About one in three U.S. households is renting these days. Given the recent spike in mortgage rates and rising home prices, that number has gone up significantly over the past few years. Evictions have gone up as well in cities across the country.
When it’s your property, you want to make sure you’re renting to someone with the ability to treat your property well and pay the rent on time. A tenant screening report helps you verify identity, credit history, and public records when making rental decisions.
What Tenant Screening Companies Do
Tenant screening companies provide the information you need. They compile consumer data from multiple sources and present it in a structured format so you can see an applicant’s background. The information included in these reports typically comes from credit bureaus, public court records, and identity verification systems.
By combining multiple data sources into one report, tenant screening report providers give you the details in an easy-to-read report.
What Information Is Included in a Tenant Screening Report
A tenant screening report typically contains the information you need to evaluate an applicant’s reliability and financial stability, including:
- Credit and financial history: Shows payment history, outstanding debts, and accounts in collections to help landlords evaluate an applicant’s financial reliability.
- Eviction and housing records: Identifies prior eviction filings or housing court disputes that may indicate previous conflicts.
- Identity verification and address history: Confirms the applicant’s identity and lists prior addresses to validate the accuracy of the rental application.
- Criminal record searches: Provides publicly available court record information that may reveal felony or misdemeanor convictions relevant to screening decisions.
Why Choosing the Right Screening Provider Matters
There are complex rules that must be followed, including the Fair Credit Reporting Act (FCRA) and the Fair Housing Act (FHA). States also have their own regulations, and many cities do as well. In many cases, they are far stricter, especially when it comes to the type of information that can be used and how it can be used.
One of the biggest problems landlords face is inconsistency, either in the data they get or the screening standards they apply. Reliable tenant screening companies will make sure you get current data and apply consistent screening standards in compliance with federal, state, and local laws.
Key Factors to Consider When Comparing Tenant Screening Companies
When you’re comparing tenant screening companies, there are several key factors you should consider.
How Tenant Screening Fits into the Rental Application Process
Tenant screening is usually part of a structured rental application process. Applicants are asked to submit a rental application that includes name, address history, and employment details. Typically, applications also include written authorization to conduct screening, as you need prior legal consent to run someone’s credit.
Once authorization is provided, the landlord requests a tenant screening report from a screening provider. Once the report is ready, it’s reviewed along with references and income verification to make decisions.
If a tenant screening report is used in part as a reason to deny an application or modify the terms of a lease, landlords must provide an adverse action notice, which provides contact information for the tenant screening companies used, the applicant’s right to get a free copy of the report, and their right to dispute inaccurate information. Some jurisdictions require you to provide a copy of the screening report as well.
For landlords and property managers who need reliable consumer data to support rental screening, Command Credit provides access to consumer credit reports and tenant screening services on demand. Contact Command Credit today to get started.