Tenant Background and Credit Checks Guide for Landlords

For landlords, dealing with difficult tenants and those who do not pay rent can cause undue stress and money. Not to mention, the process to rectify such problems can be lengthy and add further costs.

Therefore, it is always preferable to know that your tenant is going to respect your property, understands their responsibilities as tenant, and can afford the rent.

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Flag any potential issues with tenants with background and credit checks

One such way to give yourself peace of mind is to perform tenant background and credit checks. These steps can help to flag any potential issues before you sign a contract with them, for example by knowing their rental history, financial background, and any criminal convictions.

Below, the experts in tenancy management at AST Assistance outline what tenant background and credit checks are, and what you as the landlord should be asking for before deciding to hand over your keys.

The importance of background and credit checks for Landlords 

Before you rent a property, you must ask the tenant for information and documentation proving that they will be a good tenant.

The tenant will also need to demonstrate that they, and any other adults living with them, have the 'right to rent' in the UK.

Having your paperwork ready will help you rent faster.

Ensuring their legal right to rent

When your tenant starts or renews the tenancy lease, you or the leasing agency acting on behalf of you must ask to see their passport or immigration paperwork. You must also ask this documentation from any other adults living with them. This ensures they have the legal right to live and rent in the UK - it is known as the 'right to rent check'.

Checking tenant references

To ensure that the potential tenant can afford the property and will meet payment deadlines, you should request references from them.

Typically, the prospective tenant will provide a reference from:

  • Their current and past landlords
  • Their employer, to prove that they have a job and that employment will continue

If the prospective tenant is unable to provide a reference, you can ask them why this is the case. There are other forms of references which can provide adequate proof of the tenant’s ability to pay rent and their reliability. For example, if they have paid previous rent on time, you can ask to be shown their leasing agreement, rent book, or bank statements to confirm it.

Obtaining a guarantor

If your tenant has never leased before, you can ask them to provide a guarantor. A guarantor is someone who agrees to pay their rent if they do not. 

You might also request a 'character reference,' which is a letter from an employer or someone who knows them well that demonstrates their dependability.

Checks on credit

You can perform a credit check to obtain evidence that the prospective tenant can be relied upon to pay rent on time. This will uncover whether they have a history of late payments. However, credit checks must only be done with the individual’s permission.

If the tenant fails a credit check, you should ask them to explain why they believe this occurred, and if they will be able to pay the rent. You might still decide to take them on as tenants, but protect yourself by asking for a greater deposit, more rent in advance, or a guarantor agreement.

If you are looking for a tenant but are time-restricted - and still want to carry out a credit card check on a potential new tenant, you should seek the help of experts in property law and management, such as the team at AST Assistance. We can take the weight of the legal responsibility away from you and help you to understand whether your next tenant is reliable. 

Determining whether a tenant is suitable to rent can often be difficult and can be a lengthy process. To understand what you should be checking and what to look out for, you should seek the help of legal experts in property rights, such as the experienced team at AST Assistance. 

Contact us today by calling us on 01706 619 954, emailing info@ast-assistance.com, or filling out our contact form here and we will get back at a convenient time for you.

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