I’m going to reveal to you some of the warning signs of what we call “High Risk Tenants.” Many experienced landlords have dealt with these types of tenants in the past and have developed an intuition or even a sixth sense to recognize these types of tenants and, in most cases, will go to great lengths to avoid them in the screening process.

You MUST avoid breaking the law here! Some of these tenants are in what is called a protected class. You cannot discriminate against them or the class they are in. You must find another reason to reject them.

Well, you’ve checked your credit, your references, and everything looks good. They seem like nice people, but something tells you there’s a problem. You just can’t point to what is yet. It is usually something that the owners have not considered a problem. So, here are a few to keep an eye out for.

Recent change in marital status

This is one of those protected classes noted above. As a landlord, you cannot discriminate against or because of marital status.

However, you can discriminate based on damage caused to the tenant or their guests on the property. One of the most volatile situations is when a husband and wife separate and one of them wants to rent a house that she owns.

A couple of scenarios come to mind and none of them are good.

1. Let’s say you rent from one of them and let’s say it’s the wife. She is there for three or four months and the couple work out their differences and decide to move back in together. Good for them, but bad for you the landlord. This means that you now have a vacancy. Each vacancy will cost you one month’s rent.

2. The stalker scenario. He/she may come in drunk, make a lot of noise, kick doors, etc. You get the idea. The police are called to the house, the neighbors are upset, and soon you are getting calls from the police and angry neighbors at all hours. None of this is desirable. You will probably have to evict the tenant and try to collect damages on top of the security deposits.

Some state laws even stipulate that a woman who is afraid of her ex-husband or boyfriend can move out without notice and without penalty.

We always require a one year lease on all properties we rent. This way, in the first scenario where the couple gets back together, they can at least receive their monthly rent payment until they find another tenant.

The second scenario is a bit more difficult. Most likely, this is not the first home the “wife” in this case has rented since the separation or divorce.

So make sure you always check previous owners, this can give you information in addition to “Marital Status” that will alert you to any potential or history of volatile behavior.

As a responsible landlord, you should also run a criminal background check in these cases. You may not encounter any problems; On the other hand, you may discover that one of the spouses has been arrested for domestic violence or something similar that can alert you to possible problems in the future.

You may need to rely on income amount, credit history, or some other criteria that is clearly outlined on the sheet you give to “ALL” applicants.

The ALL part of this is very important. If you don’t provide the same information and criteria to ALL applicants, then you can talk to the Fair Housing investigators.

Tenants who have never lived together before

This is a situation where two or more people want to be roommates, but have never lived together. They separated and worked together, but never lived together.

College students are the prime candidates here. This is almost always a bad situation for the owner. But you can deal with this one a bit easier than the first one we discussed.

You have the possibility of discrimination. What you want to do in this situation is require that “ALL” applicants meet your requirements to rent your property. If one of them cannot meet the requirements, then the whole lot is rejected.

If it is about two recently separated people, go back to the first about marital status.

Problems that can, or should say, WILL ARISE in 95% of cases are as follows:

People who go to parties or work together have a great time that way, but one of them is really lazy or has a girlfriend or boyfriend that the others can’t stand. They want their music to sound louder than what others like. And so on… Or… they let someone move in or out without their knowledge.

You, the owner, go to the door one day or knock and you don’t know the person and they don’t know you. The rent keeps coming in, but the occupants are no longer the ones who signed the lease.

This is covered in our lease addendum and should be in yours. “Nobody accepts that the people signed in the lease can reside or live in the property.” The problem for the owner is that he now lives there and he may have accepted the rent for the unrented part.

In some states, that can present a real problem getting them out. If you have knowingly accepted rent from a tenant, you have automatically accepted that tenant as a tenant. So the question is whether you knowingly accepted the rent.

The best defense you can mount is not to rent to them in the first place.

Recent job changes

If you receive a rental application with multiple job changes. Especially if they are in the last one or two years, you may have a problem on your hands.

Generally, people who move from one job to another in short periods of time are unstable in their jobs. They are probably just as unstable in their living arrangements and in most other parts of their lives as well.

Frequent job changes equals frequent changes of residence. Usually because it takes a little while to find the next job, so they can’t pay their rent and have to move or be evicted. They probably won’t be able to remember all of your addresses on the application.

That’s why it’s important that when you check the tenant’s references, you check the length of residence with the previous owner. In fact, the previous landlord may be more willing to give you this information than to say, “Was he or she a good tenant?”

The self-employed applicant

Self-employed applicants can cause you problems. In fact, in some circles self-employed means drug dealer or, with the current immigration problems, it could mean human smuggler.

These people may be called “Wholesalers” or “Suppliers”, even “Manufacturing Representatives”.

In any case, your income is usually always in a flow state. They trust their customers or clients to pay them for their income. If they don’t get paid, guess who else they don’t pay rent to?

This is what we do to check them.

We make them provide us with a copy of their tax return and profit and loss statement (Profit and Loss) that they provided to the IRS for their taxes. Look at the adjusted gross income. Not just taxable income.

This will give you a more accurate view of what they actually “take home” as payment. You’re a landlord, you know how that works. Sometimes things that are not 100% business expenses get written off.

Confirm that they do indeed work. Ask to see business cards and company letterhead.

(These should be readily available). Most entrepreneurs carry business cards with them to hand out at a moment’s notice.)

Special Note: With current technologies, it is quite easy to manufacture these types of documents, so dig deeper.

Look in business directories to see if they are listed. If not, ask them why? If they work from home, ask them why they are uprooting both their home and business. That is a monumental task as you may know.

You need to do your due diligence here. When they answer your questions, write it down and then check the answer. If they are leaving their current residence in unfavorable conditions, they may have already put together a good story for the next owner.

In conclusion, not all people in these categories will be bad tenants. However, most of the time they are. Just do your due diligence and really check things out. You’ll save yourself a lot of money and headaches when you do.