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Why Property Managers Must Verify Income

Charleston property management companies know that verifying income is essential to finding the right tenants to lease homes. Skipping verifying income can be tempting if you’ve already run a credit check and the prospective tenant has cash on hand for the deposit and first-month rent. While keeping your properties occupied is the goal of Charleston property management companies, leasing to a tenant that cannot afford to live in the home can become your worst nightmare.

How Much Income Does a Tenant Need?

The general rule is that your rent should only be one-third of your income. You will need to verify that your tenant makes at leastthree times the amount of rent in gross income annually. Keep in mind that some tenants may not have a traditional source of income that meets these requirements such as a salaried job; however, Charleston property management companies can also consider a co-signers income as well as student loans or grant money that the tenant uses for their expenses.

How To Verify Income

Most people have a traditional job that offers them a paycheck. Charleston, property management companies, can take copies of the paystubs to determine if the tenant meets the income requirements. If the tenant is self-employed, cash or commission-based employee, retired or a student, you will need to verify income in other ways such as:

  • Tax return
  • Annual income statement
  • Employer verification
  • W2 or 1099
  • Offer letter
  • Retirement, SSI, SSD, or Pension statements
  • Bank statements

If a tenant cannot provide you with some proof of income, a red flag should be raised. Never make exceptions and waive the evidence of the income portion of the application.

If you need help finding the perfect, qualified, tenants for your rental homes in Charleston contact Scott Properties today!