Ask Applicants' References Seven Key Questions

If you, as a site owner or manager, screen applicants yourself, one of the most important steps you take is to contact applicants' current and prior rental references.

References' evaluations are valuable in helping you decide whether to rent a tax credit unit to an applicant. But rental references are often reluctant to fill out forms, so you might find it easier to call them to get the information you need. To get an informative reference over the telephone, you need to ask the right questions and keep a record of the answers.

Cheryl McMillon, a 25-year veteran of affordable housing management, has given us seven key questions you should ask rental references to help you get all the information you need to make the right decision about an applicant. With her help, we've prepared a Model Form: “Rental Reference Questionnaire,” which you can use both as a script for your questions and as a record of the answers you get. You can photocopy the form and use it when you speak to rental references about applicants to your site.

Use Questionnaire to Interview Rental References

Using a standard interview questionnaire makes it more likely that you will get the information you need to evaluate—and, if necessary, reject—an applicant.

For example, your screening criteria may state that you will reject applicants who failed to pay rent three times within one year at another site. The questionnaire ensures that you and your staff ask the right questions about every applicant. You don't have to worry about inexperienced staffers forgetting important questions or asking inappropriate ones.

Also, you will have a written record of the reference's answers. That way, if you reject an applicant based on a prior site owner's information, and the applicant claims that the rejection was discriminatory, you will have the reasons for the rejection spelled out in the questionnaire.

Instruct your staff to use the questionnaire whenever they interview applicants' rental references. Tell them to be sure to ask all of the following questions—and only those questions—when checking. However, site staff may elicit more detail regarding any of the reference's answers to a particular question. Instruct your staff to write down the rental reference's answers to each question as completely as possible.

Remind staff not to send this form to the rental reference. Also, have staff use a separate form for each rental reference. (See these instructions at the top of the questionnaire in our Model Form.)

Ask Seven Key Questions

Here are seven key questions you need to cover in your Rental Reference Questionnaire.

1. Is the reference related to the applicant? Many applicants name as a prior rental reference a friend or relative with whom they stayed. If the reference is a relative, the information you get may be biased or even false.

2. Did the applicant give proper notice? Find out whether the applicant gave proper notice before terminating the lease. This is a way of assessing whether the applicant is a risk for skipping out at your site. Also find out the move-in and move-out dates, to confirm information that the applicant has given you. An applicant who lived at a prior address for several years without any problems would probably be a good resident at your site, too.

3. Does the applicant have a good payment history? Find out what the applicant's monthly rent payment was and whether he paid it on time. If he made late payments, ask for specifics—how often rent was paid late and how late it was. Did the applicant ever bounce a check? The most important question about payment history is whether the applicant still owes any rent or other charges. If he does, he's probably a bad risk as a resident.

4. Did the applicant ever damage the unit or common areas? Applicants who damage units or common areas are a threat to your bottom line. Ask whether the applicant ever caused damage and whether the reference withheld any of the applicant's security deposit as a result. Also, ask about the nature of the damage.

5. Did the applicant ever violate the lease of community rules? Find out whether the applicant broke rules by, for example, having unauthorized guests, disturbing other residents, or committing crimes. And ask whether the reference has any records of noncompliance on file, such as noise complaints or police reports. Also, find out whether the reference ever tried to evict the applicant and, if so, why.

6. Did the applicant have a cosigner, guarantor, or roommate? The answer to this question may help explain a bad reference or apparent inconsistencies in an application. An applicant may get a bad reference because of the conduct of roommates or other third parties.

For example, a roommate may have been evicted because she committed a crime. Since the applicant could not afford the unit alone, she had to move out, too. Or a pair of applicants seeking to rent a unit as roommates may submit rental references for units that they shouldn't have been able to afford. But they may have had cosigners or guarantors who enabled them to rent those units.

7. Would the reference rent to this applicant again? This is the only subjective question you should be asking. And you will be seeking an explanation; it will help you get an idea of the reference's overall opinion of the applicant.

EDITOR'S NOTE: Don't rely solely on the applicant's current rental reference. The current reference may give the applicant a glowing evaluation just to get a bad applicant off his hands. Get information from at least one other prior rental reference, too.

It's also necessary to get the applicant's signed release before seeking information from third parties. Almost all rental applications today have such a release. The release can protect you from a claim by the applicant that you have violated his privacy by seeking confidential information.

Insider Source

Cheryl McMillon: Property Manager, Rampart Apts., 1700 Village East Blvd., Port Arthur, TX 77642; (409) 963-2185; camcmillon@sbc-global.net.