Proof Of Income Is Crucial for Destin Landlords. Here’s Why.

  • 2 years ago
Proof Of Income Is Crucial for Destin Landlords. Here’s Why.

A landlord wants to find tenants that are responsible and respectful, but how do they figure out who is right for their Destin property?

A big part of this decision is deciding whether a tenant can pay the rent every month. And the best way to do this is to ask for proof of income.

Here’s a look at why proof of income is important and how it’s used during the tenant screening process.

What Is Proof of Income?

Proof of income is a way of validating that a prospective tenant has a job that provides them with regular income. Proof of income could be in the form of something like a pay stub from the potential tenant that shows how much they’re paid and how often.

There are multiple different ways of proving one’s income, but no matter the method, it’s important that a landlord takes steps to verify it.

Why Is Proof of Income Important?

Without a way of proving that a tenant can pay the rent, a landlord runs the risk of losing money and potentially having to evict the tenant if it turns out they don’t have consistent funds.

Knowing that a tenant can pay the rent each month will allow a landlord to keep up with their mortgage payments on time. This leads to less stress for both parties.

There are other ways of discovering whether a potential tenant will be reliable or not, such as their credit score or letters from previous employers or landlords. But proof of income is often the best way to gather more concrete information about a tenant’s ability to pay rent timely.

The idea that a tenant should earn three times more than the rent has been around for a long time, but don’t feel like you need to stick to this strictly. Especially in areas where housing tends to cost more, it’s up to the landlord to decide whether a tenant is truly eligible or not.

Ways of Verifying Income

The most popular and easiest way of verifying a tenant’s income is by asking for their pay stubs. These should show what their current job is and how much they’re earning so the landlord can decide whether it’s enough to pay their expenses.

However, if a potential tenant has more irregular work or several different forms of income, just asking for their pay stub may not show their complete financial picture.

This is where bank statements can be helpful. A landlord will be able to see all the money that’s coming in and going out, giving them a better idea of the potential tenant’s finances.

Additional options for income verification include tax returns, employer letters, or unemployment documentation, among others.

Proof of Income Creates a Trusting Tenant-Landlord Relationship

Proof of income helps provide security for both you and your tenant so you both feel confident in the rental agreement going forward.

If you’re looking for Destin property management services, we’re here to help. Reach out to us today to get started.

Compare listings