Tenant Screening?

Full disclosure: I work for a tenant screening company. I'm asking this because we're trying to improve our product base to cater to larger property management companies. Moderators, if this thread is inappropriate, I apologize profusely - please feel free to remove it.

So, folks: what do you look for in a tenant screening company?

I don't want to lead the discussion too much, but I'm definitely interested in understanding the kind of reports you find most useful, the features you enjoy the most (i.e., ability to receive reports online, availability of decision-making engines rather than relying on personal report interpretation, etc.), the kind of service you expect (i.e. product training, live 24-hour help, etc.), that kind of thing.

I really appreciate everyone's responses - thank you!

I may be alone here with my stingy supervisors, but I somehow doubt it. This came up earlier this year when our credit report costs jumped from $3 to $20 each. For the record, we're owner managed, we've got 862 units across 37 communities, so we're not huge, but we're not tiny either.

Basically, I have no budget here in the leasing department. I am the only in-house agent, and I can spend absolutely nothing of the owner's money to get my job done. I close just over 150 leases per year and our local 3rd party agencies bring in another 100 or so.

In 2005 when I started with the company, I forced them to start running credit checks. At the time they only approved credit checks for commercial applicants. After taking 24 bids on credit reports, they took the most illegible but cheapest option from a vendor in Canada. The reports cost us just under $3 each. Positive results saw the background checks expanded to all residential applicants in 2007.

This year we were informed that costs for credit checks were going up to $20 per. We left the vendor and found a different one with even worse formatting for $4 each.

We also do sex offender searching (free online), OFAC searching (free online), eviction docket searching (free for 70% of counties online). Our credit check vendor offers all of these searches for a fee. Paying to have them done would take 20-30 minutes off of each app for my workload. It is not worth the cost to my boss.

That being said. We looked into decision-making engines and don't like them. We do not trust them at all - I can read a credit report and we have learned already what red flags to look for. We absolutely must be able to get reports online, instantly, 24 hrs a day. Basically, other than that, I don't care as long as it's cheap. There are many companies that I wish I could have used based on the quality of their reporting, but unfortunately I am constrained by owners who take the Hawaii 5-0 approach to background checks.

We just did a post about tenant screening over on the 4 Walls Renters blog: www.4walls.us/wordpress2/?p=24

Background checks seem more indicative than credit checks, based on the current economic situation.

Hi Kay - out of curiosity, do you collect a screening fee from your applicants? Most properties in my area request a screening fee of anywhere from $20 - $40 to screen their potential tenants; it's legal for them to charge either the "cost of business," i.e. the cost of the report itself plus any necessary, defensible overhead, or $42.61 (or something like that), whichever is cheaper. I paid $35 to be screened for the property at which I currently live. If management isn't willing to fork out for a decent screening service - and we all know times are tough, so I understand wanting to pinch pennies! - maybe you should look into screening fees.

That said - it must be tough being the only in-house agent! You must be a superstar to be keeping on top of everything your managers ask of you. Keep on keepin' on, and thank you for answering my little survey!

Ellen - that post is absolutely spot-on. We have landlords ask us all the time about credit scores; they want to know if this or that score is average, or normal, and it's just so hard these days to know what constitutes a mean score. It'll especially depend on where they're located, because obviously some areas have been hit harder than others by the recession - we usually end up telling them that while the score is important, their payment history and public records are where it's at. If they've got a good history of having paid and maybe have a blip or two that they can explain, that's one thing - if they've got a solid record of bad debts and accounts closed adversely on top of a civil judgment or two, that's quite another! Thanks for sharing

Yes, we do collect a screening fee, but we are only allowed to spend a small fraction of it outbound.