Documents To Request from Prospective Tenants

1. Rental application

To approve an applicant, you need them to fill out a rental application. The rental application should capture necessary information like their complete name, email address, phone number, and other contact details. It should also include sections to list their residence history, employment and income, and references.

2. Identification documents

In 2023,93.3% of apartment owners, developers, and managers stated they encountered fraud in rental applications. Some of the most common types of fraud include fake or manipulated identities (58%), misrepresenting income (57%), and identity theft (53%).

The best way to combat this fraud is by requiring each prospective tenant to submit official identification. A government-issued ID such as a driver's license, passport, or Social Security card is sufficient. Any or all of these documents combined can verify their identity to confirm their legal status and that the applicants are who they claim to be.

3. Background check information

Running a comprehensive background check gives you a clear picture of an applicant’s rental history, creditworthiness, criminal record, and overall reliability as a tenant. Per the Fair Credit Reporting Act (FCRA), you must obtain written consent from applicants beforehand. It’s also good practice to provide applicants with disclosures about the background check process and how you’ll use the information to make a decision.

4. Proof of income

One of the most important things to ask potential tenants for is proof of income. Before you accept an applicant, you need to know if they can afford the rent and make timely payments.

To assess their financial status, request documents like:

• Pay stubs
• W-2 tax forms
• W-4 forms
• Bank statements
• Court-ordered settlements
• Employment contracts
• Social Security benefits statement

Pay stubs and bank statements are the most common proof of income documents. Ask for at least a month of pay stubs and several months of statements. This information offers the best view into whether their income is stable. It can help you calculate their rent-to-income ratio, a crucial metric in determining how much of their income would go toward rent. In most cases, you’re looking for 30% or less.

Additionally, consider contacting the applicant’s employer to confirm the accuracy of the application information.

5. Credit report

In addition to proof of income, a credit report allows you to gauge the applicant's financial history, including their credit score and any outstanding debts. A favorable credit history indicates responsibility and reliability in meeting financial obligations.

An adverse credit history, however, can be a red flag, so it’s best to do additional vetting before officially deciding to reject an applicant. You can obtain a credit report with the applicant's consent from any or all of the three major credit reporting agencies: TransUnion, Equifax, or Experian.

6. Rental history

What questions should you ask potential tenants about their rental history? You want to know about past evictions, complaints, and how respectful they were to their neighbors and property.

Gathering rental history documents from previous landlords will help you answer these questions and provide insight into the applicant's past behavior as a tenant.

The best way to do your due diligence is to seek out references from prior landlords. You can also call the person to ask if the tenant will be a good fit or if there are red flags to consider, like unexplained gaps in their history.

7. References

Along with contacting previous landlords, two to three additional references are a must. In cases where someone doesn’t have an extensive rental history, you can suggest the applicant submit professional or personal references or both. Be cautious of applicants who provide only family or friends as references, as their opinions might be biased. When interviewing an applicant's references, use these questions:

• How long have you known the applicant?
• Can you describe the applicant's personality and demeanor?
• What 3 words would you use to describe this applicant?
• Have you ever witnessed the applicant in a challenging situation, and how did they respond?
• Would you recommend the applicant as a tenant? Why or why not?

8. Pet history

If you allow pets, double-check that they are compatible with the property's policies and environment. Understanding a pet's behavior, size, breed, and history, including vaccinations and past incidents, helps assess potential risks like property damage, noise, or disturbances to neighbors. If you plan to charge a pet deposit or pet rent or require pet insurance, let applicants know before they sign the lease.

9. Vehicle registration and proof of insurance

Does your property include a parking lot or garage for tenants’ cars? If yes, requesting vehicle registration and vehicle proof of insurance is important to ensure they have legally registered their vehicles and have insurance.

10. Renter’s insurance

This request would not come into effect until after the tenant has signed the lease. Renter’s insurance is not a legal requirement. However, it can be a provision of the lease. Many landlords do write this into the lease. If it’s part of the agreement, the new tenant will need to provide proof of this before they move into the property.

There may be restrictions on renter's insurance in certain states. For example, landlords in California have the right to require it. Oklahoma, on the other hand, bans landlords from making this a condition.

Renter’s insurance offers valuable protection. It’s the only way to protect their personal belongings, as the homeowner’s policy would not cover this. Having coverage may also make acceptance of pets less risky.