Over 50% of Los Angeles County residents are renters, and over 50% of these renters are “rent burdened”, which means they spend over 30% of their income on rent, Neighborhood Data for Social Change reveals. This ups the likelihood of late payments and eventual eviction, which results in loss of time and money for you. As LA’s rental market becomes increasingly competitive, you need to do what you can to secure reliable, problem-free tenants. A comprehensive landlord reference check is essential here. Contacting previous landlords can help you identify great tenants and reveal red flags that may not show up in other screening processes.
Do some initial research
Before you contact a tenant’s listed references, first do a quick Google search to verify they’re real. Look up the previous landlords’ details (as provided by the tenant), which should include the business name and address. If nothing pops up, that’s a major red flag. However, if you do find a match, but some of the details aren’t as your tenant described, don’t automatically assume dishonesty. It may just be the case that the landlord has changed name or location, for instance. So, simply contact the landlord and ask them to please clarify the situation.
You can also use a tenant screening company to generate an accurate rental history report that essentially documents the tenant’s track record. In addition to past landlord details, this report also includes the tenant’s credit report and criminal history (if any). So, if a tenant has given you false information, you’re sure to find out through this report. In fact, over 90% of landlords and property managers perform checks of this kind to vet tenants. It’s therefore also important tenants check their own rental history report and make improvements where possible, so they can stand out to new landlords. For instance, tenants should maintain good relationships with landlords and part on good terms to secure positive future references.
Ask the right questions
It’s easy for tenants to make up fake emails as references, but much harder to fake a phone call reference. That means you need to talk to references over the phone to confirm their veracity. You’ll also usually get a better sense of exactly how a landlord rates a tenant through a real conversation, rather than via email.
So, first, ask the landlord whether the tenant paid rent on time and in full. This is a key indicator of reliability and financial security. Also, ask how much the rent was. You can then compare this to your rental rate, and get a realistic idea of whether the tenant is able to pay you. Next, you can move onto questions that reveal what kind of tenant they were — hopefully, responsible, communicative, and pleasant to deal with. Ask whether they looked after the property well. You (or the property management company) will need to communicate with the tenant regularly about repairs, inspections, and rent, so it’s important to know the tenant’s forthcoming and easy to talk to.
Watch for red flags
Once you’ve contacted the references, consider if there’re any red flags that indicate you should deny the application. For example, if the tenant has a history of late payments, there’s a risk they’ll continue to not pay on time with you. Around 15% of Americans are currently behind on rent, so this is something you need to look out for. Even if the tenant hasn’t necessarily been evicted for this behavior, it’s likely still too much of a financial risk for you not to deny their application. Or, if they have been evicted in the past, this again may be indicative of a poor payment history (either late or non-payments). That’s another sign you should avoid.
And, if the references seem suspicious in any way, reject the application. For instance, if the landlord doesn’t pick up the phone or you haven’t been given the right details, don’t just let it slide and continue with the tenant’s application. Explain to the tenant that it’s essential you talk with the landlord — otherwise, their application will be rejected.
Reference checks play a key role in the tenant screening process. Take the time needed for due diligence to vet tenant’s thoroughly, and you’ll save yourself time, money, and headaches in the long run.
