Can Owners Require a Pre-approval Before Showing a Rental Property?

Finding quality tenants for your rental properties is crucial in running a successful rental business. However, conducting showings, following up on leads, and facilitating applications can be a time-consuming process. For landlords without professional property management in Washington, DC, running to showings for applicants who are unqualified or not truly interested wastes valuable time. To combat this, should landlords require rental applicant pre-approval? Well, keep reading as we go over the benefits of rental application pre-approval and what this process looks like. 

Main Takeaways

• Landlords may use pre-screening before scheduling rental showings, but they should use consistent, objective criteria and follow federal, state, and local fair housing laws.
• Pre-screening can help landlords identify prospects who meet basic rental criteria before spending time on a showing, but it does not guarantee final approval.
• After a showing, landlords can use the full rental application and screening process to verify income, rental history, references, and other lawful qualification criteria.

What Does Pre-approval Mean?

Pre-approval for a rental property means that the prospective tenants have gone through a process that proves they may qualify to live there. However, it’s important to note that a pre-approval doesn’t mean that the tenancy is guaranteed. Instead, it’s a way for landlords to see which applicants have the best chance of qualifying to eventually occupy the home.  

Is Rental Application Pre-approval Necessary Before Showing a Property?

While it’s not necessary to pre-approve tenants before showing them a property, it’s a strategy that some landlords use to save time. After all, just because you have a lot of people interested in your rental property doesn’t mean they will all qualify to live there. 

Keep in mind that not all tenants pay rent on time, and not everyone will treat your property with the same respect you would. Experienced landlords have seen it all, from damaged property to losing out on monthly income due to nonpayment of rent. 

Landlords may choose to pre-screen prospective tenants before scheduling a showing. If you use this approach, establish objective rental criteria beforehand and apply the same process consistently to prospective renters.

Also, keep in mind that some jurisdictions impose additional requirements on tenant pre-screening. For example, Washington, D.C. housing providers must provide certain disclosures before requesting information or fees from prospective tenants as part of the screening process.

Next, let’s go over some of the biggest benefits of pre-approving tenants before showing a rental property. 

Benefits of Rental Application Pre-approval

As most landlords know, there are tons of benefits to pre-approving tenants. For example, asking prospective tenants appropriate pre-screening questions can help determine whether they meet your established rental criteria before scheduling a showing. Here are some of the other benefits of rental application pre-approval:

• Helps landlords focus their time on prospects who meet basic rental criteria
• Gives prospective renters a clearer idea of qualification requirements
• Creates a more consistent process for handling rental inquiries
• May reduce unnecessary showings for prospects who do not meet established criteria

What Does a Rental Application Pre-approval Look Like? 

Before you schedule a property showing with a prospective tenant, you should come up with a way to determine if they are qualified to live there. Some landlords even set up a pre-qualification stage before sending out a rental application. 

Typically, this consists of pre-screening questions and possibly a meeting with the tenants before they fill out an application. If you’re unsure of what screening questions you can ask a prospective tenant, here are a few suggestions. 

Pre-screening Questions to Ask a Tenant

• How soon are you looking to move? 
• How long have you been at your current residence, and why do you want to move?
• Do you meet our stated rental history requirements?
• Can you comply with a non-smoking rental unit? 
• How many occupants will be living in the unit? 
• Do you have any pets? If so, what kind and how many?
• Are you able to provide rental history or landlord references if required as part of the application process?
• Are you able to provide documentation showing that you meet our stated income requirements?
• Are you able to commit to at least a year-long lease? 

If a prospective tenant does not meet your established, lawful pre-screening criteria, you may decide not to move forward with a showing. However, landlords should apply the same criteria consistently to all prospective renters and ensure their questions and screening practices comply with applicable federal, state, and local laws.

What’s Next Once a Tenant Is Pre-approved?

Once you’ve gone through all the pre-qualifications you think are necessary to consider a prospective tenant, it’s time to move on to the next step. While it may look different for every landlord, typically, the next step involves your tenant filling out a rental application. After that, there are necessary steps to take before a tenant moves in, which include – 

• Setting Up a Property Showing
• Rental Application Process
• Signing a Rental Agreement
• Collecting a Security Deposit and First Month’s Rent
• Tenant Moves In
• Keeping in Contact With Tenants

Setting Up a Property Showing

Once a tenant is pre-screened or pre-qualified, the landlord can set up a property showing. During this showing, the prospective renter(s) can view the property, including the exterior and all the interior rooms and bathrooms.

Usually, this process is done with the landlord or with a property manager. This is a key opportunity for landlords to convert a pre-qualified prospect into an applicant ready to apply for occupancy. When you show a property, be sure to prepare the unit and make it look its best. For example, consider sharpening the curb appeal, cleaning the property thoroughly, making necessary upgrades, and ensuring safety throughout the unit.

Also, be ready to answer questions regarding the property itself and the surrounding area so the prospects get the most out of the time spent on their tour. Remember, tenants are also signing on to a professional relationship with you as the landlord, not just the property, so impressions matter. 

Rental Application Process

Once a tenant has answered the pre-approval questions and prequalified for the rental property, landlords can have them fill out an application. Many people think that pre-screening questions are the same as a rental application, but that’s not the case. 

Prospective tenants will provide more detailed information about their finances, rental history, and employment information during the application process. Landlords can then learn more about the tenant and verify that they are qualified to live in the rental unit. 

During this time, landlords can verify the information provided and evaluate the applicant according to their established rental criteria.

Signing a Rental Agreement

Once you’ve shown the property to a prospective tenant and they’ve decided they are interested in renting it, the next step is to go over the rental agreement. During this process, you’ll sit down with the tenant(s) and go over your expectations and specific lease clauses. 

When you go over a rental agreement with a tenant, it’s crucial to make sure they understand and are willing to comply with your terms. Additionally, expect to answer any questions or concerns regarding the property and rental policies. 

Collecting a Security Deposit and First Month’s Rent

Once a rental agreement is signed, the next step is collecting the security deposit and first month’s rent. Keep in mind that the amount you may charge for a security deposit varies state by state.

Security deposit limits vary by state and sometimes by local jurisdiction. For example, Maryland generally limits a residential security deposit to one month’s rent, subject to limited exceptions.

Landlords should check current state and local requirements before collecting a deposit. However, if a landlord charges more than permitted, the tenant may be able to recover up to three times the excess amount charged, plus reasonable attorney’s fees.

Tenant Move-In

After a tenant pays the security deposit and first month’s rent, they can start the move-in process. However, before a tenant occupies the unit, landlords should verify that all funds were received and the lease is signed.

In addition, it is essential to conduct a thorough move-in inspection. This form or checklist allows tenants to document any damages or irregularities that are already present before they move in. 

Once the form is filled out, tenants can move their belongings into the unit. 

Keeping in Contact With Tenants

Once your tenant is fully moved into the rental unit, it’s a good idea to connect and make sure everything is going well. Moving is a stressful time, and it is not uncommon for questions or issues to arise as tenants settle in. Thus, checking in shortly after move-in can help address these possible concerns early and exhibits great customer service. 

Next, let’s go over how property management can help you find new tenants and manage your rental business. 

FAQs About Rental Application Pre-Approval

Rental pre-screening can save landlords time, but it is important to understand where pre-screening ends and the full application process begins. Here are answers to some common questions.

Can landlords pre-screen tenants before a showing?

Landlords may use a pre-screening process before scheduling a property showing, subject to applicable federal, state, and local laws. Any criteria used should be objective, relevant to the tenancy, and applied consistently to prospective renters.

Is rental pre-approval the same as application approval?

No. Pre-approval or pre-qualification generally means that a prospective renter appears to meet basic rental criteria. The landlord may still need to verify information and complete the full application and screening process before approving the tenancy.

What can landlords ask during rental pre-screening?

Landlords can generally ask questions related to legitimate rental requirements, such as the prospective tenant’s desired move-in date, number of occupants, ability to meet stated income requirements, and willingness to follow property policies. Questions should comply with fair housing and other applicable laws.

Should landlords use the same pre-screening criteria for everyone?

Yes. Using consistent criteria and procedures can help create a fairer and more transparent screening process. Landlords should avoid changing qualification requirements based on an applicant’s protected characteristics. HUD identifies race, color, national origin, religion, sex, familial status, and disability as federally protected characteristics.

Does pre-approval guarantee that a tenant will be approved?

No. Pre-approval is only an initial step. A prospective renter may still need to complete an application and satisfy the landlord’s lawful screening criteria before receiving final approval.

How Can You Benefit from Property Management?

Running a rental business can be overwhelming, especially for landlords with multiple properties. Luckily, hiring a trusted property management company can be highly beneficial if you find yourself constantly running around from property to property. 

At Bay Property Management Group, our dedicated leasing professionals follow up on leads, conduct pre-screening, show units, and facilitate the application process – all while keeping owners informed every step of the way. However, once the property is occupied, our experienced team of resident managers takes over to oversee rent collection, maintenance, customer service, and so much more. If you’d like to explore all that professional rental management can offer you, contact BMG today.