Vetting Prospective Tenants

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

    Vetting Prospective Tenants

    As we await hearing from the bailiffs to see when one of our tenants is to be evicted for non-payment of rent, we are starting to think about how best to protect ourselves from a similar experience.

    How much information can a LL legitimately collect or examine, without being OTT or unreasonably intrusive? Is it reasonable to see evidence of current tenancy, and income (tenancy agrement & payslips) and to ask the prospective tenant to show the pay going into bank account (using bank statements), and to show rent and other property outgoings (utilities etc) going out? I don't think we'd expect to be given copies of this information, but to have the opportunity to review it, and perhaps take some notes to support the normal referencing process.

    We have already decided, in principle, not to rent to anyone who can't satisfy us that they are conducting their current tenancy to the landlord's (reasonable) satisfaction, which means turning away applicants who have not rented before or recently, and we might avoid tenants who are setting up home together for the first time (but whether that provides any comfort is debateable).

    Any thoughts?

    #2
    Have you never used a company like tenantverify?
    'Pause you who read this, and think for a moment of the long chain of iron or gold, of thorns or flowers, that would never have bound you, but for the formation fo the first link on one memorable day'. Charles Dickens, Great Expectations

    Comment


      #3
      Originally posted by mind the gap View Post
      Have you never used a company like tenantverify?
      'Like' tenantverify? That would depend on whether they offer anything more than usual referencing service. My current tenant passed referencing, and the selection cost me £2,500 (so far) more than the referencing fee paid by the tenant.

      Comment


        #4
        You can and should ask for all of the tings you want and mention. There is no such thing as OTT (barring obvious legal/sexual etc discrimination). You don't get what you want it is bye bye.

        10K in the bank is a minimum in my world. Don't turn away first time renters. Tenancy checking agents are useful but that is only 20% of the job.

        You want a tenant who has something to lose. No benefits (I am afraid) apart from child benefit or pension).

        Comment


          #5
          Originally posted by AndrewDod View Post
          10K in the bank is a minimum in my world.
          £10k in whose bank?

          How do you evaluate first-time renters?

          Comment


            #6
            In Scotland charging tenants fees has been illegal since at least 1984. I sift tenants to check myself (chat, maybe documents..) then I pay myself for a tenant check (usually). Either about £7 each or about £22 each.

            But my best tenants ever (in over 16 years) were take on the basis of a non-English speaking neighbour of mine saying "Mr Artful they very nice people". The worst tenants I chose, early on, more than once, on the basis they were like me: Fatal.
            I am legally unqualified: If you need to rely on advice check it with a suitable authority - eg a solicitor specialising in landlord/tenant law...

            Comment


              #7
              Originally posted by StuartH View Post
              £10k in whose bank?

              How do you evaluate first-time renters?
              Prospective tenant needs to be able to show that they have resources and can manage those resources.

              Don't think it is that hard: Tenant with a (proven) job that seems stable, money in the bank, no criminal/other record, looks and speaks like a sensible and decent human, not on benefits, answers all questions in a straightforward way, and the things you check check out. Employer references that you need to check out. Your gut will tell you the correct answer at least 97% of the time.

              Comment


                #8
                Originally posted by AndrewDod View Post
                10K in the bank is a minimum in my world.
                10k minimum ?!!! Blimey.

                Nothing saying because they have 10k in the bank that they are going to pay their rent.

                I credit check my tenants, and ask for 3 months payslips showing a steady income and ensure they earn 300% of the rent each month, plus a quick phone call to previous landlord to ask a few questions. I try to ask questions which would catch out any tenant trying to pass off their auntie Sandra as their previous landlady. You would be suprised how many chancers are out there.

                I dont faff around with references much. I like to sit down at my desk with a cup of tea and be done vetting a tenant by the time I finish my cup.

                Comment


                  #9
                  Originally posted by dazwalsh View Post
                  10k minimum ?!!! Blimey.
                  Nothing saying because they have 10k in the bank that they are going to pay their rent.
                  I credit check my tenants, and ask for 3 months payslips showing a steady income and ensure they earn 300% of the rent each month, plus a quick phone call to previous landlord to ask a few questions. I try to ask questions which would catch out any tenant trying to pass off their auntie Sandra as their previous landlady. You would be suprised how many chancers are out there.
                  For those not on low income:
                  Someone who earns 3x the rent and yet doesn't have 6x the rent (2 months of salary) in the bank
                  despite having no mortgage or maintenance to pay
                  has a problem with financial planning and lack of buffer.

                  Comment


                    #10
                    IMO there is no such person as the perfect T (or LL), just someone that will provide least grief for the other. Some people in a Profession can have an inflated opinion of themselves/position, so mere bank balance is no guarantee of proberty.
                    3x rent as income is no guarantee as T situation can change virtually overnight.
                    My preference for a T would be one that can manage to balance bank statement over 6 months, age 30+, married, and someone who could change a tap washer & smoke/fire alarm batteries.
                    If you find the recipe for the perfect T please share it.

                    Comment


                      #11
                      What about purchasing one of the 'Rental and Legal expenses 'insurance policies?
                      After an unpleasant eviction experience I have just bought one for the first time so have no idea how effective they are but pretty much all my local LA try and sell them to prospective LLs so I thought I would give it a go.
                      FWIW, My best tenants ever, currently still in situ 3 years on did not pass the RLA reference/credit checks. They were able to explain exactly why ( wife had been ill, unable to work and self employed husband had taken time off work to care for her) If I had used an agency they would probably have been turned down so I consider myself very lucky to have been able to make the decision to take them on.

                      Comment


                        #12
                        Originally posted by charliesugar View Post
                        What about purchasing one of the 'Rental and Legal expenses 'insurance policies?
                        I raised that possibility, recently, and the consensus seemed to be that they don't pay out! http://www.landlordzone.co.uk/forums...nses+insurance

                        Vetting incoming tenants more effectively seems to be a much better strategy than relying on an insurance which might prove to be worthless - which you don't find out until you seek to rely on it.

                        Comment


                          #13
                          My child was a first time renter recently - 3 students, renting for the first time. Wouldnt be every landlord's first choice of tenant but you have 6 people to chase for rent ( 3 tenants, 3 guarantors). I know they are paying the rent, they are cleaning the place, if not to a standard my wife approves of so it'll be more thoroughly cleaned before they leave, and they arent annoying the neighbours. They may be a bit demanding over faults but a decent landlord will want to know about and fix the major faults and can ignore any others.

                          Point of this is - dont rule anyone out automatically. Take a hard look at the bank statements and see what they are spending money on. Are credit card repayments on there - think about what debts they might have. I wouldnt even rule out a tenant on benefits if they had worked recently - they might be back in work in a few months. I wouldnt take them if they hadnt adjusted their spending to match a lowered income.

                          Dont rely on appearances, some of the biggest con artists are personable.

                          Comment


                            #14
                            I actually visit every potential 'preferred' tenant (after initial sift) at their current address on the pretext of delivering important paperwork to be signed etc. so far there have been two I have 'not progressed' - all the others were then subject to tenant verify. one of them had ccj's but they were upfront and explained what had happened and it had been paid before it was due to be paid off completely. the person was also a clean freak and they were great tenants, just moved out (to a higher rental property) because they wanted a garage/parking for their cars.

                            so my suggestion would be if at all possible arrange a visit to where they live, it will provide you with information you wont get answered on any forms/telephone calls etc

                            Comment


                              #15
                              Mister B,

                              Do you use an estate agent to find your tenants or do you advertise your own property?
                              Any advice I give is my opinion and experience, I am as you also learning.

                              Comment

                              Latest Activity

                              Collapse

                              Working...
                              X