What is the tenant referencing process?
Tenant referencing is a process used by landlords/agents to assess the suitability of prospective tenants. It involves gathering information about the tenant’s background, financial history, and rental history to evaluate their reliability and ability to fulfil their obligations as a tenant.
Tenant referencing typically involves several checks and verifications, which may include:
1. Credit Check:
This involves assessing the tenant’s credit history to determine their financial stability and whether they have a history of late payments, defaults, or financial problems. However, it is essential for a tenant to be open and honest regarding any adverse credit. As a result, honesty is more likely to make a landlord/agent more understanding about the situation and help with alternative options.
2. Employment Verification:
Additionally within this process, Any income source must be confirmed. For example, the tenant’s employer may be contacted to confirm their employment status, income level, and job stability. And if in receipt of benefits proof of income would be requested. It’s important to check the legitimacy of the contact information provided and make sure the right person is confirming the information
3. Previous Landlord References:
Contacting the tenant’s previous landlords allows the current landlord to gather information about the tenant’s rental history, including payment reliability, conduct, and whether they left the property in good condition.
4. Right to Rent Check:
Furthermore, landlords are legally required to verify that anyone looking for property to rent as their primary home has the right to rent a property. For anyone who has a Visa, this check is digital and online which makes the process quick and easy.
5, Affordability Assessment:
Lastly, the landlord may evaluate the tenant’s income and financial stability to determine if they can comfortably afford the rent. We use the calculation that the annual income must be above 30x the monthly rent of the property.
In summary, tenant referencing can help landlords make informed decisions about potential tenants. Subsequently mitigating the risk of renting to individuals with a history of payment issues, property damage, or other concerns. The process helps ensure that the tenant is who they claim to be and provides a level of security for the landlord.
