Tenant Background Checks: A Step-by-Step Guide for Kiwi Landlords

Gather Essential Information

Begin by collecting key documents and information from prospective tenants. The more complete the application, the better. Typical items include:

1. Proof of Identity
   • Driver’s licence, passport, or other photo ID.
   • Verification helps you confirm the applicant is who they say they are.
2. Proof of Income
   • Payslips, letters of employment, or bank statements.
   • Ensures prospective tenants can afford the rent.
3. Rental History
   • Previous addresses and contact details for former landlords or property managers.
   • Helps confirm if the applicant paid rent on time, left the property in good condition, and abided by tenancy agreements.
4. References
   • Professional references (e.g., an employer) can provide extra insight.
   • Personal references can also help, but they may be less objective.

Encourage prospective tenants to submit a complete application to avoid delays and improve their chances of approval.

Interview and Initial Screening

After collecting an application, speak directly with the prospective tenant or schedule a phone interview to clarify important details. Some topics to cover include:

• Reason for Moving: A straightforward, consistent response about why they are changing homes can be a positive sign.
• Timeline: Ask how soon they want to move and for how long they plan to stay.
• Pets and Other Occupants: Check if they have pets, extended family, or flatmates that may affect the property.
• Lifestyle Details: Light questions about how they plan to use the property can reveal alignment with the house rules.

Observe how they respond. A friendly, open approach often indicates willingness to communicate with you throughout their tenancy.

4. Verify Rental History

Contacting previous landlords or property managers can provide valuable feedback. Aim to verify:

• Payment Track Record: Did the tenant pay on time without significant arrears?
• Property Care: Did they keep the home clean and return it in a reasonable condition?
• Length of Tenancy: Long tenancies might indicate satisfaction and stability.
• Bond Issues: Confirm if the tenant’s bond was fully refunded or if there were claims for damage or unpaid rent.

Be mindful of privacy laws. It is best practice to have the applicant’s written consent to contact previous landlords. Focus your questions on tenancy-related matters rather than personal topics.

5. Credit & Financial Checks

Credit checks are a major part of tenant screening in many countries, including New Zealand. A strong credit history suggests the tenant has been responsible with money and is more likely to pay rent on time. While there is no single score that guarantees reliability, watch for:

• Consistent Late Payments or High Debt: Ongoing debt might affect their ability to keep up with rent.
• Bankruptcy or Judgments: Large unpaid debts or court judgments are warning signs.
• Overall Trends: A new credit history or a temporary financial stumble might not disqualify them, but it should prompt further questions.

Some landlords opt to handle credit checks through a professional screening agency or use an online service. Always be sure to comply with relevant privacy regulations and obtain consent from the applicant.

6. Legal and Character Checks

Although New Zealand does not provide a single, nationwide tenant blacklist, there are tools and checks to identify risk factors:

• Tenancy Tribunal History: Some data may be publicly available for cases heard by the Tribunal. Check if the applicant has records of disputes.
• Criminal Record: If a tenant consents, you can request certain Ministry of Justice checks. Bear in mind some convictions may be concealed under the Criminal Records (Clean Slate) Act 2004 if certain conditions are met.
• Personal References: Speaking to an employer or other professional connections can help you build a clearer picture of the applicant’s character and reliability.

Strive for consistency. Ensure you apply the same checks for all applicants to stay fair and avoid any appearance of bias.

7. Meeting Tenants in Person (Optional but Useful)

While not legally required, meeting potential tenants can reveal subtle cues about how they communicate and respect boundaries. This could take place during a second viewing or a more casual meet-and-greet:

• Observe Manners: Are they polite and punctual?
• Questions About the Property: Interested tenants often ask detailed questions on maintenance and amenities.
• Signs of Cooperation: Tenants who provide references quickly and answer queries openly may be easier to work with later.

If meeting in person is not possible, rely on your property manager’s observations or schedule an online video call.

8. Evaluating Red Flags

Be on the lookout for warning signs that may warrant caution or rejection:

• Incomplete Applications: Consistently missing documents or unclear contact details.
• Evasive or Inconsistent Answers: Answers that change or contradict earlier statements.
• Excessive Debt or Multiple Defaults: Patterns of unpaid bills or short-term loans can spell risk.
• Negative Feedback from References: Reports of property damage, repeated late rent, or suspicious behaviour.

While none of these alone means automatic rejection, weigh them carefully, especially if there are multiple red flags in one application.

9. Making the Decision

After gathering references, credit history, and personal details, you can compare each applicant’s strengths and weaknesses. If using a property manager, they may recommend a shortlist based on your requirements. The final choice, however, is yours.

1. Review All Data: Summarise references, financial details, and your personal impressions.
2. Check Compliance: Ensure you have upheld the Privacy Act and the Residential Tenancies Act during the screening.
3. Trust Your Instincts: If you feel uncertain or uneasy, ask for additional references or request a second meeting to resolve concerns.

10. Formalising the Tenancy

Once you decide on a tenant, it is time to:

1. Offer the Property: Contact the applicant, confirm rent amount, bond requirement, move-in date, and any other conditions.
2. Sign a Tenancy Agreement : This is legally required and sets out all terms. Tenancy Services provides standard forms for fixed-term or periodic agreements.
3. Collect Bond: Lodging the bond with Tenancy Services within 23 working days is mandatory.
4. Keep Records: A full record of application details, screening notes, and signed documents can protect you in future disputes.

How NZ Realty Can Help with Casual Letting Services

Screening tenants thoroughly is essential, but it can also be time-consuming. This is where NZ Realty’s Casual Letting Services come in. Our team handles the heavy lifting:

• Advertising & Viewings: We list your rental property on top platforms and show it to prospective tenants.
• Tenant Screening: We perform detailed reference and credit checks on shortlisted candidates to ensure suitability.
• Tenancy Agreement Preparation: We manage the legal paperwork, lodging bonds with Tenancy Services, and organising all necessary documentation.

This service is perfect if you plan to manage the property yourself but want professional help securing quality tenants. By partnering with NZ Realty, you benefit from expert marketing, tried-and-tested screening, and a streamlined agreement process, saving you time and minimising stress.

How NZ Realty can help with finding the right Tenant

A detailed background check is one of the best ways to protect your property and ensure a stable, hassle-free tenancy. Gathering complete applications, verifying rental and credit histories, and trusting your instincts are all part of finding a reliable tenant who respects your investment. If you need assistance along the way, NZ Realty’s Casual Letting Services offer professional support with advertising, screening, and paperwork, so you can secure the right tenant from the start.

Ready to place your property in expert hands? Reach out to NZ Realty today and discover how our Casual Letting Services can help you find high-quality tenants with less effort.

Get in Touch