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Tenant Screening, Credit Checks and References

Ask any landlord and they will tell you that screening and selecting tenants is the most important part of the whole rental process.  Whilst 95% of tenants are excellent the other 5% can prove very costly in terms of rent arrears and property damage. 

What steps can be taken to select the best possible tenants for a rental property?

Tenant Identity Checks

Do you really know who your new tenant is?  It is your responsibility to find out by inspecting original documents.  From 2015 such identity checks are likely to be mandatory with fines of up to £3000 if landlords fail to do them. 

We recommend you look a a driver's license, passport and bank statements. You should also request a utility bill in the tenant's name.  You can also ask to see:

  • Birth Certificate or Marriage Certificate
  • National Insurance Card or document confirming NI number
  • Benefit Book (or original letter confirming benefits)
  • Self-employed tax exemption certificate – with photo
  • Recent Inland Revenue tax notification

Discrimination and Tenant Screening

It is against the law to disciminate against potential tenants on the grounds of race, age, disability and gender, religion.  Therefore ensure your checks are objective, systematic and on merit.  We recommend you keep a checklist and record of why you turned down tenants should someone bring a complaint against you for doing so.

Use the advertisement to screen tenants

It may be common sense but your words and description of  the property is anatural screening process and will attract or repel prospective tenants depending on the amount of rent,  location,  and nature of tenancy.  Is it for families or multiple occupiers? It may be tempting to cast a wide net when you advertise but our experience is you are better off targeting the right tenants from the outset.

Meeting a Tenant for the first time

First impressions count.  Did they turn up on time?  Did they attempt to make a good impression? Did they wipe their feet on entry into the property.  Was the tenant open to leaving a refundable deposit and do they appear to have friends who might act as a guarantor for them? Trust your instincts.

Tenant Application form

Under ground 17 of the Housing Act 1988 should the tenant give you false information when they apply to be a tenant you can legally terminate the tenancy. Any 'good' tenant will have no qualms abut providing you with clear and precise personal information.  If a tenant makes a fuss about you asking for this information then you may wish to draw conclusions from that.

Buy an online tenant credit reference check

Most landlords think £15-£20 is a small sum to pay to get a comprehensive tenant or guarantor check. Once you have the tenant's personal information from their application form you can go online and get it checked.

The most basic credit searches will include amongst other things the following:

  1. Credit score
  2. Credit history over a 6 year period
  3. Whether there have been any County Court Judgments (CCJs) and a bancruptcy check.
  4. Debts, arrears, defaults and repossessions
  5. Identity check including confirmation that their bank account exists
  6. Delinquent tenant check

In addition to the above steps many landlords opt for an even more detailed report that includes actual written references from an employer and/or past landlord plus an affordability assessment.