As you secure tenants for your South Florida rental property, you’ll go through a long list of potential tenants. Unfortunately, not all of them will be good tenants. Some tenants will be unable to pay their rent on time, be rude toward their neighbors, and so on. Remember that if you end up with problematic tenants, you’ll have to deal with costly and time-consuming eviction procedures down the road. That’s why you must choose your tenants wisely, be meticulous, and be able to weed out the bad ones.
In this post, we’ve put together a few warning signs of tenants you shouldn’t rent to. Note that red flags don’t always stare you straight in the face, so you’ll have to count on common sense for the most part.
Red Flag #1: Tenant Doesn’t Have Sufficient Income
You must ask your tenant for proof of their employment. After all, if your potential tenant doesn’t come home with a reasonable monthly paycheck, how will they be able to make their monthly payments? Check if they can continually afford the rent and any additional fees. Ideally, your tenant should earn around 2.5 to 3 times the monthly rent. For instance, if your rental rate is $2,000, your tenant should be making about $6,900 to $9,000 a month.
There are, however, some exceptions. For example, a student may not make a significant amount of money, but they may be able to pay their rent through a co-signer such as a parent. If you’ll be renting to student tenants, be sure to partner with a Florida property management company to guide you through the intricacies of a co-signer lease.
Red Flag #2: Tenant Is Unemployed
What’s worse than low income? No income. If potential tenants tell you they’re “in between jobs” or share their sob stories with you, be wary. We understand that you may want to help, but remember that your rental is practically a business you must protect. Renting to an unemployed person is not a good idea.
Red Flag #3: Tenant Tends to Jump From One Job to Another
There’s a reason why professional property management firms look into potential tenants’ employment: to make sure the tenant has a steady source of income. The habit of jumping from job to job shows that the tenant probably won’t be able to stay in their current job. Due to the unpredictability of their work, there will likely come a time when they won’t be able to pay their rent. Plus, it’s a relocation risk – as a rental property owner, it’s in your best interest to rent to tenants who’ll be around for a while. If your tenant must move due to their new job, you’ll have to go through the time-consuming and complicated process of tenant screening again.
Red Flag #4: Tenants Have a Poor Credit Score
By far, the main predictor of a problematic tenant is their credit score. A bad credit score shows that the tenant hasn’t been able to pay their debts in the past. This means they probably won’t be able to pay you on time. So if you spot a weak FICO credit score (lower than 650), run fast and run far.
To check your potential tenant’s credit score, you can request credit reporting agencies (Equifax, Experian, and TransUnion) to run a credit report. Do note that you may be asked to pay a minimal fee to run the credit report (fortunately, you can ask your potential tenants to cover the cost).
If you have a vast pool of prospective tenants, it’s a good idea to run a credit check only on the real contenders. In other words, don’t waste your money on candidates you know you won’t choose. A property management firm in Florida can pre-screen your candidates and narrow down your tenant pool.
Red Flag #5: Tenant Has a Prior Eviction
Now, this is a red flag that’s staring you straight in the face! Landlords do not evict tenants for no reason, so if you see that your tenant was evicted by their old landlord, do not rent to them. Whether it was due to non-payment of rent, improper use of the property (e.g. using it as a commercial space), or other reasons, it’s a bad idea to have a rule-breaker on your property!
Red Flag #6: Tenant Wants to Move in Immediately
Does your tenant want to move in immediately? Do they seem too eager to sign the lease agreement? If your answers are yes, it’s worth wondering why. When a tenant wants to move in ASAP, it’s typically a sign that they no longer have a place to live. Chances are, they couldn’t pay their rent in their previous rental. While there are legitimate reasons for wanting to move in immediately (e.g. they just moved into town for work), it’s still a warning sign you shouldn’t ignore.
Red Flag #7: Tenant Has Many Comments About the Property
Tenants often forget that they’re only tenants. Some of them act as if they own the property. So, when a potential tenant walks into your showing and seems dissatisfied with the property, don’t rent to them. High-maintenance tenants aren’t a good idea. If you do, you’ll end up bending to their demands down the road.
Red Flag #8: Tenant Lied in Their Application
You must confirm if the information in each application is correct. If you find that the tenant provided false information, such as false employment, false income, and false references, you can’t trust them. Tenants who have no reason to lie won’t lie. If they lie to you from the start, they’ll surely lie to you later on. It’s worth partnering with a Florida property management firm to find inconsistencies in tenant applications.
Find Quality Tenants Through Luxury Property Care
Watch out for these red flags to guarantee you rent only to good, long-term tenants. And remember, if you ever have a hard time identifying the red flags, you can count on us. When you partner with Luxury Property Care, you can let our experts select your tenants for you. With our count on our tried-and-tested screening process, we’ll make sure to choose tenants who won’t cause you catastrophic losses.