In this guide
Understand the Legal Landscape
Before you start screening, familiarize yourself with the Fair Housing Act and your local landlord-tenant laws. The Fair Housing Act prohibits discrimination based on race, color, national origin, religion, sex, familial status, or disability. Many states and cities add protections for sexual orientation, gender identity, source of income, and other categories. Violating these laws can lead to costly lawsuits, so it's essential to apply your criteria consistently to every applicant.
Also, know what you can and cannot ask in an application. You can ask about income, rental history, credit history, and criminal background (subject to state restrictions), but you cannot ask about protected characteristics or request documents that reveal them (e.g., a birth certificate). Some states restrict how you can use criminal records; for example, you may need to consider the nature and age of the offense and whether it relates to tenancy.
To stay compliant, create a written screening policy that outlines your criteria (e.g., minimum credit score, income-to-rent ratio, rental history requirements). Apply this policy uniformly to every applicant. Keep records of all applications and your decisions to demonstrate that you followed a non-discriminatory process.
- Review the Fair Housing Act and your state's fair housing laws before screening.
- Create a written, objective screening policy and apply it consistently.
- Avoid questions about protected classes or that could be seen as discriminatory.
- Keep records of all applications and screening results for at least three years.
Create a Comprehensive Rental Application
A detailed rental application is your first line of defense. It should collect enough information to verify the applicant's identity, income, rental history, and background. Use a standardized form that includes the applicant's full name, date of birth (for background checks), current address, phone number, email, Social Security number (for credit checks), employer and income details, and references.
Also request consent for credit, criminal, and eviction checks. Without written consent, you cannot legally pull a credit report or run a background check. Make sure the application clearly states that you will obtain these reports and that the applicant authorizes you to do so.
Consider collecting an application fee to cover the cost of screening. Check your state's laws regarding application fees—some states limit the amount or require that they be reasonable and non-refundable. Be transparent about the fee and provide a receipt.
- Use a standardized application form that captures all essential details.
- Include a consent clause for credit, criminal, and eviction checks.
- Charge a reasonable application fee if allowed by state law.
- Ensure the application includes references from previous landlords and employers.
Verify Income and Employment
Verify that the applicant has a stable, sufficient income to pay rent. A common rule of thumb is that the monthly gross income should be at least three times the rent, but you can set your own threshold. Ask for recent pay stubs (last 2-3 months), tax returns or W-2s if self-employed, and bank statements to corroborate income.
Contact the applicant's employer to confirm employment status and income. You can call the human resources department or the applicant's supervisor (with the applicant's permission). Some employers have policies about providing references, so be prepared to accept alternative verification like an employment verification letter.
If the applicant has a non-traditional income (e.g., gig work, child support, disability), ask for documentation such as bank statements or award letters. Be careful not to discriminate against applicants who receive government assistance—some states prohibit discrimination based on source of income.
- Require proof of income: pay stubs, tax returns, or bank statements.
- Verify employment by calling the employer or requesting a letter.
- Set a consistent income-to-rent ratio (e.g., 3x rent) and apply it to all applicants.
- Consider alternative income sources with proper documentation.
Check Rental History and References
A strong rental history is a good predictor of future behavior. Contact every previous landlord listed on the application. Ask about the applicant's payment history, whether they paid on time, if they caused any damage, and whether they received any complaints. Also ask if they would rent to the applicant again.
Be cautious if the applicant is a first-time renter or has gaps in rental history. In such cases, you might request a larger security deposit or a co-signer. However, ensure that any requirements are applied consistently to all applicants in similar situations.
Also check references from employers and personal contacts. While these are less reliable, they can provide insight into the applicant's character and responsibility. Ask about their reliability and whether they would trust the applicant with their own property.
- Contact previous landlords to verify rental history and payment behavior.
- Ask specific questions: late payments, damages, complaints, evictions.
- Consider a co-signer for applicants with limited rental history.
- Check personal references for character and reliability.
Run Credit and Background Checks
A credit report reveals an applicant's financial responsibility and can indicate potential risks. Look at the credit score, outstanding debts, payment history, and any collections or bankruptcies. A low credit score may suggest a higher risk of late payments, but it's not always a deal-breaker—consider the overall picture.
Background checks should include a criminal history search and an eviction records search. Use a reputable screening service that complies with the Fair Credit Reporting Act (FCRA). You must obtain the applicant's written consent before running these checks, and if you deny the application based on the report, you must provide an adverse action notice with the name and contact of the reporting agency.
Be aware that some states have 'ban the box' laws that restrict when you can ask about criminal history. In some jurisdictions, you can only consider convictions that are directly related to the tenancy, and you may need to conduct an individualized assessment. Always follow state and local rules.
- Obtain written consent before pulling credit and background reports.
- Use a FCRA-compliant screening service for accuracy and compliance.
- Review credit reports for payment history, debts, and red flags.
- Check for evictions and criminal history, but comply with state restrictions.
- If you deny based on a report, provide an adverse action notice.
Interview and Select the Best Applicant
After you've verified the key facts, you can interview the applicant in person or via video call. This is your chance to gauge their communication skills, attitude, and whether they seem responsible. Ask open-ended questions about why they're moving, how they plan to care for the property, and whether they have any concerns.
Trust your instincts but rely on objective criteria. Create a scoring system based on your screening policy (e.g., income, credit score, rental history, references) and rank applicants. This helps you make a fair decision and document why you chose one applicant over another.
Once you've selected a tenant, move quickly to sign the lease and collect the security deposit. Before signing, review the lease agreement with the tenant, clarify any questions, and ensure they understand the terms. A clear lease agreement is your best protection.
- Conduct a face-to-face interview to assess the applicant's reliability.
- Use a scoring system to compare applicants objectively.
- Document your selection reasons to avoid discrimination claims.
- Move quickly to sign the lease and collect the security deposit once approved.