Skip to Content

Proof of Income is Crucial for Landlords

Proof of Income is Crucial for Landlords

When screening new tenants, it is important to verify their income in order to protect yourself from losing money in case the tenant for any reason is unable to pay rent.

Having a proof of steady income that is enough to pay the rent can reduce the risk of losing money during eviction. It also helps to ensure the tenant does not lose their home because of eviction. So what do you look at when verifying tenant’s proof of income?

3x income ruleproof of income

Apart from stable source of income, landlords also take into account tenant’s gross yearly income which should be three times the rent of the apartment. However, you can make exceptions to this rule if the potential renter has good credit or steady work history. By looking at a few pay stubs, you can establish if a potential renter has the financial capacity to rent your apartment.  This is only possible with salaried and freelance workers who have filed W9s forms. A W2 or 1099 can also provide an indication of the potential tenant’s ability to pay rent on time and in full.

Employer verification

If a potential renter works on cash-only basis, you can conduct employer verification to get clear picture of their finances. In cases where a potential renter has just changed jobs, ask for a copy of their offer letter to verify their salary.

Tax returns

Some landlords use tax returns as sufficient proof of income because a tax return indicates what an individual made the previous year.

Social security statement

For retirees, a distribution statement from social security, a retirement fund or a pension fund can be used to verify the income. Students without salaried jobs can prove their income by providing information about financial aid or by finding a consigner, usually a parent or guardian.

We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. See Equal Housing Opportunity Statement for more information.

The Neighborly Done Right Promise

The Neighborly Done Right Promise ® delivered by Real Property Management, a proud Neighborly company

When it comes to finding the right property manager for your investment property, you want to know that they stand behind their work and get the job done right – the first time. At Real Property Management we have the expertise, technology, and systems to manage your property the right way. We work hard to optimize your return on investment while preserving your asset and giving you peace of mind. Our highly trained and skilled team works hard so you can be sure your property's management will be Done Right.

Canada excluded. Services performed by independently owned and operated franchises.

See Full Details