Every property and apartment manager has his or her particular criteria for tenant screening. There are two basic ways to accomplish this: in-house, which can be problematic because accurate results aren’t guaranteed, and the leg work is time-consuming. The other method: outsourcing background checks to a background screening company.
Should you elect to outsource, Google “renter applicant screening” or “background check,” and dozens of companies vying for your business will pop up. How do you determine which service provider is best for you? A full-service background screening company is your best bet. (Disclosure: I own and manage such a service, The Gold Shield Agency.)
What a full-service background screening company must provide
A full-service tenant verification company meets these requirements:
- The service verifies the applicant’s name, date of birth, and social security number. This is necessary to avoid mistaken identity, which is a real possibility with both less familiar and very common names, people with more than one name or with hyphenated names, and women who have been married more than once. The goal here is to filter out those who may be representing themselves using false information.
- The company is compliant with the Fair Credit Reporting Act (FCRA), such as a consumer reporting agency (CRA). The FCRA was passed in October of 1970 and then strengthened in 1997 to insure accuracy of background checks, including those for the purpose of determining eligibility to rent and to protect the rights of applicants.
- After an applicant’s personal information has been verified, the CRA will conduct a nationwide criminal background check which meets FCRA standards, as well as nationwide sexual offender, predator, and pedophile searches.
- A full-service CRA will conduct a search of county and circuit court records in every county the applicant has lived for at least the past five years. This is important to determine real-time credit information. For example, this search will reveal whether an applicants have been evicted, foreclosed, are “dead beat” parents or spouses, been sued for non-payment, had wages garnished, or have had other civil actions filed against them, such as a restraining order.
- The CRA will customize a screening plan to meet your additional needs such as verifying employment, contacting former landlords or references, or running an Office of Foreign Assets Control (OFAC) search or Patriot Act Terrorist Watch list search.
Additionally, a good CRA:
- Does background screening on its own employees before hiring them
- Verifies the accuracy of your completed report
- Has a program in place that defines their process for protecting the applicant’s personal information
- Can provide you with the necessary release, consent, and information forms
- Has a valid business license and a physical location
- Presents a clearly defined pricing and payment schedule, with results returned to you the next business day
How to find a rental screening company
The proper screening of applicants is necessary to protect your property and the safety and security of other tenants, so it pays to establish a good working relationship with your CRA. But first you have to find one. Ideally word of mouth, such as a referral from a colleague, is the best way.
A Google search will list the largest companies first before displaying the smaller ones. Smaller may be better because it’s likely you will receive more attention. Property manager social media groups, such as those found on Linkedin and Facebook, are another great resource.
Once you have narrowed the field (the CRA does not have to be local as they all have nationwide screening capabilities), call, or go to their office if it’s nearby, and interview the owner. Don’t be bashful and clearly state your expectations. And finally, armed with this list of requirements I’ve put together for you, make sure to ask lots of questions.
This article is not intended to nor does it offer legal advice; contact your attorney for legal questions or concerns. If you do need additional information, please email me at email@example.com.
And if you have ideas of your own about finding the right tenant screening service, why not leave a comment and join the conversation?Read more on Scaling