Determining if you’re getting the most accurate and complete background screening information is essential when avoiding bad tenants. While price point will always factor into your decision, ultimately you want your tenant screening to be reliable. As your first defense against negligent rental payments, property damages, and even criminal activity, knowing what qualities generate good screening reports is vital.
Criminal Checks are not always the same
You use the information on your applicant’s criminal background check to make informed rental decisions all the time (and if you don’t currently receive criminal data, you should), but what makes that information dependable? Above all, you want to know how in-depth the screening company goes into collecting the criminal information. For example, the criminal information on your reports should be taken from databases nationwide (all 50 states plus Washington D.C.). It should account for jail and prison records, check for wants and warrants, and make sure your applicant isn’t on the terrorist watch list (also known as OFAC). For the safety of your multifamily community you should also be looking for whether an applicant is a registered sex offender, and how severe their crimes may have been.
Sergey Umrikhin, a landlord in Miami, learned the hard way when he unknowingly accepted new tenants that were wanted by the international police agency, Interpol. According to the Miami Herald, the background screening report failed to pick up on this, stating a green highlighted “All Clear. No criminal or eviction history found” on the report. In addition to choosing a background screening company that checks nationwide criminal databases, be aware of the other databases are being used to screen your applicants. Consider using a screening company, like ApplyConnect®, to scan your future tenants through OFAC, Interpol, and your state’s Dept. of Justice sex offender registry.
Not All Credit Scores Are the Same
When it comes to finding a trustworthy background screening company, you’re going to want to pay attention to what scoring model they use. Unfortunately there is a plethora of dubious credit scoring models that differ on how they analyze credit data and what their scoring formula is. Non-standard screening models not only provide inconsistent scoring information, but they can possibly skew the score to fit that company’s interests. Confirm that your background screening company is utilizing a verified and regulated screening model like the VantageScore 3.0. You can read up on the differences of both in our article Which Credit Risk Score Model is Right for Your Rental Screening?
Identity Red Flags Such as Information Inconsistencies
Ultimately, your tenant’s screening report is only effective when your applicant’s identity matches up with the person on the report. While this might be fundamental, there’s always a chance your applicant might be falsifying their personal information. When comparing background screening companies, double check that the basic information on their application (like name, date of birth, and previous addresses) match up with the applicant’s background screening report. On the flip side, there’s always a chance that your applicant might be using another person’s identity to apply for your property.
In addition to checking to see what criminal databases your applicants are being scanned through, verifying that a standard credit scoring model is being used, and making sure that the information on the report matches, your screening company should be pulling eviction history from a large (and FCRA compliant) database. This will make your applicant’s background report more accurate, enable you to make informed rental decisions, protect your property from potential bad tenants, and ultimately it can significantly reduce your liabilities.
Learn whether you are missing any key information on your applicant’s reports by contacting ApplyConnect®!
How did you determine what background screening company to go with? How did you ensure that their applicant information was reliable? Let us know your experiences in the comments section below, and be sure to subscribe!