As property owners and real estate investors, being able to assure that we will be generating money and continue on raking in profit with the least energy and time spent as possible. However, just because we want to go through the process of being able to find tenants as fast as we can, it does not mean we can skip the standard operation procedure of scanning our potential tenants with scrutiny.
As real estate investors, we have to make sure we are getting the right amount of money back for our investment which may be an apartment or a house, therefore, truly knowing the history and the paying habit of the potential tenant are the utmost priority.
So what is Credit history?
Credit history is basically a record of a person’s ability to repay his or her debt, this record will show you how responsible that person is when it comes to being accountable for his or her spending and being able to pay back. This credit history will also show you how much this person still owes, the amount of used available credit, whether or not the bills were paid on time or it was late and etc.
Discovering about their credit history is not an invasion of privacy, this is needed when it comes to real estate. Just as in job interviews wherein the Human Resource personnel would call one’s previous department head for any necessary background on the interviewee to see if he or she is being true to his or her data on the resume and if he or she has a bad record on the previous company. By learning and knowing about your potential tenant’s credit history, you will be able to dodge a bullet of future damage such as your tenant not being able to pay his or her monthly rent which will cause a hassle on your part as you have to take care of taxes and other utility bills for your property.