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Why You Should Use Automated Income Verification in Your Tenant Screening Process

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Verifying income history is often a hassle, both for you and for your prospective tenants. Tenants must go through the burden of locating and uploading an abundance of documents, which ultimately will impact whether they move forward with the application process and hurt your revenue potential. 

Not only is it a lot of work, traditional income verification methods are unreliable. Photoshop is widely accessible and it’s frighteningly easy to create a fraudulent pay stub or alter bank statements. AI-driven fraud detection tools are now available but even they don’t give you the entire picture. While these tools work to identify if a document is altered or not, they don’t tell you what you really want to know - if an applicant has enough money to pay their rent on time.

Thankfully, there is a better way to verify income. With nearly 90% of Americans adopting fintech to manage their finances, it’s now possible to use a tool that connects directly with an applicant’s bank account and instantly verify income. Using automated income verification will help busy property managers identify potential tenants with more accuracy, reduce fraud, and get properties leased faster. 

Get precise income data, skip the manual process

Sifting through months of pay stubs and bank statements is a tedious, manual process. This leaves plenty of room for mistakes from a tired eye. Relying on a manual process to screen tenant income can allow less-than-ideal tenants to slip through the cracks, running the risk of missed rent payments later on. 

Connecting directly to financial institutions saves you time and gives you more precise data. You will be able to see all of the tenant’s recurring and non-recurring deposits and where they come from (additionally verifying employment). You will also be able to tell instantly if the net income to rent multiplier is above or below your threshold.

Stop tenant fraud from costing you thousands

Since rising federal interest rates are sidelining people from buying homes, many are turning to single-family rentals. Because of this, rents have been steadily increasing over the last year, contributing to an environment where rental application fraud is more likely. As a property manager, it’s likely you have experienced fraud even if you did not realize it. Nearly all property managers have, and 80% have experienced it more than once. 

Approving the wrong tenants because they were able to scrape by with a fraudulent application will kill your property management company’s potential for growth. It will damage your reputation with your investor clients, cause you to work much harder to fill vacancies, and cost you thousands in eviction costs and loss of rent payments. 

Connecting directly with financial institutions will give you peace of mind by proving ownership of all accounts so you can confidently approve tenants by seeing they make enough money to rent one of your properties. 

Lease properties faster, focus on building your portfolio

When you are busy with the screening process, you take time away from other opportunities that would be more impactful for your business, like growing your property portfolio or building strong relationships with your tenants to boost retention rates. Utilizing an automated income verification tool gives you hours of your time back to focus on more meaningful work. Plus, it’s just as easy for your prospective tenants to use, which helps you make a good first impression. 

The tenant simply has to sign in to their financial applications and enable the connection. It only takes seconds to set up and start working. In less than three minutes, you will have a full analysis of the applicant’s deposit history, proof of account ownership, and be able to identify gaps in pay. No need to spend hours poring over financial statements!

Sunroom Leasing has developed a state-of-the-art tenant screening tool with automatic income verification included. It connects with 99% of financial institutions to give you an accurate income report of your applicants, instantly. Learn more about Sunroom’s tenant screening solution