One of the most time-consuming tasks of a landlord is screening potential tenants. Under most screening processes, property owners run criminal background checks, verify the employment status, and many more. However, for most property owners, especially those who own multiple out-of-state properties, screening can become an overwhelming task. All property owners want to fill their vacancies as quickly as possible, but it’s also crucial not to skip the essential process of tenant screening.
Why Do You Need to Screen Tenants, Anyway?
No landlord wants to experience tenant horror stories firsthand. While not all tenants are troublesome, in some cases, the “bad apples” do end up residing in the property. If you don’t screen your prospective tenants, you might find yourself dealing with ones who get into disputes with neighbors, do not pay their rent, damaging the property, and much more.
Below are the main reasons why you should conduct tenant screening at all times:
#1 To Determine Whether They Will Pay Rent on Time
Your investment property is supposed to generate a stable stream of income. If your tenants aren’t paying their rent, this is going to be impossible to do. By reviewing their past rental history, employment, credit score, etc. you can determine whether a tenant is likely to pay their rent on time.
#2 To Protect Your Investment Property
By implementing a rigorous screening process, you can gain peace of mind that your tenants are respectful toward your property. In reviewing a prospective tenant’s rental history, criminal background, etc., you can weed out the tenants who aren’t likely to be responsible residents.
#3 To Avoid Evictions
Eviction is a long and exhausting process that no one wants to go through. You’ll have to pay thousands of dollars in legal fees, but that’s not all. You are also responsible for preparing the pertinent documents that can support your claim. This is why evictions are always stressful, especially if you don’t have a property management firm by your side.
#4 To Protect Your Neighbors
Tenants with a criminal history, or those registered in the sex offender registry, may be a liability. While you shouldn’t disqualify a tenant solely on their criminal past, if you discover that an applicant has committed a serious crime that would make your neighbors uncomfortable, you should trust your gut.
What are the Benefits of Screening Tenants with AI?
Using Artificial Intelligence (AI) in tenant screening is a relatively new practice. It helps many property managers and property owners streamline the screening process by analyzing multiple pieces of information at once. AI makes use of a unique algorithm that “scores” each prospective tenant based on factors such as rental history, credit score, and other important data — all of which determine whether an individual would be a qualified tenant.
If you’re on the fence about using AI the next time you screen tenants, we have compiled the top benefits to help you make that decision:
#1 Improved Quality of Tenants
By using AI in your screening process, you will see an improved quality of prospective tenants. You will no longer have to weed through dozens of semi-qualified applicants. AI can help you find exactly what you’re looking for from the very start. AI filters through the applications, finding applicants that match your ideal tenant profile. Whether you want tenants with excellent credit scores, or you prefer tenants who don’t have pets, AI can help you find the right applicant through algorithms. You won’t have to waste your time interviewing prospective tenants who are less qualified.
#2 Reduces Tedious Tasks
As a property owner, chances are, you have better things to do than screening prospective tenants. Between collecting rent, investing in new properties, and understanding the ever-changing landlord-tenant laws, manual tasks such as screening tenants are something you don’t want to add to your to-do list.
Think of AI as your assistant. It can get the essential process of tenant screening done, letting you be completely hands-off. Using automated messaging reduces your need to respond to emails, answer calls, and address questions.
#3 Enhanced Tenant Experience
Property owners want to fill vacancies as quickly as possible. This means providing prospective tenants with a positive experience that will increase the chances of them signing the lease agreement. The overall tenant experience is a core element of the screening process.
With AI by your side, applicants will get answers and information quickly and conveniently. This shows them that the landlord values their time and appreciates their interest in renting the property. If tenants have a pleasant experience, they’ll want to rent the property even more.
#4 Guaranteed ROI for Years to Come
Tenant turnover is always a costly activity. Every time a tenant moves out, you will have to do things all over again. From listing vacancies, launching marketing campaigns, interviewing applicants, and more, you will be investing a lot of time and money in finding the right tenant.
Enhancing your tenant screening process with AI can have a significant impact on your long-term return on investment (ROI). AI helps you put the best tenants in your rental property. By leasing your rental to highly qualified tenants, you will reduce tenant turnover and enjoy years of stable income from tenants who won’t give you a headache!
#5 Reduced Screening Time
As mentioned before, filling vacancies fast is a must for every property owner. Using AI can reduce the time needed to go through applications. AI speeds up the tenant screening process without sacrificing the quality of tenants.
One of the main advantages of AI tenant screening is that it can be done simultaneously with other activities. This is especially useful if you’re managing multiple rental properties on your own. AI can process applications without supervision so that you can focus on other tasks such as doing your property taxes.
Tenant screening is a tedious process, but with advancements in artificial intelligence, it can be streamlined to make life as a landlord much easier. At Luxury Property Care, we use the cutting-edge software called AppFolio Property Manager to effectively find the most suitable tenants. Screening can be done within minutes, allowing us to find and place high-quality tenants in no time.