Last Updated on October 22, 2021 by Kelvin Nielsen
Background checks are usually a compulsory process for most landlords. It means a big deal to landlords because it gives them a better picture of prospective tenants. Though this process can reveal a lot about you, it majorly boils down to one thing – your ability to pay rent. And this is where your employer comes into play.
When filling out your rental application, most landlords will require you to list your employer as one of the references. They require this in order to verify some important information from your current employer.
Do you wonder whether the landlord actually calls your employer? Well, while some of them will not call, the bigger percentage will. The following is what to expect in this regard.
Why do landlords call tenants’ employers?
There are several reasons why your potential landlord would call your employer:
1. To verify your employment status.
The first thing the potential landlord will want your employer to verify is whether you actually work for them. This is so because some witty tenants will lie about being employed and give a phony contact.
Now, when the landlord makes the call, your employer will verify whether or not you’re employed. This way, the landlord’s mind will be at ease knowing that you have a job.
Besides calling, a landlord can obtain your employment information from your credit report. This could particularly be the case if your employer reports to credit reporting bureaus.
It’s also important to note that landlords are, nowadays, wary of tenants who list fake employers as references. The fake employers will claim to have employed the tenant and say niceties about them.
2. To establish your length of employment.
It’s also in the landlord’s interest to know how long you have worked with the company. Broadly speaking, being employed with a company for a significant period could mean financial stability.
3. To verify your income.
Being employed is one thing; earning a decent income is another. So, even though you’re employed, the landlord would want to know the amount that you make every single month.
That’s because landlords usually require tenants to earn a certain multiple of the rental price as income. As a general rule of thumb, very few landlords will accept a tenant that makes less than 3X the rental price. For example, if the rental price is $1,5000, then you should be able to make at least $4,500 as monthly income. This will increase your chances of being considered to rent the apartment.
Not all employees can provide your employment information, though. Some could see it as your confidential information. In such a case, you may have to hand in your pay stubs or payslips to verify your income. Documents such as W-2s and tax returns could also come in handy.
Are there landlords who will not call a tenant’s employer?
Landlords are created differently. While some will be so meticulous with your employment status, others will not even make the call. However, they’ll ask for your pay stubs or slips to establish whether you can fulfill your rental obligations. In addition, they might even have to check your:
- Renting history to see if you have been late on rental payments or faced an eviction.
- Criminal background to ensure that you’re a law-abiding citizen.
- Credit score to gauge your financial stability and establish whether you are a reliable tenant.
Can your employer disclose information without your consent?
Most employers will not disclose your income or length of employment without your written consent. This is a breach of privacy and it could attract legal action! To this end, your employer will require you to sign a release of information form before letting out the information. Alternatively, you can ask your employer to write a letter to the landlord verifying your income and period of employment.
Who will the landlord call if I’m self-employed?
Even in the case where you don’t work at a regular month-to-month job, your landlord will still want to verify your income. If that’s your case, prepare to hand in three of your most recent bank statements. The landlord will want to see whether there are inflows.
If you’re unemployed, retired or a full-time student, you might also have to show your bank statements. In addition, the landlord could want references to people who can testify to your good conduct. These could be your friends, parents, or anybody who knows you.
A landlord will call your employer to verify your employment status, length of employment, and income. They do this in order to ensure that you are a reliable tenant who can afford to pay rent. If you have worked with the company for a significant period and earn a decent income, you stand a better chance.
Hi, I’m Kelvin Nielsen, an experienced landlord and accomplished real estate lawyer. My focus is on answering your questions about renting in the hopes of making your life as a renter or a landlord a bit easier.