When defining your policy for processing tenant applications there are two primary camps, those who process the applications in the order that they were received (first applied) and the applicant that appears to be the best applicant based on the application metrics like highest credit score, best rental references, best criminal background check, etc. (best qualified). Both first applied and best qualified have advantages and disadvantages for the landlord and for the property management company that should be considered prior to deciding what your company policy is however, the most important thing to consider when creating this policy is “what is the most duplicatable, scalable, and trainable policy that I can create that leads to consistent results and avoids fair housing violations?”
As with any policy that we want to create for our company, we need to think about the team we have now and also the team we may have in the future. Often when I’m working with a client on policies they share with me that they have a key team member that has their policies in their head and since it has been working out so far they don’t take the time to document what their policies are or what processes they have implemented to uphold the policies. This is problematic for two reasons:
- If that team member ever leaves, your policies and processes leave with them and you don’t have any resources to train their replacement.
- If the team member stays you can’t ever promote them without causing disruptions throughout the organization because there is no system in place to be able to replace them.
- It is fairly easy to determine the first applicants to apply if you are using a digital application process as they are time stamped when the application was submitted.
- The team can immediately begin the process of approving or declining the applicant as soon as one is received.
- The first applicant to apply may have a requested move in date further out than a second applicant which will cause your landlord to experience additional vacancy and if your policy is “first applied” then you can’t consider the second applicant unless the first application does not meet your screening criteria.
- The first applicant may be more of a risk than subsequent applicants but if your policy is to take the first applicant that applies as long as they meet your minimum score on your application scoring system then you must approve them without considering stronger candidates.
- Selecting the best qualified applicant allows you to evaluate multiple prospective tenants at the same time and determine which one you think is the strongest candidate overall.
- Selecting the best qualified applicant may allow you to negotiate rent rate, move in date, and other terms of the lease possibly getting your landlord more money in rent or a tenant that is ready to move in a few days earlier.
- Without a clearly defined policy selecting the best qualified applicant is often very subjective and difficult to train on or duplicate if / when the team member doing the screening leaves the company or gets promoted.
- Selecting the best qualified applicant often delays the process of tenant selection because companies often want to see if there are other applicants that apply or may want to apply. This can cause tenants who have paid an application fee and do not get selected to feel they have been discriminated against.
Once you decide whether your company policy should be “first applied” or “best qualified” you can begin to build out the processes that support the team in upholding and adhering to the company policy. Without a clear policy it’s not possible to create a process that empowers the team to take action, do their best and feel confident in the actions they are taking.