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background check on rental tenants

How important it is, in order to avoid sadness and pain and loss of money in the future, to run a thorough background check on rental tenants. Check their passport, details, get work references, bank references etc.

The importance of a thorough background check on a rental tenant
07 March 2011

It's no wonder that Spain is the country with the lowest amount of properties being rented out.  And why, you may ask, do I state that???  Well the simple reason is that in Spain the owner of any property has far less rights over his own property than the tenant, and if the owner has the bad fortune to admit a scoundrel into his property, well chances are that things are going to go quite badly from the date of entry onwards!!!

In Spain, the law states that if a rental contract is entered into for a property, that that tenant has the right, if he so wishes, to remain in that property for up to 5 years, so eventhough one tries to avoid this by making up a contract for the term of one year, eleven months or even six months, in reality it doesn't hold when examined by the law.  The tenant has the right of occupancy for up to 5 years whether he pays the rent or not!!

And on top of that, the owner has the obligation to make the stay of that tenant as comfortable as possible.  If the tenant does not pay the rent, well then that does not count as any reason for cutting off his electricity, water, gas or phone connections.  He hasn't paid you, but you have to continue making sure that he is comfortable and able to live in peace.  It doesn't even matter if you are out of work and that all the bills come to your own account.  If this is what was agreed at the beginning, and despite the fact that your tenant does not pay you back for the utilities that he has used, you have to continue paying them and you cannot cut any of them off!!!

Is this fair to the owner of the property???  Not on your Nelly it isn't, but there really isn't much that one can do either.  In a contract where it is stated that any misunderstandings will be sorted out in the judicial courts, this could mean an owner having to wait up to 2 or 3 years for the issue to be sorted out.  The courts are slow here in Spain , and as mentioned before the courts always take into account the rights of the tenant before the rights of the owner.

It is surely the most frustrating thing that any owner of a property can go through. And it also has to be remembered that most owners who have bought properties, have bought them with the idea of renting them out simply because they need to make some sort of a living.  They are probably over the age of 50 when no longer will any company employ them and even less now with the economic crisis.  They bought these properties as a means of safe guarding their retirement days when no other money would be coming into their bank account.  And then they have the bad luck to have admitted  a rougue into their property who decides that he not only does not want to pay the rent any more but no longer wants to be responsible for paying back any of the utilities such as gas, water, electricity etc either. 

Some property owners even buy properties with loans from the bank and use the rent that they get from their tenants in order to pay back the mortgage each month.  So what happens when a tenant refuses to pay the rent is that in most cases the property owner can no longer meet the mortgage payments and eventually loses their property altogether!!!  Tragic, unfair, frustraing and a whole load of other words come to mind to describe this sad event.

So we now come back to the title of this blog which is that it is just SO SO important to get a thorough background check on any prospective rental tenant for your product. 

Don't be eager to accept the first tenant that answers your advert.  Remember that if he answered it, a whole load more may answer it as well.

Don't be submissive.  This is YOUR property and it is up to you to be choosy and not the tenant.  It is up to you to decide whether you will allow this person to enter into your property and not the other way round.

Take on an assertive position.  Ask this prospective tenant for identity documents, work references, bank references and references from previous landlords.

If possible ask for a bank guarantee of one year.

Make your tenant set up a direct debit to his own account for all the utilities such a electricity, water, gas and phone.

Sign a contract made up by lawyers in a notary office.

Include in the contract that any problems arising will be sorted out by an arbitrator of your choice and not by any judicial court.  The reason for this being that an arbitrator can sort a rental problem out within three to six months instead of the  five years taken by a judicial court!!!

And finally, look at your prospective tenant straight in the eye and ask yourself whether you like the look of him!!  So often property owners feel as if they are at the mercy of the prospective tenants but it should never be that way.  This is your property and one which you worked hard to buy and own and so you have to be very very choosey as to who you let into it!!!!!!!!!!!!!!!!!!!

more articles of Amanda Ines can be read on  www.helium.com/



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