If you rent out a residential or commercial property, finding the right tenants is essential for protecting your investment. A good renter will follow the terms of the lease, which includes making on-time payments and taking care of the space. If you're unsure how to go about finding such tenants, start by taking the following steps.

How to Screen Potential Tenants

1. Request a Completed Application

You can learn a lot about prospective tenants by reviewing their applications, as long as the document is comprehensive. Make sure the form you have hopeful renters fill out asks about their employment history, current income, family dynamic, and lifestyle. You should also request personal and professional references, as well as the contact information of their prior landlords.

2. Run a Credit Check

A comprehensive credit check will reveal the applicant's financial history. Look for any red flags that might indicate they'll have a hard time making rent every month. Examples include maxed out credit cards, collection accounts, bankruptcy filings, and past-due payments. If you want the applicant to pay for the credit check, keep local laws in mind. For example, in New York, landlords can't charge more than $20 for credit and background checks.

3. Perform a Background Check

You deserve to know the criminal history of those who will be renting out your residential or commercial property. While you shouldn't reject an application solely for having a criminal record, review the circumstances surrounding any convictions to determine if the individual may put you or other tenants at risk. A background check will also reveal past evictions and public records, which refer to ongoing legal battles.

If you don’t want to deal with the hassle of screening tenants, a third-party property management company can help. MetroHudsonMgmt LLC. has been serving residential and commercial property owners throughout New York City and Putnam and Westchester counties for more than 25 years. Their team is comprised of registered apartment managers, licensed real estate brokers, and accredited realty managers. To discuss your needs, visit their website or call (914) 941-7111.