4 Ways to Avoid Professional Tenants

Nightmares don’t always start out scary. Tracy and her husband recently took out a second mortgage to buy an investment property. The couple hoped that it would help provide for their new baby. After months of renovation, they met a polite and well-dressed young man eager to move in. The tenant told them he needed the apartment immediately because of a family emergency. The easygoing couple was reluctant to sign the lease without a proper background check but they thought “He seemed nice. What could go wrong?”

To their surprise, this seemingly nice tenant had filed for bankruptcy before rushing the couple into signing the lease. After the first month, he stopped paying rent altogether and never answered their calls. The couple couldn’t legally request rent payments while he was still in bankruptcy court. It took them seven months to finally evict the tenant and the apartment was completely trashed. Losing seven months of rent while paying two mortgages devastated the couple’s savings. Tracy painfully learned a new term that gives landlords chills  – professional tenant. 

What is a professional tenant?

Professional tenants are landlords’ worst nightmares. They understand legal loopholes and use them to withhold rent. Not only do they live in your property for free, they often trash the unit when they leave. With protective tenant laws in developed countries, evicting professional tenants is increasingly difficult. An eviction can drag on for months and costs landlords thousands of dollars in legal fees. Thus, avoiding professional tenants should be a priority when you try to rent out your investment properties. 

Professional tenants are hard to spot by appearance. They are great actors and pretend to be nice and agreeable until you sign the lease. Fortunately, there are ways to see through their smokes and mirrors. Using these four strategies can help you avoid professional tenants and protect your rental income. 

Tip No.1 – don’t fall for their sob stories

The most common tactic professional tenants use to fool kind-hearted landlords is to make up “personal tragedies”. They will try to win your sympathy by sharing bogus sob stories such as a bitter divorce or the sudden death of a family member. Their goal is to cloud your judgment and guilt you into signing the lease in a rush without proper checks. 

While helping your fellow man is a good trait, landlords shouldn’t change or skip a rigorous screening process due to the tenants’ personal circumstances. Being a landlord is not a charity. Your priority should be protecting yourself, your family, and your property.

Tip No.2 – verify landlord references carefully

To protect yourself from professional tenants, request as many landlord references as possible. Professional tenants have trouble providing authentic landlord references because they probably have had multiple evictions and dozens of angry landlords. Often, these tenants ask their friends to impersonate landlords during the application. 

Fake landlords are easy to spot when you speak to them on the phone. When you call the landlords, don’t tell them immediately you are checking someone’s references. You can first ask if their properties are for rent. A genuine landlord will naturally give you more information. A fake reference, however, will be confused by the question or stumble through a made-up answer on the spot.

Additionally, you can check the phone numbers and names provided in an online search to see if they match any past rental listings or property records.  If you are too busy to handle all these tasks you might consider hiring a local rental real estate agent so then the agent would take care of all these steps. 

Tip No.3 – run a thorough tenant background check

Verifying landlord references by yourself is helpful but it is not foolproof. Running a thorough tenant background check before signing the lease is an absolute must. Professional tenants fear background checks. That’s why they avoid it at all costs by telling you they need to move in immediately or even offering to pay extra rent upfront. 

However, never skip a proper tenant check. Professional background checks give you an in-depth view of the tenant’s credit score, residential history, and, most importantly, past eviction records. This is the best way to expose professional tenants as they generally have terrible credit scores and histories of evictions. A proper tenant check also helps you identify other unfit applicants by giving you all the information you need to protect yourself.

There are many providers for tenant background checks in the market. In the table below, we compared the background check services from a few providers. Out of the four, SingleKey has the fastest turnaround time of merely five minutes. With the 5-minute reporting time, professional tenants can never rush you into signing a lease without a comprehensive background check! 

Background Check
Provider Singlekey Naborly TVS Equifax
Site singlekey.com naborly.com tenantverification.ca equifax.com
Credit Report (Price) Credit and Background Check together for $24.99 Credit Report = Free / Criminal Check = $25 $16 to $40 depending on the report type selected $23.95 
Subscription Fee $49.95 – one time / not refundable $19.95 per month
Easy to Use Very Easy Tenant Application is
very cumbersome
Somewhat easy Very Easy
Social Media Scan Yes Yes
Who Can Pay Landlord or Tenant Landlord Landlord Landlord
Report Waiting Time 5 mins 90 mins from when
tenant responds
24 hours 24 hours

 

Tip No.4 – get a rent guarantee 

The last tool will save you not only from professional tenants but other causes of non-payment and late payment. With a rent guarantee, you can get 100% protection for your rental income. 

Rent guarantees are a fairly new product. Landlords pay a monthly subscription fee for a guarantee on their rental income. When your tenants refuse to pay rent or fail to pay on time, the company, instead of you, will resolve the problem on your behalf. With a rent guarantee, you will still receive regular rent payments directly from the company even when the tenants fail to pay. Additionally, the rent guarantee service from SingleKey even covers ALL your legal expenses during an eviction and up to $10,000 for property damage. Having a rent guarantee offers the best protection on your rental investment and makes your passive income truly passive! 

Protection is Key! 

Professional tenants are landlord’s worst nightmares. Loss of rental income, trashed properties, and the legal troubles can really put a strain on you and your family. When it comes to investment properties, protection is key. Don’t be penny wise and pound foolish. With tools such as tenant background check and rent guarantee, you can avoid the headache and financial losses of dealing with professional tenants and protect your rental income in the long run.

David Jackson

David is a personal finance expert, a professional male model, and an entertainment writer.