If you want to serve your tenants a notice, get a consultation from a lawyer or paralegal first. A lot of case are tossed out at the Landlord and Tenant Board because the landlord made one, tiny mistake on the notice for that they served to the tenant.

For landlords, protecting their property investment is critical. If you’re not careful, the wrong tenants can cause a variety of problems, including complaints from concerned neighbors, costly damages, and even a lengthy eviction process. To counteract this, landlords in Canada typically conduct a tenant credit check as part of the tenant screening process. In this guide, we’ll explain why, how, and where you should run a credit check on prospective tenants.

One of the most important aspects of the rental process is choosing tenants carefully. You are, after all, due diligence, essentially inviting strangers to live on your property, which doesn’t come without risk.

Credit checks have evolved into a vital screening tool for property managers and landlords, allowing them to assess applicants’ financial suitability as well as their reliability. You can learn a lot about an applicant’s credit history, borrowing habits, and general dependability by conducting a tenant credit check. You can decide whether to accept or reject a rental application with knowledge after reading this information. a good paralegal could help you to interpreted the credit history of potential tenants.  

How to get a tenant’s credit check in Canada

Credit information in Canada typically comes from one of the country’s two major credit bureaus: Equifax® or TransUnion®. There are a few ways landlords can obtain this information:

• Directly from a credit bureau — With applicants’ consent, landlords can grab a credit report from either of Canada’s two major credit bureaus
• Asking the tenant to provide a credit report — It’s also common for landlords to ask tenants to purchase a credit report themselves and provide a copy with their application.
• Using a property management company — Some busy landlords opt to use a property management company for handling their rental properties. These professionals will also take care of tenant screening for you using one of the above methods.

What information does a tenant credit check include?

A tenant credit check in Canada is primarily used to evaluate a tenant’s financial suitability based on their spending habits and debt levels. This takes the form of a credit report that summarizes their credit history, including:

• Credit score
• Any outstanding debts, loans or bankruptcies
• Payment history on loans, credit cards, and other financial obligations

The Trust Score from liv.rent also includes additional information, like:

• Employment history and income details
• Court records or other details
• Risk assessment

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A credit check, while important, is not always a definitive picture as to a tenant’s finances. Some may have a large balance on their cards that they are working to bring down, or a similar situation that impacts their score. My tenants have a terrible score but have never missed a payment. Some people just need help, don’t forget to be human. That’s the part too many of the slumlords in this group forget.