Introduction

Finding the right tenant is one of the most critical decisions a Philadelphia landlord can make. A single bad tenant can cost you thousands in unpaid rent, property damage, and lengthy eviction proceedings. Yet many landlords rush through the screening process or skip important verification steps, leaving themselves vulnerable to financial loss and legal liability.

The good news? A systematic, consistent tenant screening process—grounded in fair housing compliance—dramatically reduces risk and helps you identify reliable tenants who pay on time, respect your property, and maintain good neighbor relations.

This guide walks you through the must-check items every landlord should verify before signing a lease: credit reports, criminal background checks, employment verification, and past landlord references. We’ll also explain how to apply these criteria consistently across all applicants to ensure compliance with Pennsylvania’s Fair Housing Act and Philadelphia’s Renters’ Access Act.

Why Tenant Screening Matters: The Numbers

The cost of a bad tenant is staggering. According to industry data, the average eviction takes 3–6 months and costs $3,000–$5,000 in legal fees, lost rent, and property repairs. Worse, during that time, the tenant may stop paying rent, damage the unit, or leave you with a property in poor condition.

A comprehensive screening process takes just a few hours upfront but can save you tens of thousands of dollars and countless headaches down the road.

The Four Pillars of Tenant Screening

1. Credit Reports: Assessing Financial Responsibility

What to Check:

A credit report reveals how an applicant manages debt and pays bills. It includes:

• Payment history (35% of credit score)
• Current debt levels and credit utilization
• Collections accounts or charge-offs
• Bankruptcy filings
• Inquiries and credit-seeking behavior

What to Look For:

• Payment history: Look for consistent, on-time payments. A few late payments years ago are less concerning than recent delinquencies.
• Collections or charge-offs: These are red flags, but context matters. A medical collection from 2015 is different from an unpaid credit card from last year.
• Bankruptcy: A discharged bankruptcy from 5+ years ago is less risky than a recent filing. However, recent bankruptcies warrant careful consideration.
• Credit score: While not the only factor, scores below 600 typically indicate higher risk. Many landlords use 650+ as a threshold, though this can vary by market.

Pro Tip: Use a reputable credit reporting agency and obtain written consent from the applicant before pulling their report. Under the Fair Credit Reporting Act (FCRA), you must provide a copy of the report and explain any adverse decisions based on it.

2. Criminal Background Checks: Safety and Liability

What to Check:

A criminal background check reveals felony and misdemeanor convictions. In Pennsylvania, you can access:

• State criminal records (Pennsylvania State Police)
• Federal criminal records (FBI)
• County court records
• Sex offender registries

What to Look For:

• Violent crimes: Convictions for assault, robbery, or homicide are typically disqualifying.
• Drug offenses: Felony drug convictions may warrant denial, though single misdemeanor offenses may be evaluated case-by-case.
• Property crimes: Burglary, theft, or fraud convictions suggest a risk to your property and other tenants.
• Sex offenses: Check Pennsylvania’s sex offender registry and consider the nature and recency of the offense.

Fair Housing Compliance:

The Fair Housing Act prohibits blanket bans on applicants with any criminal history. Instead, you must:

• Apply the same criteria to all applicants
• Consider the nature, severity, and recency of the offense
• Evaluate whether the crime is relevant to tenancy (e.g., a 15-year-old DUI is less relevant than a recent theft conviction)
• Provide the applicant an opportunity to explain or dispute the findings

Pro Tip: Use a third-party background check service that specializes in tenant screening. These services often provide legal guidance on compliance and documentation for your records.

3. Employment Verification: Income and Stability

What to Check:

Employment verification confirms that the applicant has stable income to pay rent. Verify:

• Current employment status and job title
• Length of employment
• Gross monthly or annual income
• Likelihood of continued employment

What to Look For:

• Income-to-rent ratio: A common benchmark is that rent should not exceed 30% of gross monthly income. For a $1,500/month apartment, the applicant should earn at least $5,000/month gross.
• Employment stability: At least 2 years at the current job is ideal, though shorter tenures may be acceptable if the applicant is in a growing field or recently relocated.
• Income documentation: Request recent pay stubs (last 2–3 months), W-2s, or tax returns to verify income claims.

Special Situations:

• Self-employed applicants: Request 2 years of tax returns and business financial statements.
• Retired applicants: Request proof of pension, Social Security, or investment income.
• Students: May require a co-signer or proof of financial support from a parent or guardian.

Pro Tip: Contact the employer directly to verify employment rather than relying solely on documents. Many employers will confirm employment dates and current status over the phone.

4. Landlord References: Real-World Rental History

What to Check:

Past landlord references provide invaluable insight into how the applicant actually behaves as a tenant. Ask for:

• Contact information for the current and previous landlords (at least 2 references)
• Dates of tenancy
• Rent payment history
• Property condition and maintenance
• Reason for moving
• Any lease violations or complaints

What to Ask:

When you call, ask open-ended questions:

• “How would you describe this tenant’s overall rental experience?”
• “Were there any issues with rent payment or lease compliance?”
• “Did the tenant maintain the property in good condition?”
• “Would you rent to this tenant again?”
• “Did the tenant give proper notice before moving?”

Red Flags:

• Evasive or reluctant answers
• Mention of late payments, noise complaints, or property damage
• Refusal to rent to the applicant again
• Frequent moves (more than once per year without clear reason)

Verification Tips:

• Call during business hours and ask to speak with the landlord or property manager directly.
• Verify the phone number independently (don’t use a number provided by the applicant).
• Take detailed notes of the conversation.
• Be wary of references provided by the applicant’s friends or family—insist on actual landlords.

Pro Tip: If an applicant has no rental history (first-time renter), consider requiring a co-signer or asking for additional references from employers or community leaders.

Consistency and Fair Housing Compliance

The Critical Importance of Uniform Criteria

One of the biggest mistakes landlords make is applying different screening standards to different applicants. This inconsistency creates legal liability and opens the door to fair housing violations.

Example of Problematic Inconsistency:

• You deny Applicant A (African American) for a 30-day-old late payment on their credit report.
• You approve Applicant B (white) despite a similar late payment from 45 days ago.

This inconsistency suggests discriminatory intent and violates the Fair Housing Act, even if unintentional.

Creating a Screening Policy

To ensure consistency and legal compliance, document your screening criteria in writing:

Sample Screening Policy:

Minimum Qualification Standards:– Credit score: 650 or higher- No felony convictions within the past 7 years- No evictions or collections within the past 5 years- Employment: Employed for at least 2 years, or self-employed with 2 years of tax returns- Income: Gross monthly income at least 3x the monthly rent- Landlord references: At least 2 years of positive rental history with no late payments

Key Points:

• Write it down: Document your criteria before you begin screening. This demonstrates good faith and consistency.
• Apply uniformly: Use the same criteria for every applicant, regardless of protected class (race, color, religion, national origin, sex, disability, familial status).
• Document decisions: Keep records of all screening results, the criteria applied, and the reason for approval or denial.
• Provide written notice: If you deny an application, provide a written explanation citing the specific criteria not met.

Philadelphia’s Renters’ Access Act: What You Must Know

In 2023, Philadelphia enacted the Renters’ Access Act, which significantly impacts tenant screening practices. Key provisions include:

1. Rental History Consideration

Landlords must consider an applicant’s rental history in context. You cannot automatically deny an applicant for:

• A prior eviction if the applicant can demonstrate they have since paid the debt or reached a settlement
• Late rent payments if the applicant can show they were caused by circumstances beyond their control (job loss, medical emergency, etc.)

2. Criminal History Limitations

You cannot deny housing based on:

• Arrests that did not result in conviction
• Convictions that have been expunged or sealed
• Convictions for which the applicant has completed their sentence and demonstrated rehabilitation

You can consider convictions for crimes of violence or sex offenses, but must evaluate them individually rather than applying blanket bans.

3. Screening Fee Transparency

If you charge an application fee for screening, you must:

• Disclose the fee amount upfront
• Provide an itemized breakdown of how the fee is used
• Refund the fee if the applicant is approved

4. Timely Notification

You must notify applicants of approval or denial within a reasonable timeframe (typically 5–7 business days) and provide written reasons for denial.

Best Practices for Compliant Screening

1. Use Third-Party Screening Services

Professional tenant screening companies handle background checks, credit reports, and eviction history verification. Benefits include:

• Legal compliance guidance
• Standardized reporting
• Documentation for your records
• Reduced liability

Popular services include TransUnion SmartMove, Zillow’s screening tool, and specialized property management platforms.

2. Obtain Written Consent

Before pulling credit reports or background checks, obtain written consent from the applicant. This protects you under the FCRA and demonstrates transparency.

3. Provide Adverse Action Notices

If you deny an application based on credit or background information, provide the applicant with:

• A copy of the report
• Written explanation of the adverse action
• Information on how to dispute inaccuracies
• Contact information for the reporting agency

4. Keep Detailed Records

Maintain records of:

• All applications received
• Screening results for each applicant
• Criteria applied
• Approval or denial decisions
• Written communications with applicants

These records protect you in case of a fair housing complaint or legal challenge.

5. Train Yourself on Fair Housing

Fair housing law is complex and evolving. Consider:

• Reading the HUD Fair Housing Handbook
• Taking an online fair housing course
• Consulting with a real estate attorney familiar with Philadelphia rental law
• Joining a local landlord association for updates on regulatory changes

Red Flags vs. Manageable Concerns

Not every blemish on a credit report or background check should result in automatic denial. Here’s how to distinguish between disqualifying red flags and manageable concerns:

Red Flag (Usually Disqualifying)	Manageable Concern (Evaluate Context)
Recent violent crime conviction	Medical collection from 5+ years ago
Active eviction or recent eviction (within 1 year)	Eviction settled 3+ years ago with explanation
Felony drug conviction	Single misdemeanor DUI from 10+ years ago
Current non-payment of rent to another landlord	Late payment 2+ years ago, now current
Sex offender registry listing	Bankruptcy discharged 5+ years ago
Multiple recent late payments (within 6 months)	Temporary job loss 2+ years ago, now employed

What to Do If You Discover an Issue

If screening reveals a concern, follow these steps:

Step 1: Verify the Information

Confirm that the information is accurate. Credit reports and background checks can contain errors. Contact the reporting agency or ask the applicant to explain or dispute the finding.

Step 2: Evaluate in Context

Consider:

• How recent is the issue?
• What was the cause?
• Has the applicant demonstrated rehabilitation or improvement?
• Is the issue relevant to their ability to be a reliable tenant?

Step 3: Apply Your Criteria Consistently

If your policy states you deny applicants with evictions in the past 5 years, apply that rule to all applicants. Don’t make exceptions based on personal preference or protected class.

Step 4: Document Your Decision

Write down the reason for approval or denial. If you deny the application, provide written notice to the applicant.

Common Screening Mistakes to Avoid

1. Skipping References

Some landlords rely solely on credit scores and background checks. Don’t. Landlord references often reveal issues that numbers don’t capture.

2. Ignoring Income Verification

A tenant with perfect credit but insufficient income is likely to struggle with rent payments. Verify income independently.

3. Applying Different Standards

This is the #1 fair housing violation. Document your criteria and apply them uniformly.

4. Failing to Provide Notice of Denial

If you deny an application, the applicant has a right to know why. Provide written explanation.

5. Relying on Gut Feeling

Screening should be objective and data-driven. Gut feelings are subjective and create legal liability.

6. Not Updating Your Criteria

Rental law changes. Stay informed about Philadelphia’s Renters’ Access Act and other evolving regulations.

Conclusion: Invest Time Upfront, Save Money Later

Thorough tenant screening is not about being overly cautious or discriminatory—it’s about making informed decisions based on consistent, objective criteria. By verifying credit, conducting background checks, confirming employment, and contacting landlord references, you dramatically reduce the risk of problem tenants and the costly consequences they bring.

The key is consistency. Apply the same standards to every applicant, document your process, and stay informed about fair housing compliance. This protects both your investment and your legal standing.

Remember: The time and cost of screening upfront—typically $50–$150 per applicant—is a small price compared to the potential cost of eviction, property damage, or legal liability from a bad tenant.
Ready to screen smarter? Start by documenting your screening criteria in writing, then apply them consistently to every applicant. Your bottom line—and your peace of mind—will thank you.