Costs Associated with a Tenant Background Check

A tenant background check is a procedure that allows landlords to screen their potential tenants. By screening their tenants, landlords can reduce the likelihood that their tenants will default on their rent or be involved in criminal activities. Tenant background checks are usually made up for two parts - credit check and criminal history check. In many cases, it will include rental history check. If landlords have the means and the time, they may opt to do more detailed background checks that include things like eviction records, national warrant lists and terrorist watch lists. There are a number of tenant background check companies landlords can choose from. Each offers different types of services for different prices. This document will help to explain what kind of options landlords have available.

Background Check Basics

Different states have different laws on what a landlord is or isn't allowed to check. In every state, a background check cannot proceed unless the landlord has the tenant's explicit authorization. The tenant will have to fill out an application, sign it and date it. While potential tenants have a right to refuse to authorize the credit check, landlords have the right to refuse to rent to tenants that do not allow a background check.

As mentioned before, the cost of background check varies, depending on the company and the extent of the background check. Some companies will offer several different types of background check in one package while others will specialize in one particular aspect. Generally speaking, the less detailed the background check is, the cheaper it will be. The cheapest ones can be under $20, while the more expensive ones can run up to $100 or more. The landlords can mitigate the costs of the background check by charging an application fee. However, the application fee shouldn't be too excessive - anything over $60.00 may scare tenants away.

Credit Check

Credit check gives landlords insight into their potential tenant's credit history. The most basic credit checks will look at the credit score. Others will go into more detail, examining things like his or her credit history of bankruptcies, defaulted loans and foreclosures.

The credit checks will require the tenant's social security number, so landlords must be sure to get it before submitting it.

Criminal History Check

Criminal history check involves looking up a potential tenant and seeing if he or she has a criminal record. It the potential tenant has a history of criminal activity; it will show what they were and when they occurred.  It is worth noting that the criminal history check will only reveal crimes that the tenant was actually convicted of rather than the crimes he or she may have been involved in. Criminal history checks will usually require the tenant's driver’s license number or social security number.

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