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Suppose this: your tenant’s lease is up for renewal, and you’re faced with a tough decision. Do you renew the lease automatically, trusting that everything will continue smoothly, or do you take a step back and re-evaluate? What if you don’t catch a red flag in time, and suddenly you’re dealing with late payments, property damage, or even an eviction?
This scenario happens more often than you might think. Too many landlords assume that once a tenant has proven themselves initially, there’s no need to double-check. But the truth is, people’s circumstances change; jobs are lost, debts pile up, and sometimes behaviors shift. Ignoring these changes can cost you thousands in lost rent, repairs, and legal fees.
That’s where renewal screening checks become your secret weapon. They’re the proactive steps you can take to avoid surprises, safeguard your investment, and keep your rental business thriving.
Having spent over a decade helping Oklahoma landlords navigate lease renewals, I know how essential solid renewal screening is. In this article, you’ll learn exactly what to include, why it’s crucial, and how to conduct screening legally and efficiently, plus practical tips, red flags to spot, and tools to simplify the process.
If you want to protect your rental income and keep your properties in great shape, read on. Because when it comes to lease renewals, being proactive beats being reactive every time.
Key Takeaways
- What it is: Renewal screening checks evaluate your current tenant’s reliability before offering a lease renewal.
- When to do it: Start 60–90 days before the lease expires.
- What to review: Payment history, credit, employment, background, behavior, and property condition.
- Why it matters: Helps you spot red flags early, protect your property, and make confident renewal decisions.
- Bonus benefit: Builds stronger landlord-tenant relationships by setting clear expectations.
What Is a Renewal Screening Check for Tenants?
Renewal screening checks are periodic assessments of current tenants performed before offering them a lease renewal. They are not as intensive as the original tenant screening, but they serve as a refresher to ensure the tenant still aligns with your expectations.
Typically done 60–90 days before the lease ends, these checks may include:
- Reviewing rent payment history
- Pulling updated credit reports
- Running a background check
- Verifying employment and income
- Conducting a property inspection
- Assessing overall behavior and communication
The goal isn’t to be invasive; it’s to confirm that your tenant remains a good fit for the property and hasn’t developed any red flags over the lease term.
Why Should You Conduct Renewal Screening Checks?
Many landlords skip or overlook renewal screenings, assuming the tenant’s previous performance guarantees a smooth renewal. However, before renewing a tenant’s lease, it is crucial to reassess the tenant’s suitability to ensure they remain a good fit for the property. People’s situations can change. Here’s why renewal screening is essential:
1. People’s Situations Change
Your tenant may have lost their job, taken on more debt, picked up criminal charges, or started falling behind on bills. Renewal screening brings that to light. Relying on past data alone puts you at risk, as renewal screening helps landlords evaluate the ongoing financial stability of their tenants.
2. Avoiding Expensive Evictions
Evictions are time-consuming and costly. According to TransUnion SmartMove, the average eviction can cost landlords up to $3,500 in legal fees, lost rent, repairs, and turnover. A renewal check can help you prevent that.
3. Preserving Property Value
Responsible tenants take care of your property. A tenant who has started neglecting your unit could be causing long-term damage. Regular inspections and renewal screenings let you catch issues early.
4. Supporting Other Tenants and Neighbors
In multifamily units, a problematic tenant can disturb others and damage your reputation. Renewal checks help ensure that everyone living in your properties is contributing to a safe and peaceful environment, fostering positive relationships and maintaining a positive living environment for all residents.
What Does a Lease Renewal Screening Involve?
Renewal screening helps you reassess the tenant risk profile, which includes their payment behavior, income stability, rental history, and overall reliability. Without this check, you risk locking into another lease with a tenant who may no longer meet your rental standards. Here’s a breakdown of what to look for and why each element matters:
1. Rent Payment History
The first thing to check is the tenant’s payment record. Were they consistently on time, or did they frequently pay late or miss rent altogether? Most property management systems or accounting software, like AppFolio, Buildium, or QuickBooks, can generate a ledger quickly.
Red flags:
- Multiple late payments
- Bounced checks
- Partial payments
- Communication issues regarding rent
2. Updated Credit Checks
It’s smart to request permission to pull a new credit report. A significant drop in score, new collections, or increased debt could signal financial instability.
If you’re unsure how to do this properly, here’s a helpful guide on how to run a credit check on tenants.
Use reliable tenant screening tools like:
- TransUnion SmartMove
- Experian Connect
- RentPrep
What to look for:
- Current credit score
- New derogatory marks
- Debt-to-income ratio
- Rental payment history
3. Criminal Background Check
If your initial lease allowed for periodic background checks or if the lease includes language about criminal activity, it’s fair to run another one during renewal screening.
Not sure where to start? Here’s a step-by-step guide on how to do a background check on tenants.
Consider public safety and liability. While Fair Housing laws prevent blanket exclusions, you can still deny renewal if there’s a legitimate safety concern.
4. Employment and Income Verification
Even if your tenant had a steady job a year ago, that might not be the case now. Ask for updated proof of income:
- Recent pay stubs
- Bank statements
- Employer verification
Ideally, a tenant’s rent-to-income ratio should fall between 30–40%, meaning their monthly income is 2.5 to 3 times the rent. A higher ratio could signal financial stress and a higher risk of payment issues during the next lease term.
5. Property Condition Inspection
With proper notice (usually 24–48 hours), conduct a walk-through inspection. Look for cleanliness, maintenance issues, unauthorized occupants or pets, and damage.
Warning signs:
- Hoarding
- Excessive wear and tear
- DIY modifications
- Pest infestations
6. Communication and Behavior
Evaluate how the tenant interacts with you or your property management company. Do they:
- Respond to messages and notices?
- Cooperate with maintenance?
- Respect neighbors and rules?
Communication issues now could lead to larger issues later.
Legal Considerations for Renewal Screening Checks
Conducting lease renewal screenings is valuable, but you must stay compliant with laws, including:
1. Get Tenant Consent
To remain compliant with the Fair Credit Reporting Act (FCRA), always get written permission before running a credit or background check again. This should ideally be part of your lease agreement.
2. Apply the Same Criteria to All Tenants
Be consistent. Apply the same screening standards for all renewing tenants. If you only screen select individuals, you risk accusations of discrimination or violating Fair Housing laws.
3. Follow Local and State Laws
In Oklahoma, landlords must provide at least 30 days’ notice before non-renewal of a lease. That means your renewal screening must happen well in advance.
Check local statutes for:
- Notice period requirements
- Just cause requirements (if applicable)
- Tenant privacy protections
How Should You Notify Tenants About Renewal Screening?
It’s best to be transparent. Give tenants advance notice that you will be conducting a renewal review. A sample message:
“As part of our standard lease renewal process, we review each tenant’s account, including payment history, property condition, and current qualifications. We appreciate your cooperation.”
This gives them a chance to prepare and avoids confusion or distrust.
What Happens After a Renewal Screening?
Option 1: Renew Without Changes
If your tenant passes the screening with flying colors, great! Offer a renewal at the same or adjusted rent rate.
Option 2: Renew With Conditions
You might choose to:
- Raise rent based on market trends
- Require a co-signer
- Prohibit unauthorized pets or occupants
Send a lease renewal offer outlining the new terms.
Option 3: Decline to Renew
If red flags are present and you’re not comfortable continuing the tenancy, issue a Notice of Non-Renewal or Renewal Denial Notice in accordance with your lease and state law.
Avoid listing specific reasons unless required. A neutral statement like, “We are electing not to renew the lease” is sufficient in most cases.
Benefits of Renewal Screening
According to the National Apartment Association (NAA):
- 50–60% of renters renew their lease annually
- The cost to replace a tenant ranges from $2,500 to $4,000
- Landlords who screen renewals experience 30% fewer evictions
These stats show the ROI of being proactive.
Final Thoughts on Renewal Screening Checks
Renewal screening checks aren’t about being intrusive or distrusting your tenants. They’re about staying informed, reducing risk, and making sound business decisions. Real estate is an asset-heavy investment, and each lease renewal is a key touchpoint for managing that asset wisely.
By being thorough, fair, and consistent, you protect your rental, support good tenants, and set your portfolio up for long-term success.
Whether you self-manage or use a property manager, implementing renewal screening into your leasing cycle is one of the smartest decisions you can make.
Need help managing your renewals and screening? Consider working with OKC Home Realty Services an experienced property management company in Oklahoma.
FAQs on Lease renewal screening
Do landlords verify income when renewing a lease?
It’s not always required, but it’s a smart, proactive step, many landlords do verify income when renewing a lease asking paystubs and bank statements, especially if they want to ensure the tenant still meets affordability standards.
What are the common red flags to watch for lease renewal?
1. Repeated late or missed rent payments
2. Significant drop in credit score or new collections
3. Relevant criminal records
4. Job loss or income reduction
5. Property damage or poor upkeep
6. Communication breakdown or rule violations
Spotting these signs early can save you costly problems later.
What are the tools to simplify renewal screening?
You can simplify renewal screening with tools like Buildium, AppFolio, and Rentec Direct, which automate tasks like payment tracking and tenant communication. Screening services like SmartMove and RentPrep provide updated credit, background, and income checks, helping you renew leases confidently and efficiently.
Is a lease renewal the same as a lease extension?
Not exactly. A lease renewal often includes a new agreement with updated terms. A lease extension typically continues the current terms for a short period.
What happens if a tenant refuses a background or credit check at renewal?
If your lease includes a clause allowing renewal screenings, you may have the right to deny the lease renewal. Always consult with a real estate attorney in your area before taking action.
Author
Scott Nachatilo is an investor, property manager and owner of OKC Home Realty Services – one of the best property management companies in Oklahoma City. His mission is to help landlords and real estate investors to manage their property in Oklahoma.
