A Landlord’s Guide To California Tenant Screening [2023]
Renters make up around 40% of residents in California. This means there are plenty of opportunities for you to pick and choose from the tenant options available. Though, how do you ensure potential rental applicants are suitable people for your property?
This article will run you through the process of California tenant screening. By the end, you should know how to screen tenants without breaching regulations while ensuring you run the best check possible.
Collect Information
One of the first things you should do in the tenant screening process is ensure you have all the information you can gather. This might include their:
- Full legal name
- Contact information
- Social security number
- Previous addresses
- Which previous addresses were rentals
- Employment details
- Personal references
Each of these can help you in different ways and give you a rounded view of the nature of the potential tenant.
Conduct Background Checks
One of the first things you want to do to check rental applicants is conduct a comprehensive background check. This can give you all the information that might highlight red flags for a potential tenant.
A tenant background check in California can offer you several benefits.
It allows you to check the information the tenant gave you against the information that comes from the background check. This allows you to fill in any blank spaces they might have left and follow up with them as to why.
These may have been mistakes, they may have thought them irrelevant, or they might have hidden them on purpose. Also, if you find discrepancies, this either suggests a lack of attention to detail and bookkeeping, or an attempt to hide something. Either way, it is not great.
When you conduct background checks it also allows you to look at whether someone has a criminal record. Although, bear in mind California tenant screening laws related to this as mentioned below. What will be much more useful is learning if the individual is on a sex offender or terrorist registry so you can respond as early as possible.
Assess Credit and Finances
Before you run a credit check, you will need written consent from the individual. This is mandated by the Fair Credit Reporting Act, so ensure you take the right steps as defined by this law.
Looking at the credit of an applicant will give you a very good idea about how well they can handle their finances. You will want to know if someone is going to be able to afford their rent over a long period. If they have outstanding debts or a history of bad credit, this may not be the case and you should be more careful.
If they have a good credit score, pay bills on time, and have a good debt-to-income ratio they may be the type of person you are looking for. They are much more likely to pay any rent on time or even be good if you need to increase rent in the future.
Learn About Their Employment
When you get their employment details, follow up with the human resources department where they work. Verify their employment details and information about their role and income, so you can ensure they have told you the truth. You can even ask for a pay stub or record of previous income if you want to ensure the potential tenant meets rent cost requirements.
Looking at their employment history, make sure that they not only have employment now but also a record of stable jobs. If they rent from you, only to lose a job soon after, this could affect their ability to pay rent so high levels of stability are imperative.
Ask for References
Having a list of references can give you a little more information about the potential tenant’s character. This is relevant not only because you can get a good idea of who the person is from others. Also, you can judge someone by the quality of the references they give you and how trustworthy those people seem to be.
Talk with previous landlords to find out more about if the person kept their rental properties tidy and if the tenant was socially likable. This can ensure you have an easier time with them moving forward.
When you discuss the tenant with people, make sure to ask specific questions. Do not expect people to bring up anything negative, so push a little and see what you find.
California Tenant Screening Regulations
California tenant screening laws and regulations are a major point of contention for many landlords. While they are in place for the protection of tenants, they can still cause issues for landlords who are not acting unethically. Some of the following are things you need to watch out for.
Fair Employment and Housing Act
This law ensures people avoid discriminating against others based on a list of characteristics. Make sure to check you do not have unintended biases against people for these by always running the same checks on all tenants.
Restrictions on Screening for Criminal History
While running a tenant background check in California is possible, you cannot learn certain things from them. For example, non-felony marijuana convictions or non-conviction arrests will not show up.
Eviction Record Disclosure
Be aware that when looking at a person’s previous rental properties, you will not receive data on evictions past seven years. If you contact a landlord from before then, they must follow strict rules on reporting rental history.
California Credit Check Regulations
There are very strict rules regarding credit checks as laid out by the:
- California Consumer Credit Reporting Agencies Act
- Investigative Consumer Reporting Agencies Act
- California Consumer Financial Protection Law
- Fair Credit Reporting Act
Ensure you follow these to the letter. This is one of the reasons why people use tenant screening services in California, as they have experience with such rules.
Using a California Tenant Screening Service
Using each of the above steps, you should be able to ensure that your California tenant screening process goes off without a hitch. Still, this is a lot of work, and you might want to skip all that and start raking in the money. We can help you with working out how to screen tenants without hassle.
We provide tenant screening services in California and would be happy to take all that work off of your hands. So, get in contact and find out how to fill your residence with the minimum of effort today.