Tessa's Tenancy Tips: Choosing your tenant

It is generally agreed that probably THE most important thing to get right when renting the property to tenants is the choice of tenant.

If you choose a good tenant, things will go smoothly.  Even if there are problems (for example if the tenant falls on hard times and has problems paying) if the tenant is someone sensible who you can talk to, you will be able to resolve things amicably.

On the other hand, if you are unlucky enough to rent to a ‘nightmare tenant’ (happily rare but they do exist) you will have nothing but trouble.  They will not pay rent, or if they do the payments will be erratic, they will not look after the property properly, they will be very difficult to deal with, and you will probably end up having to evict them through the courts at great expense.

In a worst-case scenario, you could even end up with criminal tenants who convert your property into a cannabis farm!

I know known landlords lose thousands of pounds all due to the landlords or their agents not checking the tenants carefully enough.  So, you see how important this is!

Let’s take a look at the things you need to do:

 

Taking details

You will need to have a comprehensive form for applicants to complete and sign.  This will give you something to go on in your enquiries.  You will also need to get the applicant to sign letters of authority authorising referees and the credit referencing company to provide you with information about them.

There are a number of forms you can use - my Landlord Law service has one, but it is best to use this as a starting point only and adapt it to include all the information YOU have found that you need.

Note that it is also a good idea to double check all the information you are given.  For example, is the employer's telephone number correct, or is it the phone number of your applicant’s friend?  Putting the number into Google is a good trick to find out whose number it is.

 

Credit referencing

This is where a professional credit referencing company does a check on the prospective tenant and sends you a report.  It is important that you do this as it will show up any CCJs the tenant may have and any other credit issues.  

However, you should not rely on this alone.  Indeed in the case reported here the Judge found that letting agents had been negligent in just relying on the report alone and not doing any further checks where the information provided raised an issue.

 

References

These are basically:

  • Employer
  • Bank
  • Previous landlords and
  • Personal references

The employer's reference is the most important as this is what will be paying your rent.  

So far as the others are concerned, you need to be careful.  The current landlord, for example, may be desperate to get rid of them if they are nightmare tenants and so unwilling to do anything to put you off.  

Personal references may be helpful if you believe the referee is being objective, rather than a friend talking them up!

 

Online checks

The internet now gives us further ways we can check out applications.  You should at least put the name into Google and see what comes up.  You should also check the name on

  • Facebook
  • LinkedIn
  • Twitter

You may find out something surprising about them!

 

Other warning signs

Probably the most important thing is your ‘gut instinct’.  Do you feel uneasy about this person?  If so, maybe your subconscious is telling you something. If possible, rent to someone else.

You also need to be very wary about applicants who offer to pay the whole of the rent upfront in cash and who appear anxious that you should not visit the property during the term.  

These are the classic signs of someone who wants to convert your property to a cannabis farm.  Note that these people can usually convert the property and get two harvests within six months, doing thousands of pounds worth of damage to your property in the meantime.  Something to avoid.

Tip - are you covered for damage done by cannabis farms in your insurance?  Find out more about this in my free insurance mini-course.

 

Personal visit   

Finally, if you are unsure, many landlords recommend a visit to the applicant in his or her current property.  This will give you a much better idea of how they live and treat their home, and may help you avoid unsuitable tenants.

 

In conclusion

Your property is a valuable investment.  You are going to entrust this to a total stranger for months if not years.  It really is vital that you do all the proper checks to make sure that your valuable investment is in good hands.

Note that this article does not cover right to rent checks as we will be looking at these later in this series.

Next time I will be looking at protecting the tenancy deposit.

In the meantime you can find me at www.landlordlaw.co.uk, my Landlord Law Blog at www.landlordlawblog.co.uk and on twitter @TessaShepperson


Tessa Shepperson

Tessa is a lawyer specialising in landlord & tenant law and runs the popular Landlord Law online service for landlords.


Posted by Tessa Shepperson on 18 April 2017

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