Tenant Referencing

In order to determine a potential renter's appropriateness for a rental property, landlords or letting agents use a tenant reference process to confirm information about the applicant. To ascertain a prospective renter's capacity to pay rent and general dependability as a tenant, it entails investigating their credit history, income, employment, and rental history.

Purpose: The purpose of referencing is to assess the suitability of a potential tenant in relation to a rental property. The reference checks establish whether the potential tenant can afford to pay the rent on time and be punctual. Referencing also allows the referee to gather information about their financial reliability and character. Ultimately, a detailed reference check will allow the landlord to make an informed decision on which tenant to go ahead with.

Types of Checks: There are a vast number of checks available to ascertain the credibility of a potential tenant. The main ones being:

Credit check - An up-to-date credit check confirms the tenant's credit score as well as a full breakdown of their payment history.

Income verification - This check verifies the tenant’s income and affordability capabilities. Income is often verified by requesting the tenant to provide bank statements and payslips to make sure all income is correlated accurately with the bank statement.

Employment verification - Employment checks are carried out to make sure the tenant is actually employed where they say they are. Other employment from the past is also looked into and references can be requested from them if deemed necessary.

Previous rental checks - This check is to see the tenant's past rental history with previous landlords

ID verification - A very important check, this verifies the tenant’s identity Extensive background checks - Not for all cases, but in some cases, thorough background checks may be carried out to check for criminal records

How it works:

1) The landlord or their assigned letting agent can conduct these checks themselves or by using a third-party service to do the references on their behalf

2) The tenant provides all of the relevant information which is then in return verified through various sources

3) Once the results of the checks have returned, it is then down to the landlord or the letting agent to decide if they wish to give the tenancy to the tenant in question

Benefits:

Using tenancy referencing before agreeing for a tenant to move into your property reduces the chances of potential pitfalls faced in the future. Reference checks minimise this risk greatly and if a reference comes back to how you did not expect, you can decide against the tenant moving into your property; further protecting you from facing more problems.

At Lux Realty, we can assist the landlord and take on the burden of carrying out all relevant checks on a potential tenant so you do not have to. We work fast preventing unnecessary delays and look to conclude matters in a swift time period. Contact us now!