As a rental property owner, you want to ensure your property is consistently occupied by high-quality renters. Finding long-term tenants is the easiest way to keep your investment profitable. It also allows you to avoid the risks associated with vacant rental properties. So, when a responsible tenant’s lease is over, and they want to renew it, you might want to go for it without thinking twice. But, believe it or not, this is not the best course of action.

Rushing into a renewal can lead to drawn-out issues such as costly disputes, missed rent payments, and even evictions. While you might have had a positive experience with a tenant in the past, that’s no guarantee that they won’t cause any issues moving forward. The best way to protect your investment is to perform a renewal screening before signing a new lease agreement.

With a renewal screening, you’ll be able to spot any potential problems before they arise. If you want to learn more about the benefits of renewal screening checks, keep reading! This article will cover everything you should know about renewal screenings and provide tips for conducting successful screenings while keeping your renters happy!

How Renewal Screenings Benefit You

When a lease is up, and tenants want to renew it, landlords often skip renewal screenings. This can be a recipe for disaster. A positive past experience with a tenant doesn’t guarantee you won’t have issues with them moving forward. That’s why performing a renewal screening is highly recommended.

 a property manager sits in a bright yellow armchair they have a long ponytail and wear a black blazer and white camisole while performing a renewal screening

A lot can change for your residents over the course of their lease. So, if you want to protect yourself and your property from liabilities, it’s better to go the safe route. A renewal screening will help ensure your renters can pay rent on time and follow the terms of the new lease.

Other benefits of renewal screenings are detailed below.

Saving Money

In addition to helping you avoid late and missed rent payments, re-screening tenants can help you avoid issues and financial losses in the long run. This can include additional costs associated with emergency repairs, legal fees, and even evictions.

Building Better Landlord-Tenant Relationships

Additional screening checks give you a good insight into your renter’s finances. This will help you understand any concerns they have regarding a new rental agreement. In the long run, this can help you keep your renters happy. 

Learning About Your Renter’s Situation

A lot can change for renters over the course of a tenancy. Performing a renewal screening allows you to understand better your tenant’s finances, credit score, and other things that may affect you as a landlord.

Peace of Mind

While you may already trust your tenants, performing a renewal screening will help put your mind at ease and prove that they are still responsible and trustworthy renters.

What to Look for in a Renewal Screening Check

Renewal screenings are similar to new resident screenings. In fact, they’re easier since you won’t need to gather as much information this time around.

a property manager with short black hair and a close cropped beard conducts a renewal screening at their desk while wearing a yellow crewneck sweater

Below are the four essential things to check when performing a renewal screening.

Credit

Credit reports look into your tenant’s finances. Good credit is proof that your resident is responsible enough to make rent payments on time. Because the results of a credit report can change drastically in a short period of time, you should always check a renter’s credit before letting them sign a new lease.

However, keep in mind that tenants with a slightly lower credit score may still be able to make rent payments provided their employment and income verification checks look good.

Income

Verifying a tenant’s current income will give you the security of knowing they’ll have the means to pay rent every month. You can check a renter’s income status by requesting a recent copy of their W-2 statement

Employment

Just like proof of income, verifying a renter’s employment status is essential. You can check a tenant’s employment by requesting pay stubs for the last three months or a copy of their W-2 statement. You can also contact their employer to verify the information they’ve given you.

Criminal Background

Even if you think you know a renter very well, performing a criminal background and court history check is an important part of renewal screening.

Soft Background Check

It’s essential to consider how tenants behaved during their prior lease before signing a new agreement.

Two parents and their children prepare breakfast on a kitchen island with a granite countertop in a newly upgraded rental

You can ask yourself the following questions during a soft background check:

  • Did they pay rent on time? 
  • Did they stay until the end of their prior lease? 
  • Did they keep the property in good condition? 
  • Did you have any issues with complaints about these tenants? 

If you have positive answers to these questions, you can rest assured that your tenant is worth keeping!

How to Perform Effective Renewal Screenings

While a renewal screening can be greatly beneficial, it may cause a rift between you and your tenants. Here are three tips for performing effective renewal screening checks without negatively impacting the relationship you’ve built with your renters.

Follow Fair Housing Act Guidelines

You can follow Fair Housing Act regulations by making renewal screenings a standard policy for lease renewals. You can also reach out to an industry expert for further guidance on how to do this.

Disclose the Renewal Terms Beforehand

It’s best to openly communicate with your tenants and disclose renewal terms, including renewal screenings, in your initial lease agreements and rental documents. This will help you avoid future misunderstandings or disagreements.

Hire a Professional

Some renters see renewal screenings as invasive. The best way to avoid conflict with your tenants is to hire a third-party professional to handle the process. With a leading property management company on your side, you’ll get the results of a thorough renewal screening process without the hassle!

Bottom Line

Although it may seem unnecessary, performing a renewal screening can greatly benefit you as a landlord. It allows you to weed out renters that can cause problems, protecting you and your property from liabilities. If you have more questions about renewal screenings or are looking for professional guidance, contact East Bay Property Management! With our tenant and pet screening services, we’ll help you keep your investment protected.