3 Common Questions about a Credit Report

Why isn’t there a FICO score?

In order for somebody to get a FICO score they must first build up debt.  That means the consumer needs to have been spending money for a period of time to allow the credit reporting agency to make a proper measurement of their credit.  There are many kinds of individuals who may not yet have a credit score.  If your renter is a college student, they are very likely to not have a credit score because they do not yet have a credit card of their own and their guardians may be paying most to all of their expenses.  Somebody coming from outside the United States may also not have a credit score built up because all of their spending has been in a different currency.

I see a criminal history.  Should I stop considering this tenant?

You are at your full discretion when deciding not to rent to someone; however there are some assumptions you might make based on the presence of criminal history that may not be necessary or accurate.  For example, you may be overlooking the details on what the criminal record is.  There is no discrimination on what is recorded in the criminal history.  While important items such as sex offender database checks, violent crimes, drug use, etc. are used.  You might also find speeding tickets and improper stops at a stop sign included in the report.  If this is what you find, you might choose to overlook the criminal history when deciding if they are a qualified tenant.

Something else to consider is the time that has passed since the criminal activity.  This again is at the landlord’s discretion, but there are some scenarios that are not problematic for your apartment community.  For example, if your prospective tenant is 45 years old and their criminal history was shoplifting from when they were an adolescent, there may not be any concern with their criminal history in the present.

More severe crimes may require more scrutiny.  It is possible that your applicant has done jail time between the date of the crime and today.  There may not be sufficient time spent outside of the penitentiary to suggest that they will not commit criminal activity again.  If you see criminal history in your report from a long time ago, ask your prospective tenant about it.  It’s ok to dig a little bit deeper to find out if there is a true risk from this prospective tenant today.

There is a mismatch of present address.  Does that mean the tenant was dishonest?

It’s possible the present address provided by your prospective tenant is not a true address.  A great way to check this is to see if there are any other mismatches such as the social security number and nuances in the name.  If these items match, then it might reflect less alarming causes for the address mismatch.   If the present address is very recent, then it might not reflect on their background check.  After running a background check, having a list of two or three previous addresses provided by your tenant may be beneficial.  While you will only enter the most recent address for the report, the report will usually come back with other previous addresses, allowing you to cross-reference.  If this information lines up, there is significantly less concern.  To be extra safe, you also can follow up directly with the landlord of the most recent address to ensure your prospective tenant lived there.

** Always be sure to follow all proper procedures when handling a tenant.  Please be sure that any metric you use in review of an application must be applied to all applications to rent.  A comprehensive view of F.C.R.A. law and procedures can be found here.  Also be sure to follow all fair housing laws and not to discriminate based on race, gender, minority group, etc.  Please also observe local ordinances, which may supersede some federal laws. **