Wisconsin Steps Up to Make Tenant Screening Easier

Tenant screening is a critical step toward a landlord’s successful relationship with a tenant. Recognizing this, the Wisconsin legislature is making it easier for tenant screening information to make into the hands of landlords who need it most.

In the past, local ordinances and laws have made it difficult for landlords to have access to important information regarding a tenant’s previous rental history, credit information, criminal history and other details. But a new statewide law makes it illegal for any city, town, village or county to enforce such ordinances that keep necessary tenant screening information under cover.

The law makes it clear that landlords are free to obtain and use any of the following information with respect to a tenant or prospective tenant: Monthly household income; employment information; rental history; credit report; court records related to criminal history, including arrest and conviction records, to which there is public access; and identifying information such as a Social Security number.

Those in the Wisconsin legislature clearly understand that landlords are not trying to violate a person’s privacy rights by obtaining this information. On the contrary, they’re just trying to protect their own assets and make the most intelligent decision for their business interests (without unlawfully discriminating against anyone, of course). Hopefully more states will follow suit.

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Ignoring Necessary Repairs Could Lead to Injury and Liability

A New Haven, CT, landlord was arrested recently after one of her tenants fell off a second-story porch when a railing broke. According to an Associated Press story, the landlord had failed to address 28 code violations that were brought to her attention during inspections at the three-family home she owned in 2009. The tenant was seriously injured in the fall.

Such a story is tragic and completely preventable. The failure to fix problems that were two years old amounts to negligence on the part of the landlord. A landlord’s duties go far beyond tenant screening for qualified renters and collecting monthly rental payments. A landlord is responsible for property maintenance so that it remains not just an aesthetically appealing home but a safe one as well. Necessary repairs should be made promptly upon hearing about anything that is broken or has not been properly maintained.

To make this an easy part of the job, the landlord should stay in frequent contact with the tenant, taking complaints seriously and asking frequently whether everything in the home is in good working condition. And to avoid liability and other legal trouble, the landlord should always promptly address any issues that arise, either through the tenant or through the various codes and other rules governing properties in the area.

No decent landlord wants to be on the wrong side of the law or cause harm to a tenant. Common sense and a good handyman on call can help landlords avoid such tragedy.

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Meth Lab Cleanup Is a Cost You Don’t Want to Incur

Methamphetamine is a problem that can destroy lives, bank accounts and families in a very short amount of time. But homemade meth labs are also highly damaging to residential properties. The ingredients used in the manufacturing of meth, when combined, create toxic contaminants that are absorbed into walls, flooring, and ventilation systems.

Once a meth lab is discovered and the residents are arrested, the problem of how to clean up the property falls to the property owner. Cleaning up the toxic contaminants left behind can be a lengthy and expensive process. After a typical meth lab bust, once the police have removed the chemicals and equipment, the local health department writes a condemnation order and orders the property owner to clean up the area. That can cost upwards of $30,000, an expense that is compounded by the owner’s inability to get rental payments out of the property for the month(s) it is uninhabitable due to the cleaning process.

Because the liability is so great when it comes to meth labs, every property owner should be diligent about conducting thorough background checks for all prospective tenants. Look for a history of issues related to substance abuse, check the tenant’s criminal record, and speak with former landlords about the tenant to get landlord references. Remember, screening residents is the first line of defense.

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Use Same Standards During Each Tenant Screening Process

Selecting a tenant isn’t rocket science, but it can be a complicated, confusing process if you don’t have a set plan in place. Every landlord should have a set list of standards that any prospective tenant must meet in order to be approved to sign the lease and move in. Those standards may differ from landlord to landlord, based on personal preferences, the type of rental unit, and past experiences with tenants. Here are some recommended standards for approving a tenant application:

• The application itself is properly completed.

• The prospective tenant is 18 or older.

• The prospective tenant must prove a monthly income that is three times the amount of the monthly rent.

• There can be no previous evictions on the tenant’s record.

• The tenant has a clean criminal record.

• The tenant’s credit score must be at least XXX.

• The tenant must be currently employed, and undergo a successful employment verification process.

• The tenant’s previous landlord must give a positive recommendation.

Whatever a landlord decides his standards for application approval are, those standards should be written down and checked (twice!) during each tenant screening process for every single applicant. That’s because in the rush to find a tenant — amid the sea of paperwork and reports and the business of collecting fees and applications — it’s easy to overlook a standard or two. It’s easy to forget that you were supposed to call their previous landlord or their current employer. So write down your list of standards and keep it on file to adhere to each and every time.

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Renting During a Recession Means Making Concessions

Every landlord hopes for a dream tenant to walk through the door, someone who’s friendly and clean with excellent credit, solid employment, good references and no criminal record. While these tenants do exist, it’s getting harder to find renters with spotless credit reports and an unblemished employment history. These last few years of layoffs and pay cuts have wreaked havoc on families across the country, and plenty of upstanding citizens, many who’ve owned their own home before, are facing hard times.

Landlords can’t become bleeding hearts, opening their doors to every victim of the recession. It’s still important to do a thorough tenant screening on applicants and think long and hard about the risks associated with allowing someone to sign a lease. But if the potential tenants you’ve been screening have lower credit scores than what you’re used to accepting, consider a few things:

1. Don’t make a foreclosure a deal breaker. The number of people who have a mortgage in foreclosure or mortgage payments significantly past due is rising. While those people couldn’t hang onto their homes, they more than likely are good prospects for renting because they’re used to caring for and maintaining a home, and they’re determined to improve their financial situation, which means they’ll pay their rent on time.
2. Reduce the security deposit but make it nonrefundable. Reducing the security deposit gives a break to those who will probably be good tenants but don’t have a lot of cash lying around to drop all at once. And making the security deposit non-refundable helps alleviate some of your risk in renting to someone with a lower credit rating.

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Try Partnering With Tenant to Make Eco-friendly Changes

Have your heard about how Internet giant Google is partnering with its landlord, McKinley Inc., to make several eco-friendly renovations to the building it leases in Ann Arbor, Mich.? According to reports, they’re also collaborating to build a huge outdoor rooftop deck, among other things. Representatives for McKinley, which is based in Ann Arbor, say they hope the partnership can stand as an example of what can be done between landlords and tenants to adopt renewable energy technology to enhance the workplace.

It’s an idea that makes sense from a business perspective and an environmental perspective, and it’s one that can be translated on a simpler level to smaller businesses and even residential buildings as well. If you’ve thought about making sustainable changes to your properties, why not talk to your tenant about them and see if splitting the cost is an option. The tenant has a right to refuse, of course, but if they see themselves staying put for the long term, they might jump at the chance to make a few changes that could substantially cut their utility bills and help the environment as well.

Even if tenants don’t go for such a partnership, it’s a good idea to make a list of what changes you could make to your property that would enhance its sustainability and save tenants — and you — money in the long run. Then methodically knock things off your list, starting with the least expensive and moving up toward the bigger projects. Eco-friendly changes will give your property great appeal to future tenants, and could make you eligible for special tax credits as well.

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Not everybody wants a one-year lease

A yearlong lease is a pretty standard length of time for a rental property that is a tenant’s primary residence. But sometimes a tenant will ask to do a longer lease or a shorter lease. Landlords should consider the pros and cons to both when deciding whether to grant a special request for the least term. First and foremost, perform a thorough background check, credit report and rental history on the applicant as part of the tenant screening process. This will give you a clear indication of what type of lease will suit both of you best.

Two-year lease. If a tenant applicant requests a lease term that is longer than the standard one-year lease, and they have excellent credit, references and employment history, don’t be scared to sign them up for the long haul. Not all tenants wish to be nomads, moving every year to a different place. Sometimes really qualified, respectful renters just want the stability of knowing they can stay put for awhile in a home they love. If you find these folks, count your blessings.

Six-month lease. If a tenant wants a six-month lease and they pass the tenant screening process with flying colors, talk to them about the reasons behind the shorter lease. Will they be going on an extended trip? Will they be moving for their job, or getting married? Are they in the military and might be deployed or transferred to a different base? Get to the bottom of the half-year request, and if you feel comfortable with possibly having to find new tenants twice in one year, go for it.

Month-to-month lease. If you find a tenant who is interested in a month-to-month lease, beware — especially if they don’t have a good credit score or employment history. However, if you just want someone in the property for as long as you both can make the situation work, it might be worth it. The benefit is you can easily kick out the tenant at the end of the month if they aren’t paying rent. And if they do pay the rent on time, then you bought yourselves one more month of a mutually beneficial arrangement.

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