SMARTERLANDLORDING

ADVICE FROM EXPERIENCE

Tenant Screening

The Tightening Against Landlords Continues

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Back in July, I wrote that the slew of new regulations and restrictions against landlords would likely never go away. History shows that once the ratchet is tightened, it is never loosened completely. Some of the headlines from Maine to California seem to be proving my predictions correct.

Landlord-tenant laws in Virginia spurred on by covid could be come permanent.

Minneapolis to consider rent control.

Rent control pushed in Maine.

Eviction bans in San Jose.

Eviction bans state wide in California.

Learning how to screen your tenants and work with them is going to be more important than ever in the coming months and years. It is going to get ugly in some places. Stay tuned and seek out folks with common ground.

Kevin Perk is the founder and publisher of Smarterlandlording.com. He is the author of Advice From Experience To New Real Estate Investors.  Subscribe to Smarterlandlording here. Contact Kevin here.

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Will Rental Standards Change?

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During these unsettled times with covid making the rounds and social issues taking center stage, the criteria and standards we landlords use to qualify our tenants may change. These changes may be dictated by the local government as in St. Paul, or we as individual business owners may determine change is needed due to shifting market and social conditions.

When rents are climbing and the market is tight, we landlords can almost pick and choose who we want to live in our properties. As the market loosens, and I think it very well might do so in the near future, we have to become more flexible. We are also not immune to social pressures. Housing is in fact a growing concern for many across the country and legislation forcing changes to our business models is a distinct possibility right now.

Even with all of these changes that are and could possibly occur, we still want to find tenants who will pay, stay and respect our properties. These three criteria are what we should always be aiming for. There are many ways to achieve this goal and what works in one area or market may not necessarily be what works in another.

Of course, every landlord has to begin their rental standards with the federal fair housing laws. These laws protect certain classes from housing discrimination. These classes are race, religion, color, national origin, familial status, age and gender. Disability, military/veteran status and sexual orientation are others that often (and should) make the list. From there however things change with location and market.

For example, in our business we rely heavily on credit history. We operate in a market where using that criteria works well. There are markets however where that criteria will not. There are markets where most applicants will have poor credit histories. Thus, other criteria should and can be utilized. What sorts of criteria could you use instead? Perhaps job and residential stability. Seek stability in terms of employment and living arrangements. Examine if your applicant changes jobs and addresses frequently. If so, than they may not be right for you even with the best of credit reports.

Evictions are another criteria that are often used and which is currently under attack for being used in many jurisdictions. But in some markets many of the applicants will have evictions on their records. It just comes with the territory. Should you ban people with any eviction in their past? Maybe. But perhaps a better strategy is to set a time limit and look for positive change in the applicant. When was their last eviction? Last week? Last year? Ten years ago? When can make a difference.

Whatever criteria or rental standards you use and however you decide to change them due to changing market and political conditions make sure you follow the law and make sure you WRITE THEM DOWN. Keep a list of your criteria and standards on a sheet of paper in your desk so you can do to things.

1. Follow them with every applicant.

2.Show them to anyone who asks.

Trust me, doing so will save you much future grief.

Are your rental standards changing these days? Please share with a comment.

Kevin Perk is the founder and publisher of Smarterlandlording.com. He is the author of Advice From Experience To New Real Estate Investors.  Subscribe to Smarterlandlording here. Contact Kevin here.

Subscribe to Smarterlandlording and receive a Free Report: 21 Tenant Screening Red Flags

Good Tenant Screening Can Prevent Evictions

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Jurisdictions across the United States have halted or severely restricted evictions.. Only now, as I write this in late May 2020 are some states like Texas beginning to reopen the courts. How long will other jurisdictions remain closed? Will new laws be passed to make evictions, especially no fault evictions, more difficult? What if they decide to shut everything down again? What if, what if?

One thing we do know for sure, things will never be the same as they were before. We landlords can likely rest assured that courts will make the eviction process more difficult, that local governments will pass laws to restrict the types of evictions that can be done or institute new hurdles to do so. Some jurisdictions are even setting up systems (with tax dollars) to help tenants fight evictions.

The covid pandemic and the government response of closing the courts has emphasized the importance of one vital aspect of landlording, tenant screening. Tenant screening, especially now without the hammer of the courts, is perhaps the most important thing a landlord can do. It is more important that finding properties, repairing them, or even acquiring funding. Having a deadbeat tenant, especially one you cannot remove by the eviction process, will ruin you and your business.

With the courts closed tenant screening simply has become much more important. As a landlord, you just cannot let potential deadbeat tenants into your property. You have to learn and hone the skills to spot potential problems before they become your problem. I can tell you after over 15 years in this business, almost every tenant problem I have had, from evictions down to the complainers, has been because a red flag was ignored or an issue overlooked during the screening process. Yes, every problem tenant ultimately reflected back to me. In other words, I have had to learn the hard way no to ignore the signs or my screening criteria.

During this pandemic, several of our tenants have had problems. How could they not? Large sections of the economy have after all been shut off and their jobs have evaporated. Of course some people are going to have problems meeting their obligations when they cannot generate an income. But everyone has worked with us so far. Why? One, because we worked hard at screening and bringing in decent people. Second, we worked with them when they hit a problem.

Over the years and after screening hundred of tenants, we have learned to recognize the subtle signs of deeper problems such as a lack of interest, a sense of urgency or answers that seem just a bit too rehearsed. We have found that people are good at lying and you have to be better at detecting the lies. Deep down most of us want to trust and believe what others say. But you simply cannot. The reality of the situation is that as a landlord, you cannot accept anything you are told at face value. In fact, I guess I would go so far to say that we have to assume that we are being lied to until we find out that we are not.

Recognizing red flags and conducting thorough tenant screening are skills that can be learned. To help you, I wrote about 21 major red flags that every landlord should look for when screening tenants which you can get for free by clicking here.

Will you still have to learn some things that hard way like I did? Yes, most likely. But by educating yourself now and by starting to hold folks to a higher standard you can keep many of the headaches out and avoid the problems of closed eviction courts altogether.

Four Tenant Screening Techniques To Use With The Standard Background Check

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I harp on it lot, but tenant screening is perhaps the most important thing a landlord does. Keeping problem tenants out of your properties will save you money, time and loads of frustration.

Most are already aware that effective tenant screening should involve a credit and criminal history background check. We run one on every adult applicant through our property management software, Appfolio. An alternative background check source is RentPerfect.com. In my opinion however, to be truly effective, tenant screening has to go deeper than the standard background check. Effective tenant screening requires a landlord to seek out what is hidden and what may be lurking outside of standard background reports.

To help you be more effective with your tenant screening, here are four tenant screening techniques that we use to dig deeper and avoid those problem tenants.

1. Verify Income – One rental standard that we and many other landlords use is based on income. This standard ensures that your applicant has the income to be able to afford the rent and most other necessities in life. If this standard is not met, your tenant will be making choices on who to pay every month. You very well could be on the losing end of those decisions if they do not have the necessary income.  

Despite the standards you set and advertise, some applicants will tell you anything. The will tell you that they do meet your income standards when they do not. Thus, you simply cannot believe what you are told. You have to verify it. Sometimes a credit report will tell verify or at least offer clues to income, but other times it will not.

When it comes to income, you should contact your applicant’s employer to help verify it. You do not have to be real specific when doing so. Simply asking if Ms. Applicant makes approximately $X per month will do.

Sounds easy and straightforward right? It is not. People do work for themselves after all, so who would you call in that case? Some companies also charge (I’m looking at you FedEx) to verify income. Others will lie, falsify records and set up schemes to try and dupe you. One way to get around these issues is to ask for recent check stubs and bank statements. But, as I said, these can be faked. So make sure names match, employers match, addresses match and dates are correct  

If you decide to make a phone call to either a bank or an employer, it is best not to use the phone number provided to you by the applicant. Who knows who is on the other side of that number? It could very well be the bank or the employer but it could also be a friend or relative helping with the cover up. Instead, Google the name of the bank or employer and call the main number. Then get transferred to the person you need to verify the information.

2. Check Local Data Sources – Yes, a nationwide credit and criminal background check should be done, but local sources of information should not be overlooked. Many local records, such as those from civil and criminal court, property transfers and even utility hookups are online. Those records should be searched by you for info on your applicant. Here in Memphis we use the Daily News. They charge a monthly fee to be able to access their services, but the cost is minimal compared to dealing with a problem tenant.

3. Search Local Sex Offender Registries – Your national criminal and credit background search will likely include a sex offender registry search, but why not check out your local sources as well just to be sure? It only takes a few minutes and sites such as the Tennessee Sex Offender Registry even provide a picture. In that way you can be sure who your applicant is as many names can be similar and mistakes in data entry do happen.

4. Ask Questions Again – A key to uncovering lies and red flags is to ask the same questions over and over again. Not repeatedly and aggressively, but as part of a smooth and general conversation you might have over time. You should for example ask questions when you receive that first phone call. Make note of the answers. Then ask the same questions again when doing a showing and on your formal application.  Ask your questions and then be silent. People hate silence and will begin to babble to fill it up. Listen and look for for inconsistencies. People will often have a hard time remembering the lies they have told. Their attempts to continue to weave the web will often make those lies show themselves.

I wish that everyone could be trusted in this world, but unfortunately a few bad apples make it hard on everyone. Hopefully the techniques I have descried above will help you weed the bad ones out. If you do not weed then out, bad tenants can do a lot of damage in a very short amount of time. It is incumbent on you to do all you can to prevent this before it starts. Just remember to be sure that whatever you do when screening tenants, that it is legal and evenly applied to all.

Kevin Perk is the founder and publisher of Smarterlandlording.com. He is the author of Advice From Experience To New Real Estate Investors.  Subscribe to Smarterlandlording here. Contact Kevin here.

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5 Questions You Must Ask Every Applicant

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One of the most important things a landlord does is screen tenants. Yes, finding properties, keeping up with the books and property maintenance are also important. But, fail at screening and let a problem tenant in one of your properties and the troubles can mount quickly.

Problem tenants will not only cost you money, they will also create loads of tenant drama for you. Not only might you not get the rent you are owed, numerous other issues come with problem tenants. Problem tenants damage property, generate endless phone calls and complaints, cause your good tenants to leave, bring trash, filth and who knows who and what else with them. As a landlord, your best bet is to avoid these problem tenants all together. And you do that with good tenant screening.  

Tenant screening begins at that very first point of contact with a prospective tenant. During that first phone call, not only do you have the job of selling your property and services, but you must also be on the look out for red flags signaling you that the person on the other end of the line is a potential problem. Asking the right questions will help you do a good job of screening.

What to ask then? Here are 5 questions you must ask every applicant in order to help you see the red flags and screen out potential problem tenants.

  1. Why are you moving? – This open ended question asks the prospective tenant to describe what is going on their life. Why do you want to know? Because whatever is going on will move in to your place. Think about what the following two answers to this question can tell you. First answer. “I have taken a new job in your city.”  Second answer. “I hate my current landlord.” The first answer tells you your perspective tenant needs to move for a legitimate reason. It tells you they also have a job. The second answer is much different and raises red flags. Perhaps they have a legitimate reason to move, but perhaps also their current landlord is just as happy to get rid of them. Each answer needs verification, but the second one is going to cause me to be more cautious.
  2. When do you need to move? – Most people do not and should not have to move tomorrow. Most people are reasonable, understand when their lease is up and begin looking for a new place to live in a adequate amount of time. If you get an answer from your prospective tenant that they have to move tomorrow or even next week, then you may want to cut things off right there. Unless there was a fire, there is really no good reason someone has to move tomorrow. On the flip side, you are also wasting your time if someone is looking six months out. Will you hold that vacant apartment for six months? Not likely. Tell the person who has to move tomorrow that there is no way they can get through your screening process that quickly. Ask the person looking six months in advance to get back in touch a couple of months away from when they are ready to move.
  3. Who will be living with you? – Who will be living in the property? You need to know and keep track of this because every adult living in your property absolutely must go through your screening process. Believe me when I say that people will try and hide the fact that other people, such as boyfriends, girlfriends, roommates, relatives, etc., will be living with them. Why do they trying to hide this? What have these folks done? Find out before it moves in to your property.
  4. Are the properties I have available in your price range? – This question is designed to let your prospective tenant decide if what you have available fits them and thus screen themselves. You should always tell every person who calls about everything you have available, even if they called about one specific property. DO NOT TRY TO STEER THEM TOWARDS ONE PLACE OVER ANOTHER. DO NOT LEAVE ANY PROPETY OUT OF YOUR CONVERSATION. Let the prospective tenant decide what property and rent fits their budget and needs. Then go from there. In this way, you can avoid being accused of discriminatory practices.
  5. Have you or anyone you will be living with been evicted or filed for bankruptcy? – This question is essential. Most landlords will not rent to someone who has recently been evicted or filed for bankruptcy. You probably should not either. So you might as well get this question out of the way as soon as possible. If the answer to this question is “No,” a background check will likely prove if they are lying or not (People will and do lie about this). If the answer is “Yes,” dig deeper. Ask about circumstances. Depending on your market and rental standards, “Yes” may not necessarily mean a “No” from you. But you will surly want to find out more.

Being lax with your tenant screening is something is a high risk action when you are a landlord. It sounds terrible, but you just cannot trust anyone to tell you the truth and you have to develop a keen sense for seeing the red flags. Asking both direct and open ended questions designed to elicit information from your prospective tenant, such as those outlined above, will go a long way towards screening out the problems right from the beginning.

5 Questions To Always Ask Your Tenants

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One of the first presentations I heard when I started going to MIG over 15 years ago was by Don Beck.  In it, he had a set of laws for landlords.  One of those laws was “no matter what the question, your tenant will have an answer.”  Some of these answers are true, some are not.  Many are attempts to deflect or redirect.

Some questions always seem to bring out the bring out interesting answers from tenants, especially prospective tenants.  These are questions however that you must always ask.  What are these questions?  Here are 5 questions to always ask your tenants.

What about this gap in your residential living arrangements?

When a prospective tenant does not show a continuous line of residency, you must ask this question.  When here is a gap, often of a year or more, that is unexplained you need to find out why.  Where was the applicant living during this time?  Why have the chosen not to tell you about that gap?

This residential gap could be completely innocent and explainable.  The applicant may have had to move back home to care for a sick relative or they could have moved in with someone and the relationship turned sour.  These are items your applicant might not think matters or they are embarrassed to admit.

On the other hand, they may have been evicted.  Or, they may not be able to get a good reference from that landlord and hoped you would not notice the gap.  Either way you need to explore the reasons for the gap.

What about this gap in your work history?

This is another common question that has to be asked.  Again, the answer could be something completely innocent.  It include such things as simply taking time off, going back to school or caring for that sick relative.  Or they could be trying to hide the fact that they were fired for theft.  You will never know until you ask.

What about this account in collections?

Finding tenants who will pay, stay and respect our properties is the name of the game.  That is why you have to ask these questions.  Yes, the account may be old and they may have been embarrassed to put such things on your application.  Few of us are ever perfect.  But, as landlords we simply have to dig deeper to find out what is really going on.  Was this a past mistake or is there a pattern that continues to the present?

Who will be living with you?

This is a question that needs to be asked so you can document the answer.  Make sure you make a note when your prospective tenant answers “no one.” or “just my daughter.”  On more than one occasion we have found evidence that someone other than what we were told by the tenant has moved in with them.

Do you have any pets?

Some folks will be honest with this question, others will not.  We love pets and allow cats and smaller dogs, but many will try to get around the pet fees.  Thing is, we always tend to find out because we will be going in the property at some point (often for maintenance) and the evidence will be there.  Again, it is best to have things documented from the very beginning.

Not everyone that you meet and applies to live in one of your properties is going to lie, but enough do that we have to ask these questions. Landlords often have to do some detective work to flush out the lies and the potentially bad tenants before they move in.  And while tenants may always have an answer, sometimes it will be pretty easy to see through them.

Have a question you always ask your tenants?  Ever get an interesting answer?  Please share with a comment below.

Kevin Perk is the founder and publisher of Smarterlandlording.com.  He is the author of Advice From Experience To New Real Estate Investors.  Subscribe to Smarterlandlording here.  Contact Kevin here.

Subscribe to Smarterlandlording and receive a Free Report: 21 Tenant Screening Red Flags

Uncover Lies By Using Rental Standards

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My book, Advice From Experience To New Real Estate Investors, has a chapter on what newbies should know before they become a landlord. In that chapter I note that lying is a widespread and uncovering lies is part of the landlording business.  One way to uncover lies is by using rental standards.

Be warned, no matter how good someone appears on the surface, you just cannot trust them.  People lie and try to cover up their past deeds all the time.  Some, are simply embarrassed.  Some, such as professional tenants, are purposefully trying to deceive you.  Others, tell little white lies and hope you will not notice.  No matter who is doing the lying or why, it is your job to uncover the lies before you let an applicant move in to your property.  The best way to do this is with consistently applied rental standards.

Two Key Rental Standards

Rental standards are comprised of many parts.  But two key parts to any set of rental standards are a rental application and credit history. Requiring every applicant to fully complete a well structured rental application provides the landlord with a basis to uncover dishonest answers.  On your application, always ask questions about an applicant’s rental and credit history.  These questions should include:

  • Where did the applicant live?
  • How long did they live there?
  • What was the amount of their rent?
  • How often did they pay the rent late?
  • Have they ever been evicted?
  • Have they ever filed bankruptcy or had a judgement against them?

Not everyone is going to lie on their application when answering these questions, but some will.

Pulling a credit report is the second key part of this process.  Reviewing a credit report on every adult who wants to live in one of your properties is an absolute must.  Credit reports show many items, including:

  • Late payments
  • Bankruptcies
  • Charge offs (when a creditor has given up trying to collect debt)
  • Closed accounts
  • Judgments
  • Accounts in collection.

Compare The Two Keys

By comparing the application against the credit report, any inconsistencies should appear.  If you find that an applicant has outright lied, best to let them find somewhere else to live.

On the other hand, give an applicant some consideration if they tell you the truth about past issues.  After all, none of us are perfect and it is hard to tell the truth when you know it might hurt you.  Look for signs that the applicant really is trying to improve or get back on their feet.

You Set Your Standards

Remember, as the landlord you can set your own rental standards and you do not have to reject applicants who are honest yet have a bit of a checkered past.  You can instead adopt rental standards that reward improving behavior.  These standards could include:

  • No bankruptcies within the past X years.
  • No judgments within the past X years.
  • Less than X late payments within the past X years.
  • No accounts in collection.

As the landlord, the standards you use are up to you and the market you serve.  There is often a lot of flexibility (other than legally protected classes) on what your rental standards can be.  I would even say that your standards should evolve as you learn and grow your business.  Just be sure to apply whatever standards you use consistently.

Uncovered any big lies as a landlord?  Please share with a comment.

Kevin Perk is the founder and publisher of Smarterlandlording.com.  He is the author of Advice From Experience To New Real Estate Investors.  Contact Kevin here.

Subscribe to Smarterlandlording and receive a Free Report: 21 Tenant Screening Red Flags

Tenant Referrals

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How to best provide tenant referralsIf you are in the landlording business long enough, you will eventually be asked to provide a referral for a previous tenant.  Referrals are a great tenant screening tool that should be in every landlord’s rental standards toolbox.  On the surface, providing tenant referrals may seem simple enough, but you should exercise some caution when doing so.  What is the best way to respond when asked for tenant referrals?

Referral Requests Come In All Sizes

We receive many different types of tenant referral requests.  Some are just a quick phone call.  Some want to have a long conversation. Others will fax or e-mail a long form they want us to fill out.  Every landlord seems to have a different way of asking for tenant referrals.

But no matter how different landlords ask, we believe in keeping things simple and to the point.  Why?  Landlords have to remember that we do live in a somewhat litigious society.  The tenant referral we give could potentially make or break someone’s application for housing.  If someone feels they were wrongly denied housing, you could easily be brought into that conflict.

Keep Referrals Short And Consistent

With that in mind, it is best to keep your referrals short, succinct and consistent.  There is no need to have a long, drawn out conversation. Nor is there a need to go into too much detail.  There is however a need to keep things consistent and focused.

When a landlord calls you asking for a referral, We believe the best strategy is to use one of the following phrases. “Yes, I would rent to that tenant again,” or “No, I would not rent to that tenant again.”  After all, what more needs to be said.

If you get a fax or e-mail referral form (Yes some landlords still use a fax because it is more difficult to falsify.), examine the questions it is asking you.  Are they related to a tenant’s ability to pay, stay and respect the property?  Are they asking only about rental payments and damages caused?  If so, go ahead and answer them.  If not, be careful as you might be treading into ambiguous territory.

Focus Tenant Referrals On What Matters

The key is to remember to keep things focused on the tenant’s ability to pay, stay and respect property.  Going beyond that leads to trouble and becomes inconsistent.

How do you handle tenant referral requests?  Please share with a comment.

Kevin Perk is the founder and publisher of Smarterlandlording.com.  He is the author of Advice From Experience To New Real Estate Investors.  Contact Kevin here.

Subscribe to Smarterlandlording and receive a Free Report: 21 Tenant Screening Red Flags

How To Confirm Income

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One often used rental standard is an income requirement. Requiring a prospective tenant to show that they have adequate income is a smart way to qualify them. Using this standard requires landlords to learn how to confirm income. Because just being told something on your application does not make it true.  How can you confirm income?

The Income Requirement Rental Standard

The actual rental standard can vary, but it is often stated as some multiple of the monthly rent.  For example, a landlord may require qualified tenants to have three times the rental amount in income.  Thus, if a rental unit is offered at $1,000 per month, a potential tenant would have to demonstrate $3,000 per month in income.

Why would a landlord have such a standard?  An Income requirement standard helps to ensure that potential tenants can actually afford the rental unit and will pay the rent. Someone without adequate income might be forced into a decision of either paying rent, eating or keeping the heat on.  We landlords want to avoid tenants having to make those decisions as the rent payment often gets placed on the back burner.

Income Has To Be Verifiable

Unfortunately, landlords should not just believe what potential tenants tell us.  We have to confirm, or verify, what we are told because people lie.  Prospective tenants also know that smarter landlords will try to verify their income.  This fact can cause some of them to get pretty creative at deception.  They might even be a professional at duping naive landlords.

Confirming And Verifying Income

The first thing you as the landlord should do is ask for a verifiable income amount on your application.  Understand that income can be had from many different sources, such as a job, alimony, disability benefits or drug dealing.  Three of these are verifiable, one is likely not.  All can be faked however and those falsehoods are what we must uncover.

How?

If they have a job, one way is to call the employer.  We definitely do that, but not in the way the tenant thinks we will.  On our application, we ask for their employment contact information.  We do not however use the contact phone number provided by the applicant.  Instead we Google the employer and call the number that shows up on the search, then get directed to the person or department we need.  In this way we bypass the “Vandalay Industries” trick.  We have had more than one applicant try and use this technique in the past.

Secondly, look at the paper trail.  Any verifiable source of income will have a paper trail  These might be check stubs, bank statements, even tax returns could be used.  But guess what?  These can also be faked.  There are websites out there that sell fake check stubs for example.  The best way around that is to become a detective.

Legwork Pays Off

Most times after a little legwork on your part, things simply will not add up.  Addresses will not match.  Phone numbers will not be connected and dates will be off.  When you find these inconsistencies, you need to ask for more information.  If no clarity is provided, then you can reject the application, since income could not be confirmed.

This may seem like a lengthy process, and it can be.  But it is quite worth it as you just may save yourself from an eviction later on.

Have a good story about a prospective tenant trying to fake their income?  Please share with a comment.

Kevin Perk is the founder and publisher of Smarterlandlording.com.  He is the author of Advice From Experience To New Real Estate Investors.  Contact Kevin here.

 

Subscribe to Smarterlandlording and receive a Free Report: 21 Tenant Screening Red Flags

Unintended Discrimination

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Landlording can at times be like walking in a minefield.  One small, unintended misstep and boom!  It blows up in your face.  No one intends to step on a landmine, and the majority of landlords I know do not intend to discriminate.  But small missteps can lead to unintended discrimination and potential legal trouble.  Here is how.

Most People Want To Be Helpful

Most people, by their basic human nature, want to be helpful towards others.  Many will hold a door, give directions when asked and offer helpful advice.  Being helpful is one way we all function together in society.  Being nice to each other helps us all get along.  Unfortunately, anti-discrimination laws can cause landlords to trip and step on that proverbial mine if they are not too careful with their “helpful” advice.  And being accused of discrimination is a serious landmine.

To help explain, let’s pretend that you have made it past that first phone call with a prospective tenant.   They did some checking and have called you back to further discuss what you have available.  What are some things you might say that could lead to inadvertent and unintentional discrimination charge?

This One Has More Bedrooms

Your prospective tenant might tell you that she has a child or two that will be living with her, or she may mention that her elderly father or mother may be moving in.  While looking at a one bedroom apartment, you begin to suggest two and three bedroom properties you have available. You suggest them because you honestly believe they might be a better fit.  Unfortunately, that advice may be misconstrued as attempting to drive someone away or towards a specific property because they have children or of their familial status.

This Apartment Might Be Quieter

You might think that by suggesting an apartment at the end of the hall, or on the top floor, or in the back may be helpful to your prospective tenant.  And it could be.  But, it could also be interpreted in a negative manner.  They might think that you are trying to keep them and their kids out of the way or out of sight.

The Units I Have In This Particular Neighborhood Might Be More Too Your Liking

You might be completely right.  Your tenant may favor a unit in a particular neighborhood.  Again however such a suggestion can easily be misinterpreted.   It may appear to your prospective tenant that you are trying to steer them away or towards a particular area.  “Why would they want to steer me towards that particular area?” they might ask themselves.  They might think that it is because they are black or lower income or have kids.

This Apartment May Be Closer To Your Price Range

Yes, one of the screening questions you should ask on that first call is about income, but offering advice or suggestions could be misconstrued as steering someone towards a location, especially if you have multiple units in multiple locations.  We all know that location, location, location affects the rental price.  Thus rents will vary depending on location.  Again do not appear that you are trying to steer.

Keep Your Advice To Yourself

As I said in the intro, most people just want to be helpful.  Most landlords are the same way.  They often have the best of intentions.   They may really believe that a particular unit in a particular building or a particular location is best for their prospective tenant.  But good intentions can have negative consequences.

Landlords should avoid making these types of suggestions to prospective tenants.  Instead, tell them about every property you have available.  Then, let them know about your rental standards and criteria and leave it at that.  Let them then decide on their own, which properties are best for them.  Then let them apply.  It seems sort of wrong not to be able to make informed suggestions to help someone, but that is just the world we live in today.  One person’s helpful suggestion, can and will be interpreted as unintended discrimination.

Kevin Perk is the founder and publisher of Smarterlandlording.com.  He is the author of Advice From Experience To New Real Estate Investors.  Contact Kevin here.

Subscribe to Smarterlandlording and receive a Free Report: 21 Tenant Screening Red Flags