Compared to attracting new renters, it is far wiser to look for ways to retain long-term tenants. It limits the interruption of the monthly income and saves you time. With a steady income, you can budget for property renovations that will add value to your investment and increase the reason for tenants to stay for longer.
However, following the best practice of running a renewal screening check is needed. This strategy provides you time to evaluate a resident’s stay and helps you continue with the best tenants.
As a landlord, running a renewal screening is a great advantage but can also lead to some renters reacting since going through another round of screening can require time and effort. In this guide, Blue Door Realty will inform you about the necessary steps and factors to consider when conducting a renewal screening check.
Why Renewal Screenings Are Beneficial
A lot of property owners find conducting a renewal screening cumbersome, especially if the renter has shown an excellent history of prompt rental payments each month and properly took care of the unit. While this is understandable since all parties will want to renew the lease right away, you might limit your access to new information.
A similar case would be accepting a candidate simply for being referred by a friend. You would still want to run a tenant screening check despite knowing the person who gave you the reference well. This is naturally part of excellent property management and is deemed one of the best practices.
Throughout the tenancy, there may be several changes that happen to the renter you’re unaware of. The renewal screening check helps you assess whether the renter still meets your criteria. For example, the renter may be between jobs so it can be a challenge to them to meet the monthly rent payment if you decide to increase the rental rate.
The advantages brought by renewal screening checks are:
- Bring Cost Savings – Since the renewal screening check makes you aware of the challenges that beset your renters, you can also steer away from potential disputes that can lead to stressful court battles and evictions.
- Catch Up on The Well-Being of Residents – The renewal screening check helps you manage the well-being of the tenants and allows adjustments to be made to reflect your sincerity in providing a habitable space to make the renters happy.
- Gain Peace of Mind – In contrast to the initial round of tenant screening, renewal screening checks can be less tedious, as long as you have a solid process to follow to renew the leases right away.
Things to Consider During Renewal Screenings
Similar factors to the initial tenant screening will still be assessed during a renewal screening check, but the effort required is considerably less compared to the first round of tenant evaluation.
Here are critical factors for you to review when performing a renewal screening check:
- Credit Report: Reviewing a renter’s credit score is important as this can change a lot of times depending on the situation. If a tenant pays the rent promptly then their credit score can be positively impacted, informing you that the renter has healthy finances.
- Income Verification: Ask the renter to submit a W-2 statement since it’s a quick way to verify their income. A renter may have transferred to other jobs affecting their pay, so it’s important to cross-check the current income before renewing a renter’s lease.
- Court History/ Criminal Background Check – it pays to leave no stone unturned and check for criminal reports when doing a renewal screening, even if it appears unlikely. As a landlord, this is one of your primary duties to ensure everyone’s safety.
Also, you should not limit yourself to evaluating a renter based on these factors alone and ask the following questions as well:
- Did the renter pay on time?
- Were there serious complaints against them?
- Did they damage the rental property?
- Did they break rental policies?
Performing a Hassle-Free Renewal Screening Procedure
To manage the expectations of your renters, you must communicate with them and be transparent with the renewal screening check since a new screening may make some renters uncomfortable.
Also, you can include the renewal screening procedure in the lease agreement. This informs them what to expect and guides them on how the process will be done.
Research About FHA Guidelines
Familiarizing yourself with the Fair Housing Act (FHA) helps you run a successful renewal screening check. You will gain insights to avoid discrimination against renters based on race, religion, sex, familial status, disability, color, or national origin.
You must adhere to this law whether you are performing an initial or renewal screening check. Make sure that your screening process complies with the FHA to prevent potential conflicts in the future.
While renewal screenings may be another task for you as a landlord, the rewards are great since you avoid future headaches. It also gives you peace knowing you have updated information on your roster of tenants.
Blue Door Realty can assist in performing renewal screening checks for your rental properties. Our team has plenty of resources and an easy process that makes it hassle-free for all parties.
Additionally, we also provide full support in marketing vacant units, overseeing property maintenance and repair, and delighting renters with outstanding customer service. Contact us today to learn more!