6 Rental Application Mistakes to Avoid At All Costs

Rental application errors may severely harm your rental business. Crucial information is contained in the application regarding the tenant’s income, employment information, previous landlord, criminal records, etc. For a landlord, the rental application is the first document to screen. So, you should not make mistakes in screening the rental application form. This can save you from evicting a bad tenant, and at the same time, it saves your money and property. In this article, read about 6 Rental Application Mistakes to Avoid At All Costs

Top 6 Rental Application Mistakes to Avoid At All Costs

Why is the rental application process so important?

The first step of assessment in the rental application process is to check whether the particular tenant is a suitable choice or not. It can be done by determining their ability to pay the rent office Space, checking their bank statement, and credit score, verifying their employment details, and also getting a reference from their previous landlord.
This application process screening usually takes 5-7 days.

Rental Application Mistakes That Should Avoid

To make the rental application screening process faster, you must not take any haste decisions. None of us can foresee the future, so it is difficult for a landlord to foresee if a particular tenant can cause certain issues in the coming days. However, a rental application gives landlords insights into the rental history of prospective tenants. Missing out on a particular factor may cause the landlord dearly.

Following are six rental application mistakes that you should avoid

Apart from making a haste decision during renting a property, there are many other mistakes that you should avoid.

1. Discriminatory Rental Application

Fair Housing Act is known to most landlords and tenants. It is illegal if landlords refuse any prospective tenant to rent the property based on gender, religion, color, race, age, familial status, or disability. So, landlords must be extra careful while designing their rental application forms. The rental form must not have any illegal clauses or questions, such as:

● What is your religion?
● Are you planning to have children?
● Which is your home country?

Landlords can discriminate the prospective tenants based on pets or smoking. Landlords can do criminal background checks for their prospective tenants, but they cannot ask the questions if they have ever been arrested or not. Arresting a person does not mean the person is guilty.

2. No rental application denial should be discriminatory

If you do not rent a tenant depending on their income references and credit reports, that should not be a mistake or discrimination because, in that case, you are thinking about your safety. Like if someone’s income is not good enough, it is obvious that he cannot make the payment properly.
But at the same, you can not disqualify someone for your personal whim. When a landlord rejects the application form of a tenant, it must be done based on legal points and not on any discrimination.
For example, if a couple is in a live-in relationship, you cannot reject them because they are not married. Or you cannot reject them because they have a tattoo on their full body or for any political reason etc. Also, you cannot reject a person because he is arrested for a very minimal reason. Read more about investment property loans.

3. Terms for Eviction, Lock-in and Termination are important

Clear communication between the tenant and the landlord can avoid many problems, and this communication should be there from the very beginning. In the rental application, landlords should provide clear terms for lock-in, eviction, and agreement termination. While going through the rental application form, the tenants must get a clear idea about the following:
● The minimum time period that the tenant should stay in the house.
● When is the termination of the agreement possible?
● What is the notice period for terminating the rental agreement?
● What are the conditions that can lead to the eviction of tenants? For example, non-payment of rent for 2-3 months, illegal activities in the rental properties, etc.
Your tenants should give a notice period before vacating the property so that you can utilize this time period to search for a suitable tenant for your property, and you do not lose out on the rent. If you get a notice, you can also be prepared beforehand to pay the security money to your tenant.
Ask the prospective tenant to go through all these terms properly and then sign the agreement if the terms are acceptable.

4. Do not forget to charge for the security deposits

First, make it clear that the security deposit and application deposit are not the same. Security deposit is for potential damages that your tenant makes by leaving before the termination time or for any huge damage that the tenant may make to your property. On the other hand application deposit is a lump of money that a landlord or property manager wants a tenant to pay while submitting a rental application form.
So do not forget to mention the security deposit in the application form. Ignoring the state law of security deposit can be a costly mistake for you. On the other hand, you cannot charge too much for the security deposit. It is always 2-3 months’ rent that you take as a security deposit. Rent Control Law always regulates this money of how much you can collect and when to return it.

5. Set the appropriate rental rate

Setting inappropriate rental rates is also a costly mistake that landlords should avoid. Setting the rental rate too high means a few prospective tenants will get attracted. On the other hand, if the rental charge is too low, the landlords cannot make a profit by renting the property. Low rental charges mean the landlord cannot maintain the property, pay mortgage payments, or incur unexpected costs. The rental charge always depends on the accommodation you provide and the facilities available in the neighboring area provide to keep life easy.
For example, the rates always go high if there is any public transportation option, marketplace, school or hospital close to the rent a house.
So, keep in notice all these things before charging.

6. Refuse to accept an incomplete or illegible rental application

Landlords should not accept an incomplete rental application. If there are spelling mistakes or certain information are illegible, it is better not to ignore them and accept the application. Such minor issues may create problems in the future. Incomplete and illegible information can make the rental application screening process difficult. If important information such as the tenant’s phone number, social security number, or previous landlord’s phone number remains illegible, it becomes difficult to check the tenant’s creditability.
You can also download the property management app on your phone or request your tenants to provide information by filling out application forms digitally. Thus, through the help of this digitalization, everything can be submitted properly and the chances of mistakes can be avoided.

Conclusion

By not making any mistakes in the screening of the rental application forms, you can avoid eviction, as it is challenging, tiresome, and costly. Renting property is a good business when you follow all of the guidelines. If proper screening of tenants is not done, there is always a possibility that the tenant may occupy the property illegally, make delayed payments, and may refuse to pay the rent. In this article, we learnt about the six rental application mistakes to avoid.