In most higher end real estate investing markets screening tenants is a very direct and simple process. You largely focus on credit score and income, and there’s a surprising amount of generic information out there on how to do those things.
But if you invest in a lower end market, or neighborhood class, things get a bit more nuanced. You can’t just look at the basic tenant screening criteria.
The vast majority of my rental portfolio is in C Class neighborhoods of Detroit. And I’ve managed to have some pretty amazing luck with my tenants.
Yes, I’ve had a couple evictions.
Do this long enough and you’ll have to go through that in any market. But most of my tenants have been with me for 5 or more years.
That’s phenomenal!
And over the years I’ve come up with a basic tenant screening process that I believe works quite well.
In this article, I’ll walk you through my exact process for how to screen tenants—step-by-step—to help you avoid costly mistakes and keep your cash flow consistent.
Let’s get into it!
Step 1: Set Your Tenant Criteria
Before you do anything, you need to know what type of tenant you’re looking for and what’s most important to you.
Start by defining your ideal tenant profile. This means setting clear, non-negotiable criteria for applicants, like income level, rental history, and credit score.
For me, credit score is the least important factor.
I tell prospective tenants that I “like to see at least a 5 in front of it,” meaning their credit score has to be in the 500’s or better.
Yep, that’s not a high bar!
Instead of credit being my main factor, I prioritize income stability and rental history.
I am very strict about two main criteria: evictions and income.
Evictions Are My Number One Tenant Screening Criteria
Any past eviction is an absolute deal breaker for me, regardless of whether the process was completed or simply filed and resolved without an actual eviction done.
I’ve had many applicants assure me they’ve never had an eviction, only to discover otherwise during a background check.
I don’t accept any stories or excuses—it’s just not worth the risk.
Income Is Also Extremely Important
When it comes to income, I require that tenants make at least 3x the rent.
I don’t count Social Security Income (SSI) or disability as part of this income requirement, as I prefer to see consistent, earned income.
Having a well-defined tenant profile from the outset helps make the screening process faster and reduces bias.
Once you know what you’re looking for and what your dealbreakers are, it’s much easier to get started with the actual tenant screening and selection process.
Step 2: Fielding Tenant Applications & Pre-Screening
My tenant selection process starts with an online application.
I create a listing for the rental on platforms like Zillow and Facebook Marketplace.
From there, when I receive an inquiry, I simply copy and paste a short message that directs them to my online application.
This message makes it clear that there is no application fee, but if we decide to move forward, there will be a fee for the background and credit check.
Most people will NOT fill out the application, which is actually part of the screening process.
I need applicants who are willing to follow directions and put in the effort.
Sometimes, people will call me directly, and I’ll provide them with the application link, but I stick to my process.
When posting the rental, I receive hundreds of messages, so I prepare myself for 1-2 days of lower productivity as I manage all the responses.
By having this initial step be largely automated and online, I can filter out applicants who aren’t serious or aren’t willing to go through the steps.
It saves me time and helps identify those who are actually a good fit.
Once I receive an application, I look at whether they meet the basic criteria—specifically income and any past evictions.
If they meet these, I move on to the next steps.
I’ve learned over the years that being thorough in the pre-screen saves me a lot of trouble down the road.
Most of my tenants have been with me for 4-5 years, and that’s largely because I take the time to find the right fit from the beginning.
Step 3: Showing The Property
Once I’ve identified promising applicants, I schedule a time for them to see the property.
I set up one day and block off a specific time for showings, inviting 3-5 applicants who have made it through the initial screening.
This allows me to show the property to multiple interested parties at once, saving time and creating a sense of urgency.
Often, applicants will overlap and see each other viewing the home, which adds a competitive element and encourages them to act quickly.
I also require each applicant to confirm a specific time they will be at the property. If they flake or try to change the time at the last minute, it’s a red flag for me that they might not be dependable as a tenant.
The idea is for applicants to get a clear sense of the house, the neighborhood, and the surrounding area.
I want to ensure they genuinely like the place before moving forward with background and credit checks. This step helps confirm that they’re committed and that the property is a good fit for them.
Step 4: Conducting A Background And Credit Check
At this stage, I’m not running background and credit checks for everyone—only for those who loved the home during the showing and want to move forward.
Even then, I start with the most qualified applicant first.
The prospective tenants pay for this step, and I make sure to communicate clearly that I don’t want to waste anyone’s money.
I remind them that this should be a formality—at this point, they should have already disclosed everything to me, and there should be no surprises (like an eviction).
You’d be shocked by how many people reassure me at this stage only for surprises to come up on these checks that end up disqualifying them.
If this happens, I give them the bad news over the phone and then move on to the next qualified applicant.
Most of the time, however, I’m able to find a suitable tenant during this stage without too many issues.
For the background check, I use services like TransUnion’s SmartMove. These platforms are reliable and make it easy to see the full picture, including criminal history if applicable.
Again, I don’t weigh credit scores heavily, but I do pay attention to red flags like late payments.
Applicants with large outstanding debts are also concerning.
Sometimes there are explanations for these things. And I’m happy to have a discussion with the prospective tenant and hear them out.
Step 5: Verifying Employment, Income, And Rental History
I no longer put much emphasis on verifying employment, income, or rental history.
Why?
It’s difficult and/or not really dependable.
For income, I’ve found employers make you jump through a bunch of hoops that are difficult for the mom-and-pop landlords to navigate.
Either that, they simply won’t give much information.
When it comes to rental history, if I even bother checking this, I’m never calling their current landlord.
Always call the previous one!
The current landlord is not incentivized to tell you the truth.
Think about it… If the prospective tenant is a good one, they may not want to lose them. If they are a poor tenant, their landlord may sing their praises in hopes of them moving out.
While I’d love to think people are honest, I can’t simply overlook the misalignment of incentives here.
Overall, when it comes to verifying employment and income, I’m largely relying on my gut and the interactions I’ve had with the prospective tenant at this point, as well as their background and credit checks.
Employment should be showing up on these checks as well.
I’m not saying you shouldn’t be doing these things—verifying employment and rental history is definitely important. I’m just sharing what I tend to do and what’s worked for me over the years.
Step 6: Making The Decision
Making my decision is generally pretty easy as long as I followed my process.
I simply work from the first most qualified applicant that’s already viewed the home.
As long as their background and credit checks come back as expected, the house is theirs and we move on to signing a lease.
Where this might get difficult is if everyone that saw the house either no longer wants to move in or fails the final screening process.
That sucks, and I’ve been there.
The temptation to bend your rules and move forward with a mediocre tenant is real. But you must avoid doing that!
When this happens I simply re-run my process and consider lowering the rental amount to attract stronger applicants.
It’s not fun, and it’s a lot more work. But it’s necessary for success.
How To Screen Tenants Conclusion
Screening tenants in C-class neighborhoods may not be straightforward, but with a well-defined process, it’s absolutely manageable.
Some people think that C-class tenants aren’t good or that you can’t find strong tenants, but I disagree.
I’ve had a lot of success with my process, and I openly share my track record here.
By sticking to the criteria that matter most—income stability and avoiding past evictions—you can improve your chances of finding great tenants.
This approach has saved me countless headaches and has helped ensure that most of my tenants stay long-term, keeping my cash flow steady.
If you’re in a similar market, I hope these steps help you navigate tenant screening with more confidence.