How to Minimize Screening Risk
Digested from Property Management Insider
If you want to reduce the risk of liability, and keep heads in beds, follow these tips.
Resident screening comes with many risks. To reduce them, owners and managers should set rental criteria for each community that matches their business objectives, according to Property Management Insider’s Philip Christian.
“One size doesn’t fit all,” Christian writes. “Screening criteria should be suited to the unique needs of each community in your portfolio. Tailor your criteria to meet market conditions at the individual community level or across regions.”
It also helps to use identity verification to know who the applicant is and to automate the process.
“Use automatic approvals based on your company’s rental criteria to simplify the move-in process and reduce individual decision-making, thereby reducing fair housing violation risk,” Christian writes. “Reserve manual approvals for borderline applicants and restrict the ability to perform them to authorized users.”
That said, apartment operators should set considerations for unique credit scenarios.
“… you may want to make special considerations for applicants that have otherwise sterling credit, such as those marred only by a mortgage in default or past foreclosure,” Christian writes.