June 7, 2018, Michigan Representative Peter Lucido of Shelby Township introduced House Bill 6126, which expands the total dollar figure landlords can collect as a security deposit from 1.5 months rent to 2 months rent plus $100.00. Given that the average tenant background check costs around $85.00, this addition should adequately cover the up-front expense most landlords would incur by conducted such background checks. The question on this bill is if the “plus $100” is considered part of the security deposit, which by law is to be returned upon the completion of the rental agreement, minus damages; or is this added figure is to cover upfront expenses incurred by the landlord? As WZZM13 of Grand Rapids pointed out in their coverage (https://www.wzzm13.com/article/news/local/michigan/heres-why-renting-a-place-to-live-could-get-more-expensive-in-michigan/69-563017533), renting in Michigan could get slightly more expensive. By landlords conducting background investigations on their tenants, they are further protecting themselves against bad renters who might otherwise damage their property or fail to make payments. Too often we speak with landlords in need of our locate and asset investigation services to help track down and collect from former tenants who failed to make payments or destroyed their rental properties. We ask these folks if they considered conducting background checks before signing the final paperwork; with most saying they hadn’t considered them before the issues they had, but will do so in the future.
Pricing on tenant background checks is really straightforward and a reputable company should only charge a landlord for the information they actually want (not an entire pre-made package). Most searches include criminal history and credit history, but civil litigation and prior landlord/tenant cases are also applicable; with even the more comprehensive background investigations coming in at under $150.00.