Here is my screening process when looking for a tenant. As a landlord and Realtor, I have leased HUNDREDS of places - these are the red flags I've noticed and how I now go about selecting the best tenants. Enjoy! Snapchat/Instagram: GPStephan
1 .Bad Credit Score. This is something I can sometimes let slide depending on the situation, but generally this is a red flag. A credit report and score shows you how responsible your tenant is paying their bills and loans. Often times if you see they’re behind on car payments, medical bills, have liens or judgements against them…chances are, they’re not going to be an ideal tenant. Now every situation is different and each case is treated individually. But generally speaking, if they’re consistently late on their bills, have large amounts in collections, and otherwise they don’t care - pass.
2.The next red flag is when the tenant has a lot of unreported income. First of all, regular cash deposits are usually an immediate red flag that something is sketchy, and the type of person who does this for the purposes of avoiding the IRS is already not someone I want to associate myself with. But generally with cash income comes infrequent income, and this is the type of tenant who might not have rent every month. Usually this type of tenant is doing something sketchy, it might not be sustainable, and it’ll be inconsistent. They could also be trying to hide from collections by keeping what they need to in cash, so I suggest looking closely at avoiding this person.
3. The next one is wanting to move in ASAP. Although this isn’t always a red flag, this is something I’m extremely weary about. This is something I take on a case-by-case basis. Some times the tenant just didn’t have time to find a place and their lease is up…that’s cool if you can verify it. Other tenants just want to get the house hunt out of the way by locking something down ASAP and then having an overlap, that’s cool to. But there are other tenants who are in the process of being evicted or forced out of their last home and just need somewhere to move immediately and use this as a negotiating point for landlords. Be weary of someone willing to move in immediately, it could be fine or it could be a way for a tenant to lock something down before they’re evicted. Find out why they’re moving and if you trust that’s the truth.
4.The next is not providing their previous landlord’s information or lying on their application. Many tenants refuse to put their landlords information on their applications. Many times they’ll have an excuse like they aren’t on good terms, its a he said she said story, or they don’t want to tell their landlord that they’re moving…in any event, it’s an immediate red flag and seems sketchy to me. If they’re not providing their landlords information, they’re withholding information from you to make an informed decision about this tenant. Many tenants will also lie on their applications and put someone else’s number who will pretend to be the owner. If this happens, immediately cut them off…this happens way more than you’d think.
5.Doesn’t show u on time or doesn’t pay on time. Hopefully this happens BEFORE you sign a lease with them. If the tenant doesn’t show up on time for an appointment, this is something you should consider. Generally the people who don’t show up on time will not be the type to pay on time. Make it a priority for the tenant to pay on time. Another one is if the tenant doesn’t pay their deposit or first months rent on time…if they make an excuse early on, take this as a sign that they aren’t the right tenant for you.
6.Trust your gut - if you feel uneasy about someone, go with your intuition. I really believe that your intuition will pick up things that a logical approach will not…if you feel uneasy about a tenant, trust it. Even if everything logically checks out, it’s important you feel confident and sure of your decision on a gut level as well.
If you follow the above, you’ll be in a much better position to pick the right tenant.
For business inquiries or one-on-one real estate investing/real estate agent consulting or coaching, you can reach me at GrahamStephanBusiness @gmail.com
Suggested reading:
The Millionaire Real Estate Agent: http://goo.gl/TPTSVC
Your money or your life: https://goo.gl/fmlaJR
The Millionaire Real Estate Investor: https://goo.gl/sV9xtl
How to Win Friends and Influence People: https://goo.gl/1f3Meq
Think and grow rich: https://goo.gl/SSKlyu
Awaken the giant within: https://goo.gl/niIAEI
The Book on Rental Property Investing: https://goo.gl/qtJqFq
Favorite Credit Cards:
Chase Sapphire Reserve - https://goo.gl/sT68EC
American Express Platinum - https://goo.gl/C9n4e3
1 .Bad Credit Score. This is something I can sometimes let slide depending on the situation, but generally this is a red flag. A credit report and score shows you how responsible your tenant is paying their bills and loans. Often times if you see they’re behind on car payments, medical bills, have liens or judgements against them…chances are, they’re not going to be an ideal tenant. Now every situation is different and each case is treated individually. But generally speaking, if they’re consistently late on their bills, have large amounts in collections, and otherwise they don’t care - pass.
2.The next red flag is when the tenant has a lot of unreported income. First of all, regular cash deposits are usually an immediate red flag that something is sketchy, and the type of person who does this for the purposes of avoiding the IRS is already not someone I want to associate myself with. But generally with cash income comes infrequent income, and this is the type of tenant who might not have rent every month. Usually this type of tenant is doing something sketchy, it might not be sustainable, and it’ll be inconsistent. They could also be trying to hide from collections by keeping what they need to in cash, so I suggest looking closely at avoiding this person.
3. The next one is wanting to move in ASAP. Although this isn’t always a red flag, this is something I’m extremely weary about. This is something I take on a case-by-case basis. Some times the tenant just didn’t have time to find a place and their lease is up…that’s cool if you can verify it. Other tenants just want to get the house hunt out of the way by locking something down ASAP and then having an overlap, that’s cool to. But there are other tenants who are in the process of being evicted or forced out of their last home and just need somewhere to move immediately and use this as a negotiating point for landlords. Be weary of someone willing to move in immediately, it could be fine or it could be a way for a tenant to lock something down before they’re evicted. Find out why they’re moving and if you trust that’s the truth.
4.The next is not providing their previous landlord’s information or lying on their application. Many tenants refuse to put their landlords information on their applications. Many times they’ll have an excuse like they aren’t on good terms, its a he said she said story, or they don’t want to tell their landlord that they’re moving…in any event, it’s an immediate red flag and seems sketchy to me. If they’re not providing their landlords information, they’re withholding information from you to make an informed decision about this tenant. Many tenants will also lie on their applications and put someone else’s number who will pretend to be the owner. If this happens, immediately cut them off…this happens way more than you’d think.
5.Doesn’t show u on time or doesn’t pay on time. Hopefully this happens BEFORE you sign a lease with them. If the tenant doesn’t show up on time for an appointment, this is something you should consider. Generally the people who don’t show up on time will not be the type to pay on time. Make it a priority for the tenant to pay on time. Another one is if the tenant doesn’t pay their deposit or first months rent on time…if they make an excuse early on, take this as a sign that they aren’t the right tenant for you.
6.Trust your gut - if you feel uneasy about someone, go with your intuition. I really believe that your intuition will pick up things that a logical approach will not…if you feel uneasy about a tenant, trust it. Even if everything logically checks out, it’s important you feel confident and sure of your decision on a gut level as well.
If you follow the above, you’ll be in a much better position to pick the right tenant.
For business inquiries or one-on-one real estate investing/real estate agent consulting or coaching, you can reach me at GrahamStephanBusiness @gmail.com
Suggested reading:
The Millionaire Real Estate Agent: http://goo.gl/TPTSVC
Your money or your life: https://goo.gl/fmlaJR
The Millionaire Real Estate Investor: https://goo.gl/sV9xtl
How to Win Friends and Influence People: https://goo.gl/1f3Meq
Think and grow rich: https://goo.gl/SSKlyu
Awaken the giant within: https://goo.gl/niIAEI
The Book on Rental Property Investing: https://goo.gl/qtJqFq
Favorite Credit Cards:
Chase Sapphire Reserve - https://goo.gl/sT68EC
American Express Platinum - https://goo.gl/C9n4e3
What if there on house choice vouchers program and they have disabled conditions for the floors for bad knees and spine fractures that never healed right bad fracture vertebrae that happened in may 2023. And they may have a payee of the tenants who have a nasty bullies landlords if they don't bothered to call the payees and may be interested why tenant may have too find a new payees for them. I had this happen and my daughter husband has a payee that's is late sending the money for rent. Because of this issue the owners decided house choice vouchers program worker who sends the check has to be paid with a credit card and debit card, no money order or regular checks.
But the head managers lucinda gerver is on a major power hunger.
Twice it's happens you as a tenant has too get on the public housing office worker told tell them where is the check coming or due I pay in full?
I always arrive at their net income as well based on the credit report or any other obligation they have monthly. Great Video, Graham!!
3× minimum requirement crazy especially for a single person, but 1000$ isn't bad for rent for an apartment, but once you reach that 1400 a month, that gets crazy with the 3× rent
How do I deal with an applicant that has been retired, traveling full time the past three years internationally, has SSI and does side work for extra income (i.e. UBER)?
thank you!
So much value provided here, thanks✨
Good video
Great tips!
Whenever you call employers: open the call with “hi I was calling to see if you are hiring right now.”
For landlords “Hi I was calling to see if you have any available properties to rent.”
You will catch a bogus reference quickly this way when they act confused, aren’t an employer, or aren’t a landlord.
How do y’all tenants pay you for the people in real estate investing
I’m no longer amongst the 56%! Thanks for the info
Also, people who omit cash from financial institutions may be involved in fraudulent activity.
I definitely got a lot out of listening to you. The part where you mentioned Facebook was mind blowing. The mental health crisis is something else we're looking at right now and this needs to be minded as a landowner who lives on the property. The opioid epidemic is exacerbated now, but things like withholding cash from bank accounts and maxed out credit potentially hint toward that. Meeting in person is so important before accepting the deposit and first month before signing, because not everyone is an addict. However, the shifty behavior of omitting cash from institutions are telling about a person who is financially irresponsible.
Hi @Graham Thanks for the very good info. may important is it to have Tennent's waiver of subrogation ? how do I do that, pls share if you have a sample writeup
What the f*** are you the police
You sound like you discriminate against people I'm glad you not my landlord
Charge that drug dealer more! That way you can save for the months they skip out the home. Lol.
Something I am unclear about. If an applicant passes all criteria credit check, criminal, rental history but you just don't want to rent to them…As far as I can tell there's nothing wrong with this. Correct?
Thanks!
Address ETHIOPIA
Age 20
City Harar
Country ETHIOPIA
Name Ferhan Abdulhamid Ahmed
Ok. What about landlords ?
What kind of track record do you have ?
Will you fix things when they break down ?
Or give excuses ,keel putting it off .
Example toilet broken .leacks under the tank
Crack in the tank toilet constantly runs ,making water bill higher.
Using bath towels to wrap a round the toilet to keep water from puddleing on the floor . I pay rent plus now a higher water bill .
I tell.landlord but to avail nothing being fixed .
Where is the creditability of the landlord ?
Background check is really important. Aside from the things you mentioned, the risk of renting your property to someone who does illegal activities is high. The payment is not the problem here as they really have cash to pay for rent, but the major problem you really want to avoid is the consequence of illegal activities done in your property. Civil forfeiture is really scary. That's why you should always check your potential tenants and spot the red flags.