Posted by & filed under Tenant Screening.

Close-up Of A Human Hand Filling Lease Agreement Form With Pen

When a tenant’s lease is coming to an end, you’ll have to make a decision: whether to renew the lease or part ways. If the tenant has been reliable, responsible, and a good resident overall, the easiest choice is to renew the lease. Finding a new tenant can be stressful, even with screening services. It can be time-consuming to market the property, sort through applications, and show the unit. And the longer it takes to find a new tenant, the more expensive the process becomes.

Here’s a look at why renewing a lease is beneficial, and some tips on how to go about doing it. Please note that this is for informational purposes only and is not intended as legal advice.

Why Should I Renew a Lease?

First, what does it mean to renew a lease? Renewing the lease typically means signing your existing tenant to a new lease, with terms that are the same or similar to their current lease. This can also include an extension of their current lease, which keeps the same terms and extends out the end date.

Here are a few benefits of renewing a lease:

  1. Eliminates the cost of finding a new tenant

There can be many costs associated with finding a new tenant. These include:

  • Advertising
  • Cleaning or repair costs after the tenant has moved out
  • Maintenance (like replacing old carpet, fixtures, or appliances)
  • HOA dues (if applicable)
  1. Reduces the risk of vacancy

If you don’t already have a tenant lined up to move in when the current tenant moves out, you risk losing income from the vacant property. Not only do you lose out on rental income, but you’ll also have to continue to pay for utilities or other expenses associated with the property.

  1. Minimize stress

Searching for a new tenant can be stressful so once you find a good tenant, it’s best to keep them. There’s certainty with your current tenants – you know what to expect and already have an established relationship. Even though tenant screening and verification give you an excellent idea of a tenant’s responsibility level and rental history, it doesn’t necessarily tell you what an applicant would be like on a personal level. If your current tenant is paying their rent on time and does a good job of keeping up the property, it’s worthwhile to renew the lease.

  1. Save time overall

When a tenant moves out, there’s often quite a bit of work involved to get the property ready for the next tenant. This includes cleaning, maintenance, preparing a listing, looking over applications, interviews, showing the property, deciding who to screen, and making a final decision. Retaining good tenants eliminates these steps and frees up time for you to focus on other aspects of your business.

Tenant Retention

Something to consider: A Zillow trend report from 2018 found that nearly half of all renters (46%) who had moved within the past 12 months had plans to move again within the next year. So how can you ensure that you keep good, reliable tenants? Here are a few things that can help:

  • Make them feel welcome at the property
  • Help them feel connected with the neighborhood by giving pointers on things to do, where to shop or eat, etc.
  • Be available and easy to contact
  • Respond to questions, concerns, or requests quickly
  • Provide ample notice for changes or problems that could affect them
  • Allow some personalization of the unit or property
  • Be considerate of their privacy and rental needs
  • Keep up on maintenance
  • Keep features of the property updated
  • Enforce rules fairly and consistently
  • Foster a personal (but still professional) relationship

Click here for more tips on how to get a good tenant to renew their lease.

Do I Have to Renew a Lease?

Whether or not you’ll have to renew a lease depends on your local laws; some areas have laws that restrict or limit a landlord’s ability to not renew a lease. However, in most cases, landlords do not have to renew a lease. Likewise, a tenant can also choose not to sign a lease renewal. If you’re unsure what the local laws are surrounding lease renewals, it’s best to consult with legal counsel to ensure you’re doing everything by the book.

Depending on where your property is located, landlords generally have 30 days prior to the end of the lease to notify a tenant if the lease won’t be renewed. This can be done through a written notice of termination or a non-renewal of lease letter, which confirms the end date of the lease and move-out instructions.

Some areas don’t require you to include a reason for terminating the lease once it ends, however, you may be prohibited from ending a lease in retaliation or if it’s discriminatory towards a protected class under fair housing laws. Some reasons to consider not renewing the lease include:1

  • Unreliability, such as consistent late rent payments
  • Damage to the property beyond normal wear and tear
  • Lease violations
  • Frequent complaints from neighbors or other tenants
  • You’re selling the property or have hired a property management company

How Do I Renew a Lease?

If you’ve decided you’d like to renew a current tenant’s lease, it’s recommended to send them a renewal letter to let them know you’d like to continue renting to them. Make sure to include whether the terms of the new lease will be the same or if you plan on making adjustments. The renewal letter (also called a lease renewal agreement) serves two purposes: it informs your tenant that the lease will be ending soon and it also allows you to gauge their level of interest in continuing to rent your property.

The laws surrounding lease renewal letters vary from location to location, but typically they should be sent to the tenant at least 90 days before the lease expires. This will give your tenant plenty of time to make a decision and find new housing if they don’t plan to renew.

How Do I Write a Lease Renewal Letter?

Here’s an overview of what you should include while writing your lease renewal letter:

  • Your name and contact information
  • The name and contact information for your tenant
  • The address of the rental property and unit number (if applicable)
  • A reference to the original lease (or better yet, a copy of it)
  • Your renewal terms or any changes to the original terms of the lease
  • The new rent amount (if applicable)
  • The proposed end date of the lease

Once you’ve written up the lease renewal letter, make sure to attach a copy of it to the original lease as documentation.

Negotiating Lease Renewal Terms

In some cases, your tenant may want to negotiate the lease renewal terms. Whether you want to negotiate is completely up to you. If you’d like to keep the tenant at your property though, it’s generally best to listen to their terms and consider working with them to create a new agreement. Some of the most common things changed in a lease renewal include:

  • The price of monthly rent
  • The cost of the security deposit
  • How payments can be made
  • The duration of the lease
  • Policies or rules for the property
  • Renter’s insurance requirements

Month-to-Month Leases

If your tenant wants to sign a month-to-month lease, it’s important to agree to the terms or terminate the lease before it expires. In some states, a lease may automatically carry over to a month-to-month lease unless it’s terminated. Month-to-month leases generally renew automatically each month unless the landlord or the tenant notifies the other party that they want to terminate the lease. In some areas, the tenant or the landlord is required to provide a 30-day written notice if they’re planning to terminate it; other areas require a 90-day notice. Be sure to read up on your local laws and consult with an attorney if you have any questions.

The Tenant Doesn’t Want to Renew

If the tenant doesn’t want to renew, they will typically be required to notify you in writing. However, there are some circumstances where they may not be required to provide notice. This includes situations like military deployment or being the victim of domestic abuse. If the tenant doesn’t want to renew, make sure to send them written confirmation of the lease end date and move-out instructions.

The Tenant Stays After the Lease Expires

Although it’s unlikely, what should you do if the tenant stays at the property after the lease has expired? You have a couple of options. If they continue to pay rent and you accept the money, this may be legally seen as a renewal of the lease in some locations. If they continue to live at the property without paying rent or otherwise violates the terms of the lease, you have the option to evict them. Regardless of what the situation is, you should always consult with an attorney to determine your legal rights and the best course of action.

Posted by & filed under Property Management.

Whether you’ve been screening tenants yourself or are searching for a new screening partner, Tenant Screening Center enables you to do the best work for your clients without interfering in your operations.

We bring you the best of both worlds: the personalized, responsive service of a smaller company, paired with credit scores and history from worldwide leaders in credit reporting.

Our traditional screening services and tenant verification allow you to have accurate reports tailored to your rental criteria. You’re in total control, without being at the mercy of technology or intrusion from a third party. Pay only for the reports you need.

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Other benefits of our tenant screening and verification services include:

  • Accessibility for multiple team members and agents
  • Fast turnaround times
  • Convenient integration with many types of property management software
  • Direct 24/7 access to request and view your selected reports
  • Live customer support

TSCI allows busy property management companies to do business the way they always have, without being boxed in or forced to conform to another company’s standards.

Find the freedom you need to do the best work for your clients while minimizing your task list and enjoying tailored service, timeliness, and efficiency.

For more information, visit us today at TSCI.com or contact us at 1-800-523-2381 Monday – Friday from 9 am to 5 pm PST.

Posted by & filed under Tenant Screening.

It can be a challenge to find the right tenant for your rental property – especially if you feel financial pressure to fill the vacancy quickly. Fortunately, tenant screenings can help you quickly eliminate tenants who aren’t a good fit and narrow down potential tenants who have a history of being reliable and responsible. In addition to the standard background and credit checks, it’s also a good idea to perform a tenant verification, which includes references from the applicant’s former landlords. A former landlord can fill you in on information that goes beyond the data-driven reports, giving you better insight into what you could expect if the applicant were to become a tenant.

However, it’s important to realize that fraud can occur when applicants supply references. It’s not unheard of for an applicant to ask a friend to fabricate a reference or documents to give them better chances at landing the rental. Maybe the renter severely damaged the unit, or they had other issues they’re trying to hide. According to one report conducted by a tenant fraud detection agency, 22% of applicants submitted fraudulent documents during the application process – this increased by 11% during the beginning of the COVID-19 outbreak between March and April last year.

So how can you tell if the information the applicant provided you is false? Here are a few tips to help you decide.

Look into the landlord’s past activity

Conceptual triangular hazard road sign against a stormy sky saying fraud alert

If you’ve talked to the reference on the phone but aren’t sure you believe they’re actually a landlord, try doing an online search for the property owner and the property itself. If the reference is a real landlord, you should be able to find some ads or posts for the rental that prove it’s a legitimate property. If there’s a dedicated website for the rental, check the Wayback Machine to see how long the website has been around. Unfortunately, there are online services that sell websites for fake references; it’s a good idea to check when the website was established.

Social media sleuthing

Social media can also be a good place to do a little sleuthing. Do a search on the reference’s name and see if they have any connections to the applicant. Are they tagged in each other’s posts or photos? This could be an indicator that they’re friends or family members. Do you notice any overlap between the applicant’s profile and the landlord’s profile? Although some landlords have a friendly management style, profile overlap is an indication that this is a personal relationship, rather than one of a landlord and tenant. Keep in mind that some landlords may not have a social media profile or talk about their business on social media.

Familial Interviews

When you’re chatting with the landlord or leasing team, make sure to pay attention to their tone. Do they sound nervous or uncomfortable? Are they able to answer your questions easily? If they seem nervous, it may not be that they’re a fake reference; some people aren’t comfortable talking on the phone, but it’s still something you should take into consideration.

Another thing to pay attention to is their comments. A real landlord will focus on useful rental information. They’ll know if the tenant ever paid their rent late, how much wear and tear occurred at the property, if there were any major damages or repairs, and if there were noise or other types of complaints from neighbors. These are all things that a friend or family member isn’t likely to know. If they provide general statements like, “they were an excellent tenant” without any details, this is a red flag. Likewise, if the person seems anxious to get off the phone, this could also be a sign of a false reference.

Check the ownership records

Most property tax records are public, so as long as you have the applicant’s previous address, you should be able to look up the owner by doing an online search. If the owner listed doesn’t match the name you were given, that could be a red flag.

Let TSCI Save You Time

Although there’s no completely fool-proof method to weed out fraudulent rental references, you can get peace of mind and save time by letting TSCI handle your tenant verifications for you. With over 35 years in the tenant screening industry, we have extensive experience determining the reliability of references. Our tenant verification services are low-cost and a great first step before moving onto credit or background checks. Our tenant verification service includes the following information:

  • The applicant’s current and previous address
  • The length of time they lived at each property
  • Whether the applicant gave proper notice of their intent to move
  • The applicant’s current and previous monthly rent payments
  • Whether there have been any late payments, bounced checks, balances owed, complaints on file, or legal notices
  • Whether the applicant has any pets
  • Whether the applicant would be eligible to re-rent either property
  • Verification of the applicant’s current employer
  • The length of time the applicant has worked at the company, their position, salary, and employment status (full time/part-time)

You’ll receive a form completed with the above details, giving you the information you need to make the most informed decision possible. For more information on this or our other screenings, contact TSCI today at (800) 523-2381 or purchase your tenant screening reports online.

Posted by & filed under Property Management.

On January 29, 2021, the California state legislature signed new legislation into law that extends the current COVID-19 Tenant Relief Act. The bill (SB 91) included several provisions that can be read in its entirety here. Please note that this is for informational purposes only and is not intended as legal advice or as a complete overview of SB 91.

Calculator with wooden house and coins stack and pen on wood table. Property investment and house mortgage financial concept

One of the most noteworthy provisions for the rental housing industry prohibits rental housing providers, tenant screening companies, or other entities from using COVID-19 rental debt as a factor when evaluating an applicant for tenancy. Likewise, COVID-19 rental debt cannot be a reason to deny an applicant that would otherwise qualify as a prospective tenant.

What Qualifies as COVID-19 Rental Debt?

The bill defines “COVID-19 rental debt” as any unpaid rent or other financial obligations the tenant has accrued during the ‘Covered Period,” which is between March 1, 2020, and June 30, 2021.

How Will SB 91 Affect Tenant Screening?

In response to the bill, TransUnion has made changes to the data provided in screening reports:

  • Eviction records that occurred in California during the covered period will not be included in the evictions report.
  • COVID-19 rental debt that occurred during the covered period will not be included in ResidentScore or VantageScore credit scores or reports.
  • No changes will be made to TransUnion’s batch credit reports.

To develop a strategy that will best fit your operations, we recommend discussing the new provisions with your legal counsel.

Posted by & filed under Rental Housing.

Real estate concept. Houses on schema diagram. Person search, compare and select proper rent apartment in laptop.

Rental housing laws regarding tenant screening, applications, and rental housing decisions are constantly evolving. Although it can be time-consuming and difficult to keep up, it’s important to make sure your written rental criteria adapt to the latest regulations. Updating your rental criteria annually is the best way to ensure you’re following all the guidelines – while avoiding actions that could cause legal issues. Here are some key factors to keep in mind to ensure your rental standards stay up to date and in line with the latest laws; please note this is intended for informational purposes only and is not intended as legal advice.

What are Rental Criteria?

You likely already know what rental criteria includes, but here’s a quick refresher. Rental criteria refers to a set of standards that applicants are required to meet in order to be considered “approved,” “conditionally approved,” or “denied” tenancy at your property. Although rental criteria can vary, it typically includes the following:

  • Credit scores
  • Income requirements
  • Specific criteria regarding eviction records
  • Specific criteria regarding criminal convictions

Although you can adjust rental criteria to your own standards and personal preferences, you’ll need to check to make sure you’re following Fair Housing Laws to avoid anything that could be seen as discriminatory. Likewise, it’s best to review your local laws to make sure your criteria don’t conflict with regulations regarding factors like criminal or eviction records.

If you choose to include criteria that involve current or previous landlords, or personal references, be cautious about the source. For example, it’s possible an applicant could provide the number of a friend or relative instead of a landlord. Tenant verification also less objective than credit history, for example, but it’s often the best first step to see if you’re interested in screening the applicant further. If you’re planning to include tenant verification in your criteria, save yourself some time and hassle by ordering yours from TSCI.

Key Factors for Creating Your Rental Standards

As you establish your written criteria and audit them annually, here are some important factors to keep in mind:

  1. Always Base Your Decision on Objective Data

Although some landlords and property managers investigate prospective tenants by looking at their social media or other subjective methods, doing so is a good way to potentially find yourself in legal trouble. Your leasing process should always use objective data, like credit, criminal, and eviction history.

A good way to make sure you’re not going out-of-bounds is to work with data from a tenant screening service, like TSCI. Screening reports provide objective, legal information to help you decide whether the applicant might be a liability.

  1. Avoid Blanket Standards

Blanket standards, also called bright-line standards, include overly broad language in your written criteria. This means the standards don’t factor in the differences between federal, state, and local laws. Blanket standards can increase your liabilities, as one may be able to argue that they’re discriminatory.

One example of this would be saying one of your requirements is “no felonies.” A rule like this doesn’t take into account that what one state considers a felony may not be considered a felony in another state. In some states, it’s considered a felony to possess marijuana; in others, it’s completely legal. Blanket standards could potentially bar a good applicant from meeting the criteria without considering why they were convicted.

  1. Local Laws

Write up a rough draft of your rental criteria, including the requirements for meeting “approved,” “denied,” and “conditional.” After that’s done, take a look at your local laws. These can significantly affect which information you’re allowed to use to make a decision on an applicant’s eligibility. For example, in Cook County, Illinois, landlords and property managers may only consider criminal convictions that have occurred within the past 3 years. In Seattle, Washington, the only criminal record you’re allowed to consider is the National Sex Offender registry.

This is especially important because many screening companies have an industry standard of criminal records going back 7 years. If you weren’t aware of a local law stating you can only consider the past 3 years, and you make a rental decision based on a conviction that happened 5 years ago, you could end up in legal trouble. Fortunately, TSCI follows all current local regulations regarding criminal and eviction records, so you aren’t provided with any information you can’t legally consider.

  1. Protected Classes

As long as you’re basing your rental decisions on objective data, considering protected classes shouldn’t be an issue – but it doesn’t hurt to review it anyways. As an added precaution, you should check to make sure your criteria don’t infringe on any federally or state-protected classes. This includes discriminatory language or criteria based on:

  • Race
  • Color
  • National origin
  • Religion
  • Sex
  • Familial status
  • Disability.

Depending on your state, you may have additional protected classes, such as source of income, sexual orientation, gender identity, or gender expression.

  1. Adjust Your Standards Based on the Property

It wouldn’t make sense to have the same rental standards for a luxury apartment as you would a small studio on the outskirts of town, so when creating your criteria, think about the types of applicants your property is likely to attract. If you have more than one rental, consider tailoring your criteria to each property individually. This could mean adjusting your income requirements or credit scores required for approval, or sorting your properties by type, and create a set of criteria for each category.

Apply Your Rental Criteria Equally

Once you’ve determined your leasing criteria, you’ll need to make sure you apply them equally to each applicant. Every applicant should be subject to the same qualifying questions, screening process, and rental standards. Even though your properties may have separate standards, make sure each applicant is treated equally within the property’s criteria.

This is one important reason to have your rental criteria written out. Whether you’re training a team at a property management company or you’re an independent landlord, written criteria give everyone a clear checklist, so to speak, that can easily be referred to. Without this, it’s easier to make exceptions or unintentionally overlook an important legal consideration.

For more information on vetting applicants, writing leases, and other helpful tips, visit our blog.

Posted by & filed under Property Management.

Messy Room

Dealing with messy tenants can be a tricky situation. Trash on the patio is one thing, but it’s another thing completely if there’s mold growing in your rental due to the tenant’s slovenly lifestyle. Everyone has a different idea of what “clean” looks like, so how can you ask your tenants you’d like them to keep the property up to your standards? Here are a few tips on how to go about asking your tenants to clean up their act. Please note this is for informational purposes only and is not intended as legal advice.

Why Does Cleanliness Matter?

Technically, landlords shouldn’t be telling tenants how and when to clean, but if their cleanliness is becoming a health hazard or could damage your property, this is a valid reason to address it.

Some tenants may not see their messiness as a problem. After all, they’re the ones living in it, so why should it matter? Unfortunately, there are some expensive issues that come with their way of living – which could come out of their security deposit. If you need to confront your tenants about their cleanliness, here are some issues you can mention:

  • Structural damage – Large, damp messes can leave behind unsightly stains, rot, and smells, that can only be removed by professional cleaners. There could also be damage to support beams or other important structures of the property, which could be a safety hazard.

  • Infestations – Messy living areas can attract a variety of pests, like cockroaches, water bugs, flies, ants, and rodents. Besides being gross, they can be a health hazard. Some of them can carry vector-borne diseases or affect allergies and asthma. If you have several units on the property, they can also impact neighboring tenants’ quality of life. Pests can be difficult – and expensive – to get rid of.

  • Hygiene – Good hygiene is an important topic, especially with the pandemic. Remind your tenant that you’re responsible for ensuring the property stays safe and clean for all tenants, including future residents.

When addressing cleanliness with the tenant, you may also want to consider their age. Are they a young college student? If so, it’s common for younger people to be a bit messy as they get into the groove of taking care of themselves. Try to put aside your frustration and view it as a positive teaching moment instead.

What Types of Cleanliness Issues Should Be Addressed?

Clutter and garbage here and there is unsightly, but it may not be enough to bring it up to the tenant. Here are some more serious issues that are worth addressing:

  • Mold
  • Animal feces
  • Excessive garbage
  • Rodents, roaches, or other pests
  • Overwhelming or unpleasant odors
  • Spoiled food left out or piles of dirty dishes
  • Sticky or strange substances left on surfaces
  • Junk or clutter that blocks entryways or air vents
  • Hoarding*

*If you believe your tenant is a hoarder, you should be careful with how you approach the situation. Since hoarding is considered a mental health disorder, there could be legal and medical protections to consider. Federal (and some state) laws prohibit discrimination based on hoarding and require landlords to make reasonable accommodations. If in doubt, consult with legal counsel on how best to proceed.

Keep Communication Open

Once you’ve noticed a cleanliness issue, it’s important to say something. If you noticed the problem and walked away, that’s understandable! It can be difficult to know what to say at the moment. Contact your tenant and let them know in a professional and kind way that you have concerns about potential health and safety violations.

Make sure to be understanding and address any limitations the tenant may have in their life, such as long work hours, family, or mobility issues. You should also double-check your lease to ensure you’ve included a clause that states the expectation of the tenant to maintain the cleanliness of the property for health and safety reasons. If you do have such a clause in your lease, make sure to bring this up in the conversation.

Tenants want to feel you care about them, the property, and the community, so make sure to let them know their health and safety are important to you. You can say something like, “It’s important to me that the property is safe for everyone, and it’s my responsibility to make sure it is. I’m concerned that the current state of the property could cause health and safety issues due to the [mold, pests, or other concerns].”

It’s always a good idea document when you talked to them and what was discussed. You may also want to consider sending a follow-up email regarding your conversation. This serves two purposes; it reinforces what was discussed, and it provides you with additional documentation.

In some cases, being firm about the cleanliness issue won’t be enough to get the tenant to change their ways. If you’ve already had a discussion and sent a follow-up email without any sign of progress, it may be time to send the tenant a formal notice. Check with your legal advisors to determine the specific language you should include and to make sure you’re going about everything legally.

Posted by & filed under Eviction.

eviction notice paper

On January 20, 2021, President Biden issued an executive order instructing the Center for Disease Control (CDC) to extend the federal eviction moratorium. Per the president’s request, the CDC announced on January 29 that the moratorium would be extended through March 31, 2021. While this likely came as good news to millions of struggling renters, it leaves many landlords saddled with financial burdens – particularly small independent landlords, who provide more than half of the nation’s rental properties.

Initially, the CDC order was slated to end in December, but it was extended through a provision in the second stimulus package. The order continues to require tenants struggling with payment to provide their landlord with a declaration of loss of income and inability to pay rent. Although renters are being assisted in the short term, the moratorium fails to address how many of them will be able to pay for owed back rent once the moratorium is lifted. In the meantime, landlords are still struggling to cover their own monthly expenses. Without the income from rent, it’s more difficult to maintain rental properties and meet other financial obligations.

There’s no question this is a complicated issue – and an ever-evolving one. Here’s a look at some of the most important things you should know about the eviction moratorium as it currently stands. Please note this is for informational purposes only and is not intended as legal advice.

How do Tenants Qualify for the Moratorium?

To qualify for the moratorium, tenants who are unable to pay rent must provide their landlords with a sworn declaration affirming the following:

  • The tenant has “used best efforts to obtain all available government assistance for rental or housing.”
  • The tenant earned $99,000 or less in 2020 as a single tax filer (or $198,000 or less for couples filing jointly). Tenants who weren’t required to file taxes in 2019 or who received a stimulus check also qualify.
  • The tenant has been unable to make full rent payments due to loss of hours, wages, layoffs, or high out-of-pocket medical expenses exceeding 7.5% of the household’s adjusted gross income for the year
  • The tenant has made every effort to make timely rent payments that are as close to the full payment as possible
  • That the eviction would either cause the tenant to be homeless or force them to move into a close-quarters living situation
  • The tenant understands they will still need to pay rent at the end of the moratorium
  • The tenant understands that any false or misleading statements could result in criminal or civil action

Landlords are not required to notify their tenants of the CDC order. In addition, the eviction moratorium doesn’t apply to tenants living in hotels, motels, or other forms of temporary housing.

Is Back Rent Forgiven?

Although a tenant may qualify for the eviction moratorium, unpaid rent still accrues. Some states also allow landlords to apply fees, interest, or other penalties to late rent payments. If the rent is more than $1,000 a month and hasn’t been paid since August 2020, your tenant would owe $1,000 for each month that went unpaid, as well as any interest or fees that you’re legally entitled to.

Do Tenants Automatically Receive Rental Assistance?

Even though a tenant qualifies for the eviction moratorium, they may not necessarily receive rental assistance. The moratorium applies to evictions exclusively. Renters may qualify for the assistance given their income is less than 80% of the median household income in their area, they’ve been adversely affected by COVID-19, and as a result, are at risk of losing their housing. If your tenant receives rental assistance, it can be used for utilities, back rent, or future rent. The qualifications for rental assistance are separate from those of the eviction moratorium.

Does the Moratorium Include Financial Assistance for Landlords?

Unfortunately, the eviction moratorium doesn’t include financial assistance for landlords – however, qualifying property owners can take advantage of the latest COVID-19 relief bill, The American Rescue Plan. This bill is set to provide $15 billion in grants for small businesses affected by the pandemic, as well as $175 billion in funding for small business loans and $30 billion in rental relief for tenants. Additionally, the bill will include new legislation that will extend foreclosures and eviction moratoriums through September 30, 2021.

As a landlord, you’ll still be able to pursue back rent, fees, interest, and evictions once the moratorium has ended. However, it’s important to know that violating the moratorium could mean facing fines as high as $100,000, a year in prison, or both. In the event that an eviction was somehow tied to the death of a tenant, the penalty can be as high as $250,000 and a year in prison.

Does the Moratorium Prohibit All Evictions?

No; only tenants who meet the qualifications are protected from being evicted. Additionally, you can still evict any tenant who engages in criminal activity on your property, threatens other tenants, or caused damage beyond regular wear and tear. Any tenant who acts in bad faith can have the eviction protection revoked.

That being said, it’s recommended to consult with legal counsel prior to evicting a tenant to avoid any potential fines or legal issues. The CDC’s guidelines are fairly straightforward, but they can be complicated with the addition of locally-enacted eviction moratoriums. Your legal team will be able to advise you further on the best steps to take.

Posted by & filed under Tenant Screening.

Tenant screening is common for landlords and property managers of single-family homes and multi-family homes, but what about mobile home parks? Although mobile home parks are somewhat unique, tenant screening and verification are equally important to ensure that you have reliable, responsible tenants.

What Are the Unique Considerations for Mobile Home Parks?

Mobile homes aren’t on a permanent foundation, so mobile homeowners can move at will; despite this, mobile homes aren’t frequently moved and will typically stay on the same lot once they’re installed. Unlike a single-family home or apartment, tenants often own their mobile home, so they’re just renting the lot – although some mobile home parks rent out homes as well.

For landlords who are only renting out the lot, there are often fewer concerns or more relaxed policies about choosing the right tenant. If the tenant causes damage to their own home, that’s on them. Due to this, it might seem like tenant screening is unnecessary for mobile home parks, but it’s important to remember that every tenant you choose becomes a member of a larger community. Mobile home parks are typically more intimate than the average residential neighborhood, which means neighbors are more likely to interact, and in turn, affect the overall feel of the community.

Mobile Home Park

No one wants to deal with neighbors who disregard the park’s rules or cause problems in other ways – and as a landlord, you don’t want tenants that pay rent late, either. It’s in everyone’s best interest to ensure that applicants with a good rental history are chosen. By taking the step to verify and screen your mobile home tenants, you can ensure that you’re building a thriving community of responsible tenants and reduce potential problems down the road.

What types of screenings should be run for mobile home parks?

We offer a variety of screenings to help you find reliable tenants for your community. With many state laws changing around when tenant screening can be used, tenant verification is often the best first step for many landlords. Our tenant verification service allows you to verify that the information applicants provide you is accurate, including:

  • The applicant’s current and previous address
  • The length of time they lived at each property
  • Verification of the applicant’s current employer
  • The length of time the applicant has worked at the company, their position, salary, and employment status (full time/part-time)
  • Whether there have been any late payments, bounced checks, balances owed, complaints on file, or legal notices
  • The applicant’s current and previous monthly rent payments
  • Whether the applicant has any pets
  • Whether the applicant would be eligible to re-rent either property
  • Whether the applicant gave proper notice of their intent to move

We conduct the verification on your behalf, saving you valuable time that can be spent on other aspects of managing your mobile home park.

Importance of Credit Checks

Credit checks are also important as they give you an idea of how well a tenant handles their debt. Applicants who were sent to collection agencies or defaults can be risky tenants, but so can those with a high debt-to-income. For example, if a tenant has a high amount of debt, they may have difficulty paying rent in the future, especially if they change jobs, have a baby, or experience other life events that might impact their finances. Background checks can be another very helpful screening tool, giving you information about eviction or criminal history.

All of our screening services are available online 24/7 and we offer RentalConnect, which allows you to defer the cost of the report onto the applicant. As with all our reports, we strongly suggest reviewing your local laws to ensure you’re using the information legally. Some states and local governments have enacted limits to when certain types of screenings can be conducted and under what circumstances. For more information and tips on tenant screening, visit our blog or contact us at 800-523-2381.

Posted by & filed under Rentals.

hand signing papers

Although interviewing applicants for your property may feel daunting, it’s an important step in finding the right tenant. Finding a tenant you have a rapport with from the beginning and who meets your rental criteria can make the whole rental experience easier on everyone and helps to ensure your relationship remains mutually respectful. So, which steps should you take when vetting applicants? Here are a few helpful tips. Please note that this is for informational purposes only and should not be considered legal advice.

Pre-Screening

Interviewing applicants can take up a lot of your valuable time, but you can reduce your workload by pre-screening them before moving forward. Some of the most important things to consider when pre-screening are:

Monthly Income

If your tenant can’t afford the rent, approving them for your rental is taking on a risk – and potentially setting them up for failure. Neither is fair, to you or the applicant. It’s recommended to select applicants who make at least 3x the amount of rent to make sure they’ll be able to cover it comfortably.

Credit Score

Many people have things that have negatively affected their credit score, but you should check to make sure that their score is in at least the “good” range. Credit scores show how a person handles their financial responsibilities, so it’s critical to make sure you’re choosing an applicant who’s in good standing with their debt and payments.

Employment History

Employment history can give you insight into an applicant’s reliability and stability. Although employment gaps aren’t necessarily red flags (especially if they happened during the pandemic) they could signal that your applicant has difficulty holding a job – which could affect their ability to pay rent consistently and on time.

Background Checks

It’s also common for seasoned landlords and larger rental agencies to run a background check and a credit check as part of their vetting process. These types of screenings can give you information about:

  • Criminal Records
    A criminal record can be a concern, particularly if your vacancy is in an apartment building where other people could be at risk. However, keep in mind that not all criminal records are the same – and be sure to check your state and local laws to make sure you’re using criminal records legally.
  • Past Evictions
    Although there are always two sides to a story, past evictions could be a red flag. While an eviction doesn’t necessarily mean the applicant would be a risky tenant, it’s worth asking them about it during an interview, as well as discussing it with their previous landlord.
  • Public Records and Court Cases
    Past lawsuits that appear on the background check should also be discussed with the applicant. Although some lawsuits are unavoidable and will have no basis in how the applicant would perform as a tenant (like divorce or child custody), other lawsuits may give you information about how they handle financial matters and how responsible they are, such as bankruptcy or unpaid child support.

What Should You Look for in the Rental Application or During the Interview?

After you’ve prescreened your applicant, it’s time to take a close look at their application and begin the interview process. Here are a few things you should look for on the application:

  • – All portions of the application should be completely filled out. References should have working contact information, dates should be filled in, etc.
  • – Ideally, employment history should have no gaps. If the applicant doesn’t include contact information for past employers, this could signal that they may have left on bad terms or were an unreliable employee in some way. Their employment field can also give some clues as to whether they’ll be able to afford rent or not.
  • – Lifestyle factors like pets or working night shifts should also be listed on the application to give you an idea of whether your property will be a good fit for their living situation.

To save time verifying information on the rental application, you may want to consider our tenant verification service. We’ll reach out to the current and previous landlord and current employer on your behalf to confirm the information provided on the application is accurate. Taking time to speak to their references gives insight into the honesty of your applicant and how they may behave as a tenant. For example, a past landlord may have important information about whether the tenant paid rent on time, how they cared for the property, and how they got along with neighbors. Talking to their employer can also give you valuable information about how they work with colleagues, their overall reputation, whether they’re a reliable employee, and whether they have a steady source of income.

Once the application checks out, you can prepare the questions for your interview. A rental interview is very similar to a job interview in that you’re essentially trying to determine whether the applicant will be a good fit. Some important “dos and don’ts” to remember when conducting an interview:

  • – DO ask about their employment and income
  • – DON’T ask about anything that could be considered a violation of the Fair Housing Act
  • – DO ask how many adults would be living at the property
  • – DON’T ask if they’re married or have kids, as this could be seen as discriminatory
  • – DO get approval to run a credit check
  • – DON’T have different rental criteria or screening methods for one applicant versus another. All your rental criteria and screenings should be the same across the board
  • – DO ask if the applicant has ever been evicted
  • – DON’T ask if the applicant has ever been arrested

If you have difficulty coming up with questions to ask, take a look at our list of 23 questions to ask potential renters.

Although the interview process can be lengthy, it’s well worth it to ensure you’re choosing the best tenant for your property! And with our tenant verification and screening services, you can cut down the time you spend on the pre-screening process. For more information on tenant screening and verification, visit our services page or contact TSCI at 800-523-2381.

Posted by & filed under Tax Season.

COVID-19 has amplified many things about our society, one of which being how interconnected landlords and their tenants are. When tenants are struggling to pay rent, it directly affects your livelihood. The Coronavirus Aid, Relief, and Economic Security Act (CARES) Act, passed in March 2020, did provide some tax relief for small landlords, but what about tax relief in 2021? Here’s a look at what you should know for this year’s taxes. Please note that this is for informational purposes only and is not intended as financial advice.

Changes with December’s COVID Relief Package

tax season calculator

In December 2020, a second stimulus package was passed. This reversed an April 2020 IRS ruling that stated business expenses paid for with proceeds from a forgiven Paycheck Protection Program (PPP) loan were not eligible for tax deductions. With this reversal, forgiven PPP debt is no longer considered taxable income so you can deduct these funds as long as you meet the requirements. Additionally, this also applies to Economic Injury Disaster Loan (EIDL) grants.

“Tax extender” tax provisions that were set to expire on December 30, 2020, have also been extended for an additional year some of them have been made permanent. Some of these provisions that could benefit you as a landlord include:

  • Mortgage Insurance Deduction – Eligible property owners may deduct mortgage insurance premiums that were paid for using private and FHA/RHA/VA payments.
  • Energy-Efficient Commercial Buildings Deduction – The Section 179D deduction for commercial and multifamily housing units that meet or exceed energy efficiency standards has been made permanent.
  • Depreciation – The depreciation period for multifamily rental units has been shortened from 40 to 30 years.

Does the New COVID Relief Bill Include Additional Relief for Landlords?

The American Rescue Plan (the latest COVID relief bill) is projected to be signed into law in early March. This bill is set to provide $15 billion in grants for small businesses affected by the pandemic, as well as $175 billion in funding for small business loans and $30 billion in rental relief for tenants. These should, hopefully, help many landlords who have been hit hard by the pandemic. Additionally, the bill will include new legislation that will extend foreclosures and eviction moratoriums through September 30, 2021.

At this time there doesn’t appear to be any tax-specifics for landlords, however, President Biden has indicated that he intends to pursue additional relief legislation that could have broader tax implications.

Will These Tax Law Changes Affect my Taxes for Prior Tax Years?

Some of these changes will apply to previous tax years. For example, you can apply your 2018 – 2020 net operating losses as far back as five years from when the loss occurred. Businesses, including landlords, can also deduct loan interest that totals 50% of taxable income for the 2019 and 2020 tax years. Check with your accountant or financial advisor to see if you should amend your tax returns from previous years.

Will States Provide Additional COVID Tax Relief?

Some states may be implementing additional tax relief for landlords, however, the majority of it will be handled at the federal level. New York has introduced three different bills that would put a 3% cap on penalties for unpaid property tax assessments from smaller landlords during the pandemic.

With the large amount of tax-related changes being made in the past year, it’s more important than ever to speak with a knowledgeable tax professional to ensure you’re taking advantage of any tax relief as it applies to your rental business.