According to the U.S. Census Bureau, more than 35 percent of American households rent. This makes rental properties a lucrative investment.

They do demand a lot of attention and work, including screening prospective tenants. It can be difficult to know where to start and what background investigations are permissible where you live.

This article is a landlord’s guide to Maryland tenant screening. It explains the importance of performing background checks for all rental applications.

It also emphasizes the importance of complying with all landlord-tenant laws. Keep reading to learn how to screen a tenant and what types of information to look for before signing rental leases. 

Criminal Background Search

Doing a criminal background check is perhaps the most important check you can do. It can reveal a lot of different kinds of information that the landlord must consider.

You might distinguish between felony and misdemeanor offenses. It may also be useful to consider the details and circumstances surrounding the offense(s) as well. For instance, you might look at the number of crimes committed, their severity, and how long ago it happened. 

Criminal histories can point to patterns of behavior as well. For instance, several DWI offenses might indicate ongoing substance abuse issues.

Even if they are misdemeanors, you will want to be aware of any history of theft, property crimes, and violent crime. This is especially true if they would be renting multi-family dwellings.

Criminal background checks are important for protecting yourself, your business, and other tenants. Keep in mind that, even if a tenant does have a criminal history, you are not responsible for their behavior while they are renting. For instance, you cannot be arrested if they are selling drugs from the property.

However, there are some exceptions. You could face civil liability if a tenant you knew had a history of sexual violence commits an assault on the property. Also, your property could be seized for an ongoing criminal investigation into activity that occurred there.

You need to get written consent to perform criminal background checks. It also may be a good idea to state on rental applications that one will be performed. This lets potential renters know about standards upfront.

Credit History Check

Like other background checks, a credit history evaluation is not mandatory but is a good idea. A credit background report will let you know several things about a potential renter.

One is the amount of debt they have relative to their income and earning potential. It also will tell you if the individual has been turned over to a collection agency for failure to pay bills, including utilities or rent. It also will show late payments on various credit lines.

There are three main credit reporting agencies: Equifax, Experian, and TransUnion. Note that, since creditors are not required to report information to credit bureaus, information among them can vary. That is why requesting reports from each will help you get a comprehensive picture of someone’s credit history.

Employment History

Why is checking employment history important? Very simply, a tenant who has difficulty keeping a job may not be able to pay rent.

Employment history checks are more difficult than other items on this list. That is because there is no single reporting agency that has this information. So, you will need to get employment references and contact information from the individual.

You should let the present or past employer that you are conducting a tenant background check in Maryland. You can ask about salary, duration of employment, and if the individual was terminated.

Eviction Check

Eviction checks can be another component of a tenant background check in Maryland. These allow you to do a basic investigation into their rental history. There are several methods for doing so.

One is through court records. States, counties, and municipalities keep records of evictions, as they are legal proceedings. This means you have to do individual inquiries for each location, which can be daunting but not impossible.

An alternative is to hire a screening company that offers this service. They will have the resources to do thorough checks in several locations.

Compliance With State and Federal Protection Laws

Remember that, in Maryland, to conduct most components of a background check, you need to have consent from the individual. This entails them signing a form that thoroughly explains the checks you will be performing.

Also, it is important to remember that when you are conducting a Maryland tenant screening, you need to ensure that you follow state and federal laws. For instance, the federal Fair Housing Act protects people who are renting a home. It ensures that they are not denied housing based on race, religion, sexual orientation, or disability.

Maryland has its own housing discrimination standards. These offer similar protections to prospective renters but add a few categories as well.

Note that these also can vary by county. In most locations, Maryland tenant screening laws prohibit you from asking about age, ancestry, occupation, or the presence of children as disqualifying characteristics for Maryland tenants.

Note that there are exceptions to some of these. For instance, a landlord can ask about age if the property is a senior living community. Also, for shared living space in an owner-occupied rental, the landlord can ask whether children can be present.

It is important to be aware of these regulations and how they apply to your situation. One big advantage of using tenant screening services in Maryland is that these companies will be fully versed in these standards. It ensures that you are not inadvertently violating laws, which would put you and your business at risk.

Find Maryland Tenant Screening Services Today

Now that you understand how to screen a tenant, you can get started. Doing a thorough check before signing rental leases will protect you and your investment property. For the most comprehensive check available, consider hiring a Maryland tenant screening service.

MacData provides complete tenant screening services in Maryland. We get you the most information possible while ensuring compliance will all federal fair housing, HIPPA, and other landlord-tenant laws. Reach out to us today to set up screening services for your Maryland tenants.