Are there limits to credit checks?

Q: We are looking to rent our home, and the management company requires background and credit checks on all buyers and tenants to get approved. Our real estate agent already conducted a credit check on our prospective tenants. The tenants do not want a second credit check because they do not want to hurt their credit score. The tenants will have to pay us the rent, so I do not see why the management should care. Do we have to go through this? — Stan

A: When you purchased a home in a planned community, you agreed to live by the rules. This is the trade-off for the amenities and aesthetics for living in this type of neighborhood.

If your community rules require tenant screening, you will need to jump through this hoop. You can try speaking with management to see if they are willing to use the credit report your agent already obtained.

There are two types of credit checks commonly used for tenant screening. A “soft” pull is like checking your credit history, when you get a preapproved credit card offer, and does not show on your report. A “hard” pull is the type you get when you apply for a car lease or loan. This type of credit check will slightly lower your credit score for a short time.

Most credit reporting companies report related credit checks made within a short period as a single check for scoring purposes. This allows consumers to shop around for the best deal without destroying their score.

Understandably, your prospective tenants are frustrated with having to go through a second screening process. They still need to go through the process if they want to rent in your community.