The Ultimate Guide to Tenant Screening: Key Realty Center’s Proven Process in Elk Grove, Sacramento, and Galt

At Key Realty Center, we have a proven process that allows for better, more consistent tenant screening that’s not only effective but compliant with all fair housing laws. The technology we use keeps everything objective and automated. Our understanding of how to verify all of the information we’re given allows us to feel good about renting your property to the most qualified tenant.

This is important because an extensive and detailed tenant screening process can limit the risk you take when renting out homes in Elk Grove, Sacramento, and Galt. The rental experience you have will largely depend on the tenant you place. Well-screened and well-qualified tenants will pay rent on time every month. They’ll take care of the property and let you know when maintenance is needed. They’ll communicate openly and honestly, follow the terms of the lease agreement, and renew that lease year after year. 

Bad tenants, however, will deliver a rental experience that’s the opposite of peaceful and profitable. You’ll find you’re stuck with stress, frustration, additional expenses, and potential legal challenges. You might find yourself having to chase down late rent, evict your residents in court, and deal with excessive damage after they’ve moved out. Unqualified tenants can be a huge liability. 

At Key Realty Center, we have the experience and the tools that position us to better evaluate potential tenants, identify red flags, and dig a little deeper when it comes to placing residents in your property. 

Here’s our ultimate guide to screening potential tenants. We’re confident in our criteria and our process because we rarely have to evict and our rent is collected on time.  

Fair Housing First: Tips for a Compliant Process

You do not want to screen any tenants without being familiar with the federal fair housing laws. The Fair Housing Act mandates that we don’t discriminate against any tenants or applicants. As you may know, the law establishes seven protected classes. 

This is California, and California fair housing laws go even further. When you’re screening tenants in Sacramento, Elk Grove, or Galt, you have additional protected classes to consider. We stay on top of every new addition to the list and we carefully track all changes to the local, state, and federal fair housing laws. Here’s the full list of protected classes, both federal and state combined:

• Race
• Skin color
• Religion or creed
• National origin or ancestry
• Sex
• Physical or mental disability
• Familial status
• Sexual orientation
• Age
• Gender identification
• Gender expression
• Veteran or military status
• Citizenship 
• Primary language
• Marital status
• Source of income
• Genetic information

As expert property managers, we know that this is a list that’s constantly evolving. We have a solid plan in place for staying up to date on all the critical laws that are proposed and passed in California, especially when we’re talking about fair housing. Even the federal laws get changed and expanded frequently. If you’re screening tenants on your own and you don’t feel like you’re able to stay up to date, working with a property management company is important. Contact us at Key Realty Center. 

Violating fair housing laws is extremely costly, and that’s why we make sure that we’re screening with a consistent and well-documented process. If a tenant or a prospective tenant files a fair housing claim against you, there will be a lengthy investigation process and if you’re found to have violated the law, you could be fined up to $16,000 for a first offense. 

Establish Rental Qualifying Criteria

Our process for screening tenants starts with a set of standards that must be met before any applicant can be approved to rent your property. We set income standards, credit standards, and a list of other requirements for tenants to evaluate before they spend their time and resources applying for a home that they may not be qualified to rent. Most tenants expect that they will have to meet reasonable requirements before they can be offered a lease agreement. With our written criteria available, they can decide whether or not they’re likely to be approved.

Having a documented set of criteria will also protect you against any potentially expensive fair housing mistakes. Our documented set of criteria will demonstrate those objective standards that every applicant must meet. 

Key Realty Center’s Thorough Rental Application

Every potential tenant who is 18 years of age or older will need to complete an application and pay an application fee. Our applications will allow us to collect relevant information on any minors who may be living at the property, but those occupants won’t be financially responsible for the unit, so we don’t require applications for the under-18 crowd. 

The written application we provide for all interested tenants collects all the pertinent information we need to screen including:

• Full legal names
• Contact information
• Social security and driver’s license numbers
• Current and past addresses
• Employment information
• Landlord references

An important part of our application is that it collects permission from the applicant to conduct a background check and a credit check. If you’re screening on your own, it’s important to understand that you need this consent otherwise you cannot legally do the necessary checking.

Good tenants who are serious about renting your property are likely to fill out the application completely and quickly. Most of today’s tenants are tech-driven, and they want to move as fast as we do. So, they’ll appreciate an online application rather than a paper application that they’ll need to fill out with a pen and drop off or send through the mail. We make the process as convenient and secure as possible for both residents and property owners. 

To properly screen tenants, we will collect documentation such as a copy of their government-issued I.D. We allow them to securely upload those documents with the application. 

Before they complete an application, we provide prospective tenants with our screening criteria. 

Screening Tenants in Elk Grove, Galt, and Sacramento: Income and Credit

So, what do we look for when we are screening tenants for your property?

Our specific screening criteria requires a minimum credit score, but we have found that the credit number is not nearly as telling as the full credit report. We always check credit before approving a tenant, and we caution owners not to have unreasonably high standards for the credit scores they want to see. It’s unlikely that we’ll have someone with perfect credit applying to rent your home. But, we still want to set a threshold and we want to review the credit report to look for any red flags or issues. 

Some of those red flags that give us pause while evaluating credit may be:

• Money owed to former landlords, property managers, or apartment communities 
• Delinquent housing-related accounts such as utilities, cable, etc. 
• Prior evictions (these won’t always show up on a credit report, so we conduct a check of the national eviction database as well)
• A lengthy history of court judgments, unpaid debts, and collection accounts

It’s important that the applicant isn’t carrying so much debt that all of their income goes to paying it off. What will be left over for rent?

For income, best practices say that we should look for someone who earns at least three times the rental amount. This means if you’re asking $2,200 in rent, you’re looking for monthly income from all adult tenants that exceeds $6,600. Our system can verify that tenants earn what they say they earn. We always ask for proof of income through pay stubs, employment contracts, tax filings, and bank statements. 

In our experience, having these financial standards in place establishes accountability and protects our owners against the risk of tenants who can’t or won’t pay rent.

Committing to Rental Reference Checks

We know that a lot of landlords and property managers will run a credit check, glance at income amounts, and provide approval. We believe tenant screening requires more than that. 

For example, reference checks are an important step in the screening process. A current or former landlord can provide us with a clear understanding of how your prospective tenant behaves in the property they rent. 

On the application, we ask for at least two landlord references. Then, we verify the contact information so we know we aren’t calling the applicant’s friends or family members. If someone had a bad experience with landlords in the past, they won’t want us to talk with them. 

We ask the former landlord to confirm the dates of residency and the amount of rent that was paid. We ask if the entire security deposit was returned and if proper notice was given before that tenant moved out. We also ask if rent was paid on time, and how quickly the tenant caught up if it was ever late. 

When we have an applicant with pets, we ask if there are any issues with those animals. We find out if there was property damage left behind when the tenant moved out. Always, we will ask if they’d be willing to rent to the tenant again. That one question and answer often tells us everything we need to know.

Tenant screening can be time consuming, but it’s essential to find a qualified tenant for your rental property in Elk Grove, Galt, or Sacramento. Let’s talk more about what you can expect from us. Contact our team at Key Realty Center.