Hello, Troy.

My name is Leo, and I run a residential apartment building in Lubbock, TX.

I’m sending you this email to show my appreciation for your excellent screening service.

Your reports are very promptly generated, and they contain very accurate data regarding applicants’ backgrounds.

But that’s not the only reason for this email today.

Recently, your report revealed a sexual offender that came to me to apply for an apartment unit, so I was able to deny his qualifications based on that information.

Although I believe everyone has his/her story, a sexual offender is definitely not good for the business and is probably too much of a risk for me and the neighbors to have live in my property.

So, thank you, Troy, for providing this excellent service.

Keep up the excellent work!

Best Regards,

- Leo -

Lubbock, TX

Welcome back!

Rental history verification is an extremely important step in the tenant screening process.  If a person has been a good renter in the past, chances are they will continue this pattern.  The reverse is also true.

Rental history verification is very straight forward.  You want to speak with the past landlord and find out what type of a tenant the applicant has been.

Ask the following questions:

*Length of time rented?

*Did any problems occur while renting?  If yes explain

*How many times were they late paying rent?

*Do they know why person is leaving?

*Do they have pets?

*Are they breaking the lease?

*Would you rent to them again?

 Make sure you do good rental history verification. 

If you do not have the time to do it yourself, Renting Authority can help you. 

Log into the Property Owner’s Toolbox at http://toolbox.rentingauthority.com/login. 

Select background and credit reports. 

Click the boxes for employment and rental verification, fill in the needed information and we take care of the rest.

You will get your verification reports in 24-48hrs. The Cost is only $6 for Employment and $6 for Rental History verification or $4 each for Monthly Members.  If you have any questions, please email or call.

Next week I will give you some tips on how to do rental history verification.

Visit our new site at www.RentingAuthority.com

Answer: probably not.

 Please be aware that I am sensitive to anyone who is going through a foreclosure.  I am giving this advice from the vantage point of a real estate investor.

Foreclosed applicants on average have a 24% lower credit scores.  They also have four times as many 30 or more day delinquents or derogatory.

What that means, is history has a way of repeating itself.  A person is who is foreclosed on, has a poor history of paying obligations on time.  Do you really want to risk your investment to someone like that? Take the chance that they will not pay or pay late?  Evictions are not a fun ordeal.

It’s not only tempting, but some times feels necessary to fill a vacancy quickly.  Never let your feelings of disparity cause you to give up your standards.  Create your standards for tenant screening and stick to them. 

Hint on tenant screening.  Renting Authority provides a free Applicant Rating Report with every credit report.  Use the drop down menu next to the credit score and select the “Applicant Rating Report.”  This report shows you how an applicant compares to other applicants across the country.

Please contact me with any questions regarding this topic.

Thanks,

Troy

888-674-9181

tboldt@rentingauthority.com

www.RentingAuthority.com

You are so excited, someone finally filled out a rental application.  You look at the credit report and the credit is score is between 540 and 580.  Your hopes drop.  They seem like nice people who have had a bit of bad luck and need a second chance.  Well, if that sounds familiar, you need to put on your detective hat, gloves, grab your blue light and start investigating.

Let’s investigate three common factors that affect a person’s credit.  I’ll set the crime scene (credit factors), give some clues and help you draw conclusions.

1.         Crimes Scene: Credit cards
Clues:  If a person does not have any open credit lines within the past 6 months, the credit bureaus will not give a score.  If a person’s credit card carries a balance of 50% or more than the card’s limit, the score can go down by as much as 40 points. 
I’ve unknowingly done that and my credit dropped drastically.  I paid the card off and my credit shot up. 

2.Some people are very responsible paying their bills, have little to no lates but still have a low credit score.  High credit card balances is often the reason.

A person with a lot of open credit cards also can negatively affect his or hers credit.  Keep the number of credit cards you use to a minimal.  Too much open credit is viewed negatively, because a person can get into debt very quickly.

Conclusions:  Verify the applicant has enough income to cover all of their bills and rent.  Ask to see a pay stub, call and talk with their employers.  Renting Authority can call and verify employment if you don’t want to hassle with it.

3.     Crime Scene: Medical Issues
Clues:  Medical bills can become uncontrollable for most anyone.  Even if you have good insurance, some treatments and emergencies can make most people go broke.  I have a brother who lost two sons in the past 14 month to cancer.  Beside the grief from losing two children, the bills are outrageous.

Conclusion:  Is this still a credit worthy person to rent to?
Look at the dates on the credit report where medical collections show.  Most medical issues I have seen cover a 6 month to 2 yr time period.  You may notice there are lots of lates in this same time period.  If after this time period you do not see lates, other collections, then the person is onto credit recovery.  This may be a good tenant.

3.         Crimes Scene:  Charge offs, Bankruptciesand Liens
Clues:  Public record information gives a lot of clues about a person’s credit worthiness.  I think we all agree that charge offs, bankruptcies, foreclosures and liens are bad.  None of us want them.  However, (and this is a big however), sometimes they really help a person’s credit in the long run.

Conclusion:  Charge offs are classified as satisfied and or open.  If it is satisfied, it means that a person paid off the debt even after a business wrote it off.  A person who satisfies a charge off shows character.  This is a person who cares about paying of their obligations. They are more likely to pay their rent. The same is true for liens.

Bankruptcies can help a person get out from under a financially difficult and oppressive situation.   Bankruptcies definitely hurt a person’s credit.  And it shows up for 7 yrs.

Clues:  The good in bankruptcies is it gives a person a second chance to rebuild their credit.  Look at the date of the bankruptcy and see if there have been other negative credit issues after that date.

Conclusion:  If everything is positive after the bankruptcy, the person is probably a good risk.  I have seen credit scores in the high 600s and low 700s with a bankruptcy in the past 3 yrs.

A good forensic investigation yields good tenants.  If you need help understanding a person’s credit, please call or write.  I am always glad to help.
Thanks,
Troy
888-674-9181
tboldt@RentingAuthority.com
www.RentingAuthority.com

This week I had some great conversations with many of you.  A couple of issues were brought up that you should all know about.

Issue #1
The applicant doesn’t want me to run his credit because he doesn’t want his credit score affected. What should I do?

When you as a landlord check a person’s credit, it is called a soft hit on their credit.  This means it will only stay on their credit report for 2 to 3 months.  Their credit score will not be affected long term when you check their credit.

I have found often that a person who does not want you to check their credit has credit issues that they are hiding from.  You need to establish your own rule that you check everyone’s credit. 

Another thing to consider is if an applicant is trying to dictate how you run your business now, they will continue to cause you issues in the future.

Issue #2

My tenant wants to pay cash.  What should I do?
Cash is king, but not in the landlord business.  This is big red flag. Why? People often want to pay cash because they do not have a checking account and they have money gotten from illegal means.  Drug dealers are some of the biggest offenders of this.  Now this does not mean that everyone who wants to pay with cash is doing something illegal nor is a drug dealer.  It is better to be safe that sorry.

Last week I received an email from a landlord who rented to a person who seemed to be a great applicant and wanted to only pay in cash.  The tenant paid the deposit and first month’s rent in cash.  That was all he ever paid.  The landlord is now going through the eviction process.

In summary, screen your applicants and don’t take cash.

We have made the procces of emailing a rental application very simple.  You don’t need to cut and copy and attach.

Here is what you do need to do.

Need to registered. (registration is free and simple) If you are not a registered member, go to www.rentingauthority.com and click on Free Rental Application (under Rule 1).  In the white box click on email rental application.  Follow the step by step instructions to register and customize your rental application. 

Already registered: If you are a member, go to www.toolbox.rentingauthority.com and log in.  Click on email application under the heading Screen Applicant.

Fill in the applicants email address, Click send.  You and the applicant both receive a copy of the email. 

The applicant clicks on a link inside the email and fills out the application.  The applicant also pays a $24.95 processing fee which covers your costs of running a background and credit check. 

The Results:  You receive a rental application, background and credit reports on an applicant.  The reports and application are stored for you online at www.toolbox.rentingauthority.com.   You can review them and then accept or deny the applicant.

Emailing the application really is simple.  If you ever need any assistance, call or get our online support.

Thanks,

Troy

Have you ever done the following?

1. Told an applicant there is not an opening because you did not want to rent to that person, when there really is an opening.
2. Advertised in such a manner that indicates a preference base on group characteristics, such as skin color or sex.
3. Set restrictive standards for certain applicants and not others, such as higher income.
4. Refusing to reasonably accommodate the needs of disabled clients, such as hearing dog, sight dog, or other service animals
5. Had different sets of late payment penalties for different tenants.

The Fair Housing Acts prohibit landlords from taking any of the above actions based on race, religion, or any other protected category:

Personal Information

This shows where a person lived when they applied for credit.  This will not show everywhere a person has lived.

Employment Information

This shows where a person worked when they applied for credit. This will not show everywhere a person has lived.

Report Summary

This area of the report shows the number of 30, 60, and 90 day late payments a person has had.  This section also shows credit limits and the amount of debt a person has.

Scorecards

This is where you see a person’s credit score.  This shows what type of a credit risk a person poses to a potential creditor.  Here is a simple break down:

550 and below is poor

600 to 650 is fair

651 to 700 is good

701 to 750 is great

750 plus is excellent

Collections

This section shows which accounts have gone to collections.   You can view the amount and if they have been satisfied.

Public Records

This area shows bankruptcies, liens, judgments, and evictions.

Trade Lines

This gives a detailed account of extended credit.

Inquiries

This lists out inquiries into a person’s credit.

If you need to screen another tenant, click here

www.rentingauthority.com

Here’s a quick video clip of an officer who has seen the ugly side of renters.

You must watch this.  If you a new or seasoned landlord, you will gain some great insights.

Listen to what Officer Mark Petersen has to say about potential dangers of renting to the wrong person.

He touches on these four areas:

1. Wolves in sheep clothing
2. Portable Meth Labs
3. Insurance companies and civil evictions
4. Tenant Screening

The video clip runs about 2 minutes.  To watch it, click here:

 http://www.rentingauthority.com/sites/testimony.html

Please gives us your comments about this video.  We also would love to hear any story about your tenants