Whether you’re in charge of doing a potential tenant or employee background check, you have to do more than just check references. Sure, references help you find out more about a person, but credit reports come with benefits that reference checking doesn’t.

Here’s why:

1. References are selected by the applicant in advance
Reference checking involves calling people that your potential employee or tenant has listed on their application. And, of course, people are going to only list references that are going to say glowing things about them! After all, who’s going to list an angry creditor or a disgruntled former boss as a reference?

Reference checking is a great way to find out more about your potential employee or tenant’s positive attributes — like their attention to detail, their responsible nature, and the fact that they’re a really great person to know. However, talking to references isn’t going to uncover any of the potentially bad things about the applicant. If you rely solely on reference checking, you may not be getting the whole picture.

2.Credit reports show information that references wouldn’t know

A former boss may not know that your potential tenant was evicted from their last apartment. A friend may not know about the credit card debt that your potential employee racked up due to his gambling problem. However, credit reports will show all of this — and much more.

Credit reports give you a sense as to whether your potential employee or tenant is responsible. They’ll show you if the person pays his bills on time, if he’s drowning in debt, or if he’s got anything in his past ton indicate that he might not be able to live up to your expectations. If you’re doing a tenant or an employee background check, having this information is essential!

3. Credit reports are unbiased

Reference checking is human-based, so you’re going to have to deal with human emotions and subjective statements. However, credit reports don’t have any human aspect to them, so they’re completely objective. They simply list the facts and aren’t clouded by any kind of emotion or opinion.

4. Credit reports will indicate whether your tenant is going to pay you

Doing a tenant credit check is really the only way to see if your tenant is going to pay you every month. Of course, nothing is foolproof, but if a tenant credit check shows that your potential tenant pays all of his bills on time and doesn’t have a ton of debt, it’s a pretty good indicator that you can expect a rent check every month.