A thorough tenant screening helps a landlord avoid future problems by confirming a potential renter's ability to pay rent and detailing a history of past rental behavior. Property owners must make it a habit to perform the same tenant-check procedure for everyone, as a lack of consistency could be perceived as discriminatory under the federal Fair Housing Act.
1
Create a rental application form, or download one from the Internet. The form should include a rental-verification portion, which the prospective tenant's previous landlord should complete. Leave space to write in name and contact information for the former landlord or management company agent, rental dates, monthly rent, number of late payments, legal action taken to demand or collect unpaid rent, complaints or issues with other neighbors, types of pets and associated problems, tenant's reason for leaving, whether proper notice was given, condition of home at move-out, whether the landlord would rent to the tenant again, and additional comments. The form should also include space for the applicant to write in her name, Social Security number, date of birth, contact information for her employer, supervisor's name and annual salary.
2
Obtain written authorization from the tenant to complete a rental, employment, background and credit verification. You can easily do so by including text at the bottom of the application form and having the applicant sign and date it. The text can read: "I acknowledge the information provided herein is true and correct to the best of my knowledge. I hereby authorize (Landlord Name) to use the information provided for the purposes of conducting a credit and criminal background check, and verifying rental history and employment.
3
Collect an application fee to cover the costs of processing tenant credit and background checks. In the tenant authorization area of the rental application form, you should indicate the fee amount and whether your practice is to refund it or apply it to rent, if applicable.
4
Call the applicant's previous two landlords to get a rental history report. You may ask your questions over the phone. In many cases, former landlords may request a form with written authorization to complete.
5
Verify the applicant's credit and criminal background. You can obtain a credit report directly from one of the three major credit bureaus; Equifax, Experian and TransUnion. Tenant-verification companies allow a landlord to check credit, criminal and eviction histories individually or in a discounted package.

Credits: http://homeguides.sfgate.com/