Commercial Real Estate Tenant Screening Checklist
The length of a commercial lease is longer than a residential one. Generally, a commercial unit is leased for 3-5 years. Since it involves a lot of money, it is important to screen tenants before renting. Read on for essential commercial real estate listings before renting office space.
Have an established process for screening tenants
One must have a process in place to screen the inhabitants. Prospective tenants must complete an application form. On the form, one must seek permission to do a credit check. The method ensures that there is no discrimination on the part of the landlord when leasing the property from him.
Check credit report
There are many online services that check residents’ credit on behalf of homeowners. After receiving the credit report, homeowners should review it carefully and ask for an explanation if there are any delinquencies. The report will make it clear if the tenant has a history of paying bills late or has suffered bankruptcy.
Obtain personal information
When leasing commercial real estate for rent, landlords must request personal information from the tenant. Often during such an arrangement, tenants use credit and company information and not their own personal information. If the inhabitant is new to the business, it is the owner’s right to know if he can pay the rent in the event of the business closing. The personal information will also help landlords to know if the tenant has a criminal record or not.
Contact previous owners
Most applications ask tenants to fill in the name and contact information of their previous owners. However, owners tend to overlook it and don’t call previous owners for references. This is a big mistake, as a previous owner can provide valuable information that would not otherwise be available. Therefore, before renting it is essential to contact the previous owners of the possible occupant.
Get help from tenant screening companies
It is not always possible for a homeowner to do all the checking on their own. In such a scenario, they should seek help from tenant screening companies that do credit checks, reference checks, etc. Owners can make a decision based on the report of such companies.
The last part of the selection process should include a face-to-face interaction with the tenant. There are several things that cannot be communicated in an app or phone discussions. During such interactions, owners should study the tenant’s body language. This is a great indicator to know if the occupant is trustworthy or not.
Proper screening doesn’t cost homeowners a lot, but it pays huge dividends in the long run.