How to Screen Tenants Effectively: A Landlord's Step-by-Step Guide

A bad tenant can cost you $5,000 to $30,000 in lost rent, legal fees, property damage, and [eviction costs](/blog/how-to-handle-eviction). A good tenant pays on time, takes care of the property, and stays for years. The difference between the two almost always comes down to screening.

Tenant screening isn't complicated, but it needs to be thorough, consistent, and legal. This guide walks you through the entire process—from the first inquiry to the signed lease.

Why Screening Matters More Than Anything Else

According to TransUnion's rental screening data, the average eviction costs landlords $3,500 in legal fees and lost rent alone—not counting property damage or the cost of re-leasing. The National Apartment Association estimates the full cost of a bad tenant at $10,000 to $25,000 when you factor in everything.

Compare that to the cost of screening: $30 to $55 per applicant, plus a few hours of your time. Screening is the highest-ROI activity in [property management](/blog/property-management-complete-guide).

Setting Your Screening Criteria Before You List

Before you advertise your property, write down your screening criteria. This matters for two reasons:

1. Consistency protects you legally. Applying the same criteria to every applicant is the foundation of fair housing compliance.
2. Clear criteria speed up the process. You'll spend less time on applicants who don't qualify.

Recommended Minimum Criteria

Credit score: 620+. This is a reasonable floor for most markets. Applicants below 620 statistically have higher rates of late payments and defaults. In competitive markets, you can raise this to 680+. In softer markets, you might accept 580+ with additional security deposit.

Income: 3x monthly rent. If rent is $1,500, the applicant (or combined applicants) should earn at least $4,500 per month in gross income. This is the industry standard ratio. Some landlords use 2.5x in high-cost markets.

Rental history: 2+ years with no evictions. You want to see a track record of paying rent on time and leaving properties in good condition. First-time renters can qualify with stronger income and credit.

Background check: No felony convictions in the past 7 years. HUD guidance says blanket bans on all criminal history may violate [fair housing law](/blog/landlord-tenant-law-basics). Focus on convictions (not arrests) that are relevant to property safety and within a reasonable timeframe.

No prior evictions. An eviction on record is the single strongest predictor of future problems. Most landlords treat this as an automatic disqualifier.

Put It in Writing

Document your criteria in a written screening policy. Include it with your rental listing or application packet. This transparency protects you in discrimination claims and helps applicants self-screen.

Step 1: Pre-Screening on the Phone or by Message

Don't schedule a showing for every inquiry. A 5-minute pre-screening call saves hours.

Ask these questions:

• When are you looking to move in?
• How many people will be living in the unit?
• Do you have pets? (If your property has pet restrictions)
• What is your combined monthly income?
• Have you ever been evicted or broken a lease?
• Can you pass a credit and background check?
• Why are you moving from your current place?

Listen carefully to the answers. Hesitation on the eviction question, inability to state income, or a vague reason for moving are yellow flags worth noting.

Important: Do not ask about race, religion, national origin, sex, familial status, disability, or any other protected class. Keep questions focused on financial qualifications and rental history.

Step 2: The Property Showing

Use the showing as an additional data point. You're not just selling the property—you're observing.

Note:

• Did they arrive on time?
• Did they ask thoughtful questions about the lease terms, utilities, and neighborhood?
• Do they seem genuinely interested, or are they just browsing?

Don't make decisions based on appearance, accent, or gut feeling. These are exactly the kinds of subjective judgments that lead to fair housing complaints.

Step 3: The Rental Application

Every adult (18+) who will live in the property should complete a separate application. Your application should collect:

• Full legal name and date of birth
• Social Security number (for credit and background checks)
• Current and previous addresses (past 3 years minimum)
• Current and previous landlord names and contact information
• Employer name, position, and contact information
• Monthly gross income
• Emergency contact
• Authorization to run credit and background checks

Charge a non-refundable application fee to cover your screening costs. The typical range is $30 to $75, depending on your market and local regulations. Some states cap application fees—check your local laws.

Application Red Flags

• Incomplete applications (missing landlord info, no employer contact)
• Reluctance to provide Social Security number
• Cash-only income with no [documentation](/blog/heloc-documentation-requirements)
• Gap in rental history with no explanation
• Moving frequently (3+ addresses in 2 years)

These don't automatically disqualify someone, but they warrant closer investigation.

Step 4: Credit Check

A credit report tells you how an applicant handles financial obligations. You're looking at:

Credit score. A FICO score of 620+ indicates reasonable financial responsibility. Below 580 suggests a pattern of missed payments or defaults.

Payment history. Look for late payments, especially on housing-related accounts (previous rent if reported, mortgage, utilities). Recent late payments matter more than old ones.

Outstanding collections. Medical collections are common and less concerning. Utility collections and previous landlord collections are serious red flags.

[Debt-to-income ratio](/blog/dti-ratio-explained). If someone earns $5,000/month but has $2,000/month in debt payments, adding $1,500 in rent leaves very little margin. Consider total obligations, not just income.

Bankruptcies. A Chapter 7 bankruptcy from 5+ years ago with clean credit since is less concerning than a recent Chapter 13 repayment plan.

Where to Run Credit Checks

• TransUnion SmartMove: $25–$42 per applicant. Tenant-initiated, so you never handle their SSN directly.
• Avail: $30 per applicant (or free if tenant pays). Includes credit, background, and eviction history.
• RentPrep: $21–$38 per applicant. Offers both tenant-paid and landlord-paid options.
• Experian Connect: $24.95 per report. Direct from the bureau.

Step 5: Background Check

A background check reveals criminal history and, depending on the service, sex offender registry status. Important guidelines:

Check convictions, not arrests. Arrests without convictions should not be used against applicants. Many states explicitly prohibit this.

Consider relevance and recency. A drug possession conviction from 12 years ago is very different from a violent felony from last year. HUD guidance requires individualized assessments that consider the nature of the crime, time elapsed, and evidence of rehabilitation.

Be consistent. Apply the same criminal history criteria to every applicant. Selectively checking or applying criminal history standards is a fair housing violation.

State and local laws vary. Several states and cities have "ban the box" laws that restrict when and how landlords can consider criminal history. Check your jurisdiction.

Step 6: Eviction History Check

An eviction search checks court records for previous eviction filings. This is separate from credit and criminal checks.

Most screening services include eviction history, but coverage varies by state and county. Some jurisdictions don't report eviction data electronically, so a clean eviction report doesn't guarantee no prior evictions.

This is why verifying with previous landlords is essential—it catches what databases miss.

Step 7: Income Verification

The 3x rent rule means nothing if you don't verify income. Applicants can (and do) lie on applications.

For W-2 employees:

• Request the two most recent pay stubs
• Call the employer to verify employment status, position, and length of employment
• For extra verification, request the most recent W-2 or tax return

For self-employed applicants:

• Request the two most recent years of tax returns (full returns, not just the first page)
• Request 3–6 months of bank statements showing consistent deposits
• Consider requiring a larger security deposit if income is irregular

For applicants using non-employment income (Social Security, disability, retirement, alimony):

• Request benefit award letters, bank statements, or court orders showing the income amount
• Note: You cannot reject someone because their income comes from Social Security, disability, or other lawful sources. Only the amount matters.

Step 8: Landlord References

This is the step most landlords skip—and the one that matters most. A previous landlord can tell you things that no report will reveal.

Contact the landlord before the current one. The current landlord might give a glowing review just to get rid of a problem tenant. The landlord from 2–3 years ago has no motive to lie.

Ask these specific questions:

1. Can you confirm that [applicant name] lived at [address] from [date] to [date]?
2. Did they pay rent on time consistently?
3. Were there any [lease violations](/blog/dealing-with-problem-tenants) or complaints from neighbors?
4. Did they leave the property in good condition?
5. Did you return their full security deposit?
6. Would you rent to them again?

Question #6 is the most revealing. A hesitation or qualified answer ("Well...") tells you everything.

Verifying That You're Talking to the Actual Landlord

Some applicants list friends or family as their "landlord." Verify by:

• Cross-referencing the name and phone number with property tax records (available online in most counties)
• Checking that the phone number matches public listings
• Asking for the property management company name and looking it up independently

Step 9: Making the Decision

Score each applicant against your pre-established criteria. If multiple applicants qualify, choose based on objective factors: highest credit score, longest stable rental history, or first qualified application received.

Document your decision. Note why each rejected applicant didn't meet your criteria. This documentation is your defense if a rejected applicant files a discrimination complaint.

Adverse Action Notices

If you reject an applicant based in whole or in part on information from a credit report or background check, federal law (the Fair Credit Reporting Act) requires you to:

1. Notify the applicant of the denial
2. Provide the name and contact information of the screening company
3. Inform them of their right to dispute the report and obtain a free copy

This applies even if the applicant also failed other criteria. Most screening services provide adverse action letter templates.

Fair Housing: What You Cannot Do

The Fair Housing Act (42 U.S.C. §§ 3601–3619) prohibits discrimination based on:

• Race or color
• National origin
• Religion
• Sex (including sexual orientation and gender identity per 2021 HUD guidance)
• Familial status (families with children under 18, pregnant women)
• Disability

Many states and cities add protections for source of income (Section 8 vouchers), marital status, age, student status, veteran status, and more.

Specific things you cannot do:

• Advertise preferences ("perfect for young professionals," "no kids")
• Ask about disability, medication, or medical history
• Refuse to rent to families with children (unless the property qualifies as senior housing)
• Apply different screening criteria to different applicants
• Steer applicants toward or away from certain units based on protected characteristics
• Refuse to make reasonable accommodations for disability (emotional support animals, accessible modifications)

Screening Checklist Summary

Use this checklist for every applicant:

• Pre-screening call completed
• Written application received from every adult occupant
• Application fee collected
• Credit check run (score, payment history, collections, bankruptcies)
• Background check run (criminal convictions, sex offender registry)
• Eviction history check run
• Income verified (pay stubs, tax returns, or benefit letters)
• Current employer contacted
• Previous landlord #1 contacted
• Previous landlord #2 contacted (if available)
• Photo ID verified against application
• Decision documented with specific reasons
• Adverse action notice sent (if applicable)

FAQs

How long does tenant screening take?

From application to decision, most screenings take 2–5 business days. The credit and background checks themselves return within minutes to 24 hours. The bottleneck is usually reaching previous landlords and employers by phone.

Can I deny a tenant for bad credit?

Yes, as long as you apply the same credit standard to all applicants. Credit score is not a protected class under the Fair Housing Act. However, if your credit policy disproportionately impacts a protected group and isn't justified by business necessity, it could face a disparate impact challenge.

Should I accept Section 8 vouchers?

In many states and cities, you're legally required to accept Section 8 (Housing Choice Vouchers) under source-of-income discrimination laws. Even where it's not required, Section 8 can be beneficial: the government pays a portion of rent directly to you, and tenants tend to stay longer because they don't want to lose their voucher.

What if an applicant has no credit history?

No credit history isn't the same as bad credit history. Consider alternative indicators: steady employment, strong landlord references, willingness to provide a co-signer, or a larger security deposit. Many young adults, immigrants, and people who've always paid cash have no credit file.

Can I charge a non-refundable application fee?

In most states, yes, but the fee must be reasonable and reflect your actual screening costs. Some states (like [California](/blog/california-heloc-guide)) cap the fee—in California, it's $62.02 as of 2025, adjusted annually for CPI. Check your state and local regulations.

How do I handle multiple qualified applicants?

Choose based on objective criteria: first qualified applicant, highest credit score, strongest rental history, or highest income-to-rent ratio. Document your selection method and apply it consistently. Avoid subjective "gut feeling" decisions.

Final Thoughts

Tenant screening is the most important 3–5 hours you'll spend as a landlord. A rigorous, consistent, well-documented screening process keeps bad tenants out, keeps you out of court, and gives good tenants confidence that they're moving into a well-managed property.

Don't cut corners. The $40 you spend on a credit check is the cheapest insurance in real estate.

Related Articles

• Property Taxes Explained: How They Work and How to Reduce Them
• How to Challenge Your Property Tax Assessment (And Win)
• How to Get a 700 Credit Score: Step-by-Step Plan