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• Pension or other retirement income - Verify pension or retirement income through a pension statement or through bank statements.
• Bonus, Commission, and Incentive Payments - Applicants should be able to provide proof of income from these sources but you may want to see more than two or three months of overall income in order to determine how steady their income is over time.
• Self-employment Income - Freelancers and contractors may have income from a variety of sources. It may be a good idea to check several months’ worth of bank statements to ensure that they have steady income throughout the year.
• Income from worker’s compensation, insurance compensation, severance pay, or court-awarded compensation - These can be verified through documentation from the court or company making the payment.
• Section 8 or Other Vouchers – Failure to include the value of Section 8 or other housing vouchers is discriminatory, and subject to fines and penalties in California and many local jurisdictions throughout California.
While you can use any or all of these types of income to count toward your applicant’s income, you will want to consider how reliable this income is in terms of long-term compensation. For example, while Social Security or pension benefits would be the same month after month, severance pay or a bonus payment may constitute a one-time influx of cash. You will need to look for ongoing income rather than limiting yourself to an income assessment based on a single, non-repeatable event.
HOW CAN YOU ENCOURAGE ON-TIME RENT PAYMENTS?
Once you have approved and onboarded a renter,
there are a variety of strategies that you can use to encourage on-time rent payments. Consider the following options:
• Streamline the rent payment process with an automatic payment option and monthly reminders sent to your renter’s email or phone. When rent payments are automated, they become non-negotiables and lead to greater consistency.
• Send out additional reminders as needed, especially if the first of the month falls on a weekend or holiday. Let tenants know where and how they can pay their rent to ensure that it is recorded as an on-time payment.
• Make sure that your expectations regarding rent payments are clear to tenants both during onboarding and throughout the rental term. Provide a tenant handbook, maintain a website with frequently asked questions, or maintain an online library of information in written or video form so that tenants can refer to it on a regular basis.
• Communicate and enforce late fees when rent is not paid on time. When tenants are aware that you are serious about their on-time obligations, they will become more serious about them as well.
• Consider offering incentives such as rent discounts or credit bureau reporting to encourage on-time rent payment. This positive reinforcement can help your tenants to see the upside of their on-time payment and take it more seriously.
Aside from these strategies, remember that communication is an essential part of staying in the loop with renters. If a tenant loses his or her job or experiences a significant financial hardship, you are better off keeping the lines of communication open so that they feel able to come and talk to you rather than avoiding you and falling behind on their rent payments.
RentSpree is the preferred, online tenant screening provider of the Apartment Association of Greater Los Angeles. With it, you can put together a completed application package in one simple step. This includes a completed rental application, credit report and score, criminal background check, and national eviction history. RentSpree can handle the entire screening process for you and it takes just two minutes to start screening! Better yet, you can receive all reports back instantly at the property or at another time of your choosing. Visit https://aagla.rentspree.com to learn more.
APARTMENT MANAGEMENT MAGAZINE - NOVEMBER 2021 CS-13