- 11 October 2021
- Posted by: admin_gray
- Category: Property
Written by Sapphire of the Savvy Women Group.
Having the right tenants in your property can truly make or break your ability to succeed in owning investment rental property. Knowing what red flags to look out for is only half the battle, today’s blog will help you avoid common mistakes made when choosing tenants.
While problem renters can exhibit some warning signs, there are some renters who are quite adept at getting past landlords. As a result, it is important to understand that you simply cannot rely on your first impression of a prospective tenant to determine whether they will be responsible and reliable.
TIPS TO AVOID PROBLEMATIC TENANTS
1. Require any prospective tenants complete a rental application.
It may sound simple enough, but this should be your logical first step. The application should be in writing and should provide you with the information you need to decide regarding renting the property. Make sure you are always following the law.
Discriminating against prospective renters is against the law and could land you in quite a bit of trouble. You are not allowed to deny someone the ability to rent your property based on religion, race, etc. By following the Fair Housing Act, you can make sure that you do not violate any discrimination laws. (For the full Housing Act click here)
Need advice on all the legal steps you need to take as a property investor? Join one of our crowd-favourite, One-one mentorship programs today and learn how to best navigate the investment property business.
2. Always make sure that you obtain proof of identity.
This includes seeing a photo identification from any prospective tenants that you interview.
On the rental application you have prospective tenants complete, make sure they write down their driver license information.
Make a copy of the photo ID and be certain that you attach it to the rental application.
3. Cover your bases with an ethical background check
Many landlords make the mistake of not performing a background check. This is a decision that you cannot afford to make if you want to ensure that you avoid potentially troublesome tenants.
Performing a background check gives you the opportunity to determine if there are any previous problems. For example, a background check can let you know if a prospective tenant has a history of destroying property or missing rent payments.
4. Perform a credit check
You will need to obtain the applicant’s permission to do this; however, you can do this on the rental application.
You will also need to obtain the applicant’s National Insurance number on the application to run a credit check.
5. Require references to verify if tenant is a suitable/safe option
References are essential, they will tell you if a tenant displayed anti-social behaviour such as hoarding, destroying property, overly disruptive to neighbours.
Make sure that you obtain the name of the applicant’s previous landlord so you can follow-up. This is because not all landlords make a report to the authorities when there is a problem, so by checking with the landlord directly you have a better chance of determining if there were any problems.
6. Character references
Make sure that you take the time to check with those references. If the applicant did not give you a valid reference this is a good way to find out about it and weed out the applicant.
7. Check tenant is legally allowed to live in the UK
Under the Immigration act 2014, there are strict rules landlords must follow to check “that their tenants have the right to lawfully live in the UK” Curchods says, referencing ARLA Propertymark. Read more on the report here.
8. Set your code of conduct expectations
Make sure that you include information regarding a code of conduct with each application or lease. The code of conduct should state what is expected of the tenant and have the prospective tenant sign and date the document.
By making sure that these expectations are clearly outlined in the beginning, you can help to avoid several problems.
At Savvy Women Group, we know the hassle that can arise when you don’t match the right tenant to your property. If you follow these tips, you and your prospective tenants will both benefit by making sure you are both on the same page. Book a free consultancy session with Savvy Estates today to access our team of experts now.