CalculateRealEstateROI

Risk Management

How do I reduce tenant default risk?

Screen rigorously (640+ credit, 3x income, prior landlord ref), require security deposit, consider rent guarantee insurance.

Reviewed by Keiron Brown, Founder & Editor, CalculateRealEstateROI · Educational estimates only — not investment, financial, tax, or legal advice

Direct answer

Screen rigorously (640+ credit, 3x income, prior landlord ref), require security deposit, consider rent guarantee insurance.

Expanded explanation

Best predictor: prior landlord reference. Verify employment with direct call. Some markets offer rent guarantee insurance ($30/mo per tenant) covering 6 months unpaid rent.

Examples

  • Screened tenant: 720 FICO, $6k income on $1,500 rent, clean references.

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