/was not paid. The last item on the credit report will be a list of the hard inquiries made by banks, lenders and other financial institutions which will indicate if the applicant has applied for a loan, revolving credit account or credit card. PREVIOUS ADDRESS TENANT HISTORY The Previous Address Tenant History (PATH) report lists all the addresses associated with the applicant, including the county in which those addresses are located. The list is compiled using the potential tenant’s Social Security Number. It should be noted that the addresses may not all be places where the candidate resided but locations which have been linked with their Social Security Number. TELECHECK VERIFICATION TeleCheck assists retailers, financial institutions, and other businesses in reducing fraud and other risks associated with accepting payments and opening accounts. The company’s verification service will report if your applicant has a history of writing bad checks. This data is based on their driver’s license, so ask to see their identification to confirm that they are giving you the correct number and state.


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