All landlords dream of finding the perfect tenant: someone who pays the rent on time, without delays or excuses and will treat the property like it’s their own. Here’s how you can undertake a simple, time-efficient screening process that could save you lost income, property damage and stress in the long run.
The truth is that rogue tenants aren’t uncommon. Before a person actually moves in and starts their occupancy, you have no idea what they might be like. That’s why tenant referencing is a must.
When you have a property sitting idle, it’s all too easy to accept the first person who comes along because of the prospect of quick rent money. But this is a false economy. Allow the wrong person to move in and you might find yourself repenting at leisure.
With a simple, time-efficient screening process you could save yourself lost income, property damage and stress in the long run.
How to go about tenant referencing
There’s no one size fits all method but taking these precautions will increase your chances of finding the right tenant.
Ask for ID
First and foremost, be sure the person you’re dealing with is who they say they are. Ask to see a driver’s licence, a passport or some other credible form of ID. Anybody providing false information could be planning to use your property for illegal activity.
From February 2016, the government’s Right to Rent scheme came into effect, requiring landlords to make checks of prospective tenants. This builds on the Immigration Act of 2014 to try to help control illegal immigration.
Renting your property out to somebody who is not entitled to be in the UK could leave you with a fine of up to £3,000 per tenant. To help you out, there’s a Gov.uk tool that will help you through the checking process.
Use a Tenancy Application Form
A basic tenancy application form can be found online or you could draw one up yourself. Getting prospective tenants to fill this in will help you gather a few of the essential details you need to perform reference checks. Whether you use an existing form or draw one up yourself, here’s the information you should obtain:
- Tenant’s personal details:
- Tenancy details:
Number of applicants
Proposed tenancy start date.
- Background checks:
2 x Referee details
Guarantor details (if your prospective tenant is unable to pay the rent)
Current landlord details.
- Employment details:
Current and past employment details
- Details about occupiers:
All the people that will occupy the property.
- Other details:
Smoking status/pets etc.
Remember to follow through on the background checks. It might only be a short phone call or an email but it’s time well spent.
Making sure that your prospective tenant has a guarantor should be a red line. If, for any reason, your tenant is unable to pay the rent, it’s vital that there should be someone who can cover it. For any good tenants with a steady income, this will be a mere formality as it’s not something they’ll have to rely on. If they can’t provide a guarantor, you should take this as a red flag.
Of all the people to contact, the one most likely to provide the best insight into what a tenant might be like is, of course, their current landlord. Have there been any issues or would they wholeheartedly recommend this person to somebody else?
Sending over a landlord reference form is perhaps the easiest way to get this information. The landlord can simply tick ‘yes’ or ‘no’ to basic questions – such as whether the tenant owes arrears or violated the terms of their lease. Example forms can be downloaded online.
As well as a landlord reference, try to visit your prospective tenant’s current home. Inspecting it isn’t always possible but a quick visit might help to assess their standards of cleanliness. You needn’t do this for every applicant, just the ones you’re seriously considering.
Can your prospective tenant afford the rent?
If your prospective tenant falls in love with your beautiful property (as well they should) they might be tempted to sign the tenancy agreement without realistically being able to afford it. This is why you might need to assess the affordability of the property for them.
- Request 3 months’ payslips to verify their income. Factor in cost of living to work out if they can realistically afford the rent
- Check their employment status to find out if they’re in full time, part time or zero hours employment because their pay slips alone might not tell the whole story.