Simple, Effective Screening for Better Tenants in Oklahoma

Background checks are a vital part of thorough tenant screening. Every landlord needs to know the history of every applicant. Background checks give you a good idea of whether someone makes payment on time, stays out of massive debt, has a criminal past, and a lot more.

Background checks also reduce the chances of tenant turnover, protect you from liability, and help you and other tenants remain safe.

In this article, we’ll help you understand what background checks consist of, how to ensure you get the information you need, and what you need to know about your state’s rules regarding them.

What are Background Checks? 

Background checks typically consist of a credit report, criminal history, income verification, eviction history, and a rental application. 

Credit Report

Aside from a lease agreement, a tenant credit report might be the most crucial document for a landlord to understand. This document is one of the best ways to determine whether someone will pay on time and in full. Here are the main components of a credit report: 

• • Basic information like former names/aliases, current and previous addresses, etc. 
  • Fraud indicators like invalid phone numbers or phony social security numbers 
  • Tradeline summaries that give a snapshot of an applicant’s active accounts  
  • Inquiries that show a list of companies who viewed an applicant’s credit file over the last two years 
  • Credit/resident score 

A credit score is a numerical value anywhere from 300-850 that helps illuminate an applicant’s creditworthiness. If an applicant has a score of 500 or less, proceed with caution. Most reliable tenants will have a score above 560. 

A resident score is similar to a credit score, but more directly reflects someone’s reliability as a tenant. Both scores are proprietary, so the exact formulas aren’t available to the public. That said, resident scores typically include a recommendation on whether to accept an applicant or not (this shouldn’t be treated as gospel obviously, but it can be helpful).  

Criminal History

Wide-sweeping national databases, more narrow specific state databases, and granular county records are the main elements of most criminal history reports. 

Income Verification

There are several ways to verify income. Let’s look at some of the most common here:  

• • Pay Stubs: Paychecks are the most common way to verify income. Anyone with full-time or part-time employment can make copies of paychecks and send them to you. 
  • Yearly Tax Returns: A federal tax return is another option to obtain proof of income. This is often an excellent option because it’s an official legal document, so it’s difficult to fake. 
  • W-2 Tax Form: These forms show employer’s withholding payroll taxes from workers’ earnings. This is another good option because it’s a document directly from an employer. 
  • Bank Statements: This method is especially effective for self-employed applicants because they won’t have regular pay stubs like those who work for traditional businesses. 

Important Note: Innago’s new income verification feature, which you can learn more about here, makes it easier than ever to ensure your tenants have the necessary funds to pay you. 

Eviction History

Except in cases where overdue rent went to collections or a previous landlord reports late payments, credit reports don’t usually show evictions.  

Federal law typically prevents evictions from being shown on a background check after seven years, but this figure varies by state. 

If you cannot see an applicant’s eviction history on a credit report or obtain the information by contacting their previous landlords, then you may pull an eviction report. However, certain states have restrictions on different kinds of reports (we’ll address those if they’re relevant later in this piece).  

Eviction history matters because the cost of an eviction for landlords is often between $4,000 and $7,000 or more. That means that if a tenant was evicted, they likely left their previous landlord with no other choice. 

Application

A rental application is a preliminary form used to obtain basic information about an applicant and their eligibility. Most applications ask for this information:  

• • Basic Contact Information: Think entire legal name, cell phone number, email address, etc. 
  • Current and Former Renting Experience: Four to five years back is typically plenty. 
  • Landlord References: Contact previous landlords and get their take on applicants. This is a critical step that some landlords skip over. Make sure you’re not one of those landlords. 
  • Employment History: You want to know current and former employers and get consent to contact them. 
  • Written Permission to Run a Credit Check 
  • Legal Disclosures: Here’s a helpful article on what disclosures to include. 
  • Additional Inquiries: Be careful here. Make sure you don’t ask questions that violate laws. Only ask about things like pets or smoking. And make sure you’re consistent. 

Why Do You Need to Run an Oklahoma Background Check?  

An Oklahoma background check is, in general, used by a variety of groups: landlords, employers, lenders, licensing agencies, government agencies, etc. They are run to ensure that a candidate for a job, license, property, or loan is properly qualified and does not have a history of behavior that would interfere with their ability to perform the duties required under contract. Background checks minimize legal liability, protect companies’ assets and current employees, and are sometimes required by clients.   

When it comes to landlords, an Oklahoma background check is needed to:  

• Protect the safety and property of other tenants  

• Reduce tenant turnover  

• Minimize legal liability  

• Increase the likelihood of on-time rental payments  

• Obtain criminal history record checks that help better understand applicants and potentially protect other renters 

• Narrow down applicants for a high-demand property  

• Prevent expensive and lengthy eviction processes  

Oklahoma Background Checks  

Landlords in the Sooner State should run a background check (Oklahoma) on potential tenants as a precaution and general policy. Here are three reasons to run background checks in Oklahoma:  

1. Rental application fraud  

Rental application fraud, which occurs when a tenant lies on their application or submits falsified pay stubs, bank statements, etc., is on the rise. A 2022 study by Snappt done in America found that almost 15.6% of pay stubs scanned of the nearly 50,000 applicants reviewed doctored pay stubs. Running an Oklahoma background check can help guard against fraudulent documents and inconsistent information before someone moves into your property, lowering your chances of dealing with an expensive eviction later.  

2. Avoid future evictions  

Evicting a tenant in Oklahoma is a process every landlord wants to avoid. A large reason for this is that an eviction in Oklahoma can take between two and seven weeks. And — because tenants with a previous eviction are more likely to be evicted again — understanding an applicant’s eviction history is essential for avoiding this costly issue.   

3. Learn about the existence or nature of illegal activity  

It’s also important to conduct criminal background checks in Oklahoma. Per World Population Review, Oklahoma has the second largest incarcerated population in the country. While landlords cannot have a blanket policy for denying citizens with a criminal record, certain crimes (like sex crimes) restrict housing options and can be valid reasons to deny a tenant. It’s important to conduct background checks because it helps you understand potential tenants better and gain awareness of criminal history that may impact an applicant’s ability to be a good tenant. 

How far back Do Background Checks in Oklahoma go?  

When you use consumer reports to make tenant decisions, you must comply with the Fair Credit Reporting Act (FCRA). 

Section § 605 – 15 U.S.C. § 1681c of The Fair Credit Reporting Act (FCRA) applies in all 50 states and mandates a seven-year restriction on reporting certain background check information like civil suits, civil judgments, and arrest records (except in certain cases where an employer is hiring for a job with a salary more than $75,000). The FCRA doesn’t have similar timeline restrictions on criminal convictions, but some states restrict reporting conviction information at the local level. 

There aren’t laws in Oklahoma restricting landlords from using old convictions and criminal history to deny someone rental housing. Thus, if you can see something of this nature that is a red flag on a background report, you can typically use it to reject an applicant. 

The criminal history information landlords obtain will come from the Oklahoma State Bureau of Investigation’s (OSBI) database. Landlords cannot, however, use this information to violate the Fair Housing Act and discriminate against someone based on things like religion, race, and sex.  

What does a Criminal Background Check (Oklahoma) Cost?  

Criminal background checks are fairly affordable across the U.S., but their costs vary depending on the area searched and the level of information requested. Searching national records typically costs between $13-60 per person, while searching an individual state’s records like Oklahoma typically costs between $10 and $30 per person (e.g., OSBI charges $15 for a name-based report for criminal history records). County records, which tend to be more accurate and up to date, usually cost $16-$25 per person per county checked. You can learn more about each of these specific types of background checks in our article on the topic.  

Which Laws Apply to Oklahoma Background Checks?  

An Oklahoma background check cannot be used by anyone for any purpose. Due to fair housing protections, the use of credit reports and criminal background checks is restricted.  

Based on Oklahoma background check laws, it’s legal to deny a prospective tenant based on the results of their criminal background check (if a conviction is involved), but it must be clear how their record makes them dangerous to other tenants or neighbors. For instance, if someone has a ticket in their driving records, that’s probably not a valid reason for denial. 

In Oklahoma, you need to get applicants’ written consent to a background check Oklahoma considers compliant before running one.  

Per Okla. Stat. §22-19, employers cannot ask applicants about any expunged or sealed records. In the same spirit, landlords and property managers shouldn’t ask about expunged records, either. 

Oklahoma is a ban-the-box state. This means that employers in the public sector cannot inquire about criminal history on their applications during the hiring process. They must wait until the interview process to ask about an applicant’s criminal history. 

If you decide to deny an applicant, it’s critical to know applicable laws and regulations regarding rejecting potential renters. Read this article to review legal reasons for denial and how to abide by the Fair Housing Act. If you deny an applicant based on information in consumer reports, you’ll need to send them an “adverse action” notice. Read more about these notices here. 

Know OK Background Check Laws

Before you run a background check in Oklahoma, be sure to research state and local background check laws and federal regulations. Keep in mind that while everywhere in Oklahoma is subject to state laws and executive orders, some areas may enforce additional regulations. Be sure you’re educated on the law in your region and adhere to the HUD’s recommendations.  

How to Run Background Checks in Oklahoma?  

When conducting background checks in Oklahoma, it’s best to use a third-party provider. However, you can run one yourself. If you run a DIY background check, you’ll need to fill out a criminal history request form to get government records from the OSBI, contact an applicant’s former landlords and employers, obtain a credit report (Equifax, Experian, and TransUnion are the three major credit reporting agencies that compile credit information), verify income, look at the sex offender registry, and ensure you have all the information you need to conduct thorough tenant screening. DIY checks can be very risky, though, because it’s much easier to run afoul of laws inadvertently (unless you’re extremely well-versed in the law). They can also be extremely time-consuming. 

For expediency and the knowledge that you’re working with a company abiding by laws, it’s a better option for most landlords is hiring a third-party provider. You can select the kind of reporting you need and let the third-party take care of the collection and reporting process. 

Background Checks with Innago  

At Innago, we’ve partnered with Experian to help you review background check information and identify high quality applicants. Running a background check through Innago allows you to quickly and easily identify the best applicants and ensure their application information is accurate. Likewise, Innago’s income verification feature helps our users verify reported income by connecting to their bank account, payroll provider, or by uploading documents. 

Disclaimer: This article is for educational purposes only and does not constitute legal advice. We recommend you consult with professional counsel if you have legal questions regarding your specific practices and compliance with relevant laws.