What Is Rental Verification and Do Landlords Need to Do It?

As a landlord, you're always looking for the most reliable tenants. Rental history verification is an essential element of the tenant screening process and can help you make informed decisions about prospective renters. 

Without verifying an applicant's rental history, landlords risk unknowingly renting to someone with a history of evading the monthly rent payments due or criminal activity.

In this article, we'll explore rental verification in depth, including what it is, what you can learn from verifying rental history, and how it fits into the overall tenant screening process. Plus, you can download a rental verification form!

What Is Rental Verification and Why Does It Matter?

While it’s not the same as a background check, rental verification is a critical step in the tenant screening process that allows landlords to confirm a prospective tenant's rental history. 

In the real estate business, the term “rental history” refers to an applicant's past tenancies, including the names of previous landlords and the duration of each stay. It also uncovers issues that may have arisen during their tenancy, such as late rent payments, lease violations, or damage to the rental property.

Understanding a potential tenant's rental history is crucial in determining the likelihood that they will be reliable and responsible tenants. By confirming an applicant's rental history through the rental verification process, you can better protect yourself from potential problems and find reliable tenants who will take good care of your property.

How the Rental Verification Process Works

There are five main steps to follow in the rental verification process:

1. Request permission: Obtaining consent is essential before contacting the prospective applicant’s previous landlords. Ask them to sign a release on the rental application form authorizing you to contact their former landlords.

2. Contact previous landlords: Once you have permission, contact the prospective tenant’s previous landlords and request information about their past tenancy, including how long they lived there and any issues that may have arisen. 

3. Verify the information: Confirm the information provided by the applicant by contacting multiple references if possible. Doing so helps ensure you get a big-picture view of the applicant's rental history.

4. Evaluate and compare: After gathering all the necessary information, evaluate and compare each potential tenant to your other applicants to find the best fit.

5. Make an informed decision: Armed with this information, you can decide whether to approve the tenant. Be sure to follow fair housing rules by evaluating each applicant equally and fairly.

What You Can Learn by Verifying a Tenant’s Rental History

Reviewing the rental history of each prospective tenant provides numerous benefits and helps mitigate potential risks. Here are some key points to consider.

Benefits of Verifying Rental History

• Verify their identity: The process allows you to fact-check and ensure applicants have been truthful on their applications.

• Evaluate past behavior: By contacting previous landlords, you can gain insight into the applicant's past behavior as a tenant. Doing so can help you evaluate whether the applicant will likely be a responsible tenant.

• Identify potential issues: If an applicant has a history of late rent payments or damage to previous properties, you may choose to consider other prospects.

• Avoid legal issues: By verifying a prospective tenant’s rental history, you can avoid potential legal issues. If an applicant has a history of eviction or other legal disputes with previous landlords, the same situation could occur with you.

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Risks of Not Verifying Rental History

• Poor tenant selection: Without proper screening measures in place, there is a risk that you will select tenants who are not suited to your property or who have exhibited problematic behavior in the past.

• Financial losses: Not verifying rental history could result in financial losses due to unpaid rent or destruction caused by tenants.

• Reputation damage: Renting to unsuitable tenants can lead to potentially negative reviews online, making it harder to attract future responsible tenants.

Questions to Include on a Rental Verification Form (+ Download)

Landlords need to have a comprehensive rental verification form. It should include questions that offer insight into the applicant's behavior as a tenant, their financial stability, and any potential red flags indicating problematic behavior.

Here are some questions that landlords may wish to include on their rental verification form:

1. When did the tenant's lease begin and end?
2. Did the tenant pay rent on time?
3. Can you verify if the tenant had pets or roommates?
4. Did the tenant cause any damage to the property during their tenancy?
5. Did the tenant receive any noise complaints or violate any lease terms?
6. Were there any communication or conflict resolution issues between you and the tenant during their tenancy?
7. Did you ever serve an eviction notice during their tenancy? If so, why?
8. Did the tenant give proper notice before moving out of your property?
9. Would you rent to this tenant again in the future?
10. Is there anything else we should know about this tenant as a potential renter?

Asking open-ended questions that a person can't answer with a simple “yes” or “no” are helpful, especially if you are speaking to a tenant's landlord references in person. They allow the previous landlord to provide any additional information the other questions may not have covered.

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