Dallas-Fort Worth Real Estate Investor Club

Tenant Screening

  • 19 Jan 2024 12:26 PM
    Message # 13303353

    I'd like to hear opinions/practices about how much weight you put on an applicant's credit history and credit score when deciding whether to rent to them.

    I've always been of the opinion that a large amount of unpaid debt likely indicates someone who's a bad money manager whether intentionally or not and therefore not a good risk. They can be the "nicest" person, but even nice people can be fiscally irresponsible.

    Thanks for your thoughts.

  • 20 Jan 2024 8:03 AM
    Reply # 13303607 on 13303353

    I do tenant screening and I use the factual information from the reports to make decisions.  I do not use emotional feelings about the tenant to guide me.  A business needs to be run on facts and data.  Emotions do not have a place in business decisions.

  • 20 Jan 2024 10:19 AM
    Reply # 13303640 on 13303353

    Neil.  I agree.  

    I mentioned "niceness" because my leasing agent said one particular applicant is a "very nice lady and would make me a good tenant." I, like you, do not put much weight on "niceness"--I've made that mistake before, also under pressure from a leasing agent. As far as I'm concerned, agents' opinions don't carry any weight. It's not their property, their business, or their money. Hope that clarifies. 

    So what is your answer to the question? Do the "facts" of someone's credit history influence your decision to rent to them?

    Thanks, Paula

    Last modified: 20 Jan 2024 10:23 AM | Paula Robertson
  • 20 Jan 2024 8:07 PM
    Reply # 13303779 on 13303353
    Robin Carriger (Administrator)

    A potential tenant's credit score most definitely is an important consideration in the screening process.

  • 20 Jan 2024 10:02 PM
    Reply # 13303792 on 13303353

    Yes, it is extremally important. You don't want to be the next person that they are not paying.

    I also use it to determine if additional deposit is needed as well if they will be required to pay more than last month.

  • 21 Jan 2024 12:41 AM
    Reply # 13303805 on 13303353

    The Texas Property Code requires all landlords to have written screening criteria for prospective applicants.  If a landlord fails to provide a written statement of their screening criteria they MUST refund the application fees. 

    All landlords should familiarize themselves the the TPC requirements as well as what criteria can be used. Written criteria will help applicants determine beforehand if they may meet the requirements and will potentially protect landlords from unlawful discrimination complaints and lawsuits. You can't be a professional landlord running your business afoul of the law!

  • 21 Jan 2024 9:42 AM
    Reply # 13303845 on 13303353

    Thanks to those of you who answered the question.

    My rental criteria includes: Credit history must reflect no more than 25% of the total accounts reported to be 90 days past due or charged to collection in the past two years. Or proof of a minimum score of 600 is required.

    Anyway, I rejected this person's application yesterday. There were other red flags too.

  • 21 Jan 2024 11:16 AM
    Reply # 13303868 on 13303845
    Paula Robertson wrote:

    Credit history must reflect no more than 25% of the total accounts reported to be 90 days past due or charged to collection in the past two years

    It seems you are more generous than I am.  I will not rent to a person who is currently past due on anything.  And, I will probably not rent to them if they had anything go to collections in the past two years.
  • 22 Jan 2024 12:41 PM
    Reply # 13304319 on 13303353

    Yeah, I confess that I don't really follow that, because it's too hard to do the math. I pulled that statement from a TREC form years ago.  Time to update.


  • 13 Jun 2024 7:17 AM
    Reply # 13369716 on 13303353

    It is very important. Once they miss payments it is hard to get caught up and you will loose months of income evicting and the cost for make ready.  We own apartments and during Covid the people that had good credit found a way to make payments or wanted to negotiate. We made the mistake years ago being too nice and believing peoples sad stories and it cost us a lot of money.  There are professional renters that always have excuses and will take advantage of you. 

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