Tenant References and Referencing

REFERENCES
AND THE TENANT:

References and the Tenant!

A recent request from a landlord who shall remain anonymous
has led us to writing this article. Please read, it is very important and might
help you in choosing a good tenant as opposed to a bad tenant.

Why reference a tenant?

Referencing a tenant will help you establish the fact that
he/she is who they say they are.

What references should I ask for?

None – never ask the tenant to supply references – it is so
easy to make them up especially with computers and photocopiers being as
advanced as they are.

What referees do I ask for?

As an agent we always asked the tenant to supply the
following referees:

Bank – account managers name, address of bank, bank
account number and sort code and a telephone number (or look it up).

Employment: the name and address and telephone number of
the employer and the correct department as well as any employer number.

Previous Landlord – a very useful one this, get the name,
address and telephone number.

Now if the tenant can not provide the above information, look
carefully as to the reasons given. Always be sceptical, but never too nosy that
will put the tenant off. The tenant may have good reason.

What If?

The tenant has no bank account?

Then perhaps they have a building society account, if so then
ensure you get these details instead and request a reference.

The tenant is about to start work for the first time?

Tread carefully. Firstly you will need a reference from an
educational establishment that proves he/she attended there and gained the
qualifications required to get the employment they have got. Secondly you will
need a letter from the employer or future employer confirming that the tenant
has employment and that the salary is sufficient to cover the monthly rent.

The tenant is about to start work for a new employer?

Get a reference from the previous employer, stating how long
they were with the company and that they would not hesitate to re-employ the
tenant in the future (letter enclosed a little later) and get a letter from the
tenants’ new employer stating that they are about to start work on a permanent
contract and that the salary is sufficient to cover the monthly rent.

Tenant has no previous landlord?

Then we always sought references from 2 professional people,
i.e. doctor, dentist, solicitor etc stating that the character of the tenant was
trustworthy and that they would be unlikely to cause any nuisance or grief to
the prospective landlord.

Always write to these people yourself, or if the tenant
provides you with written references ensure that they are true, by contacting
the person who has signed the reference.

Points to note:

If a potential tenant does not want to provide you with any
information then think twice about letting them becoming your tenant.

Never judge people on appearances – yes, even I have been
duped into this one within the first year of my training – cost the landlord a
fortune!

Always check the references and that the referee actually
exists!

If the tenant does not have a bank account or building
society account, how are they going to pay you your rent? How do they get paid
from their employer? How can they prove to you that they are financially stable
and are not going to have a problem with paying the rent?

Remember that references are given in the strictest of
confidence and you must not pass any of the information you receive about the
tenant onto any other person without the tenants’ permission.

Bank references are the worst references. Not only do they
charge a fee of around £10 – £15.00 per status enquiry, they take an age to
deliver them. Our method was to get the tenant to sign a standard letter,
enclose a credit card number or tick a box saying that the fee could be taken
from their account, saving you having to pay and send the original to the bank.
As I said we will enclose the letters at the end of this document. Bank
references can be bit confusing when you get the reply. For example if the bank
returns a reply stating the person in question is good for the amount of £…….
Per month – no problem. If the bank says they should be good for the amount, not
a bad reference really. Should the bank say they are surprised to see the person
in question having this amount of money taken from their account watch out.
However, if they say they are surprised but as long as it is replacing current
commitments then this could be fine as long as the person in question does just
that. I.e replaces one monthly rent with yours! Read the reply carefully.
Remember banks will never be derogatory about the person they are replying about
after all it is their customer, but a lot can be read into them. So please check
them carefully.

Letter to the bank, please feel free to cut and paste and
print as appropriate.

To The Manager

(Address of Bank)

(Date)

Status Enquiry Request:

I would be grateful if you would supply a status enquiry to (Name of
landlord) regarding my ability to pay (monthly rental amount) per
calendar month.

My account details are:

Account Name:- (enter name of account)

Account Number:- enter account number)

Account Sort Code:- (enter account sort code)

Please send your reply to:

Name and Address of landlord.

I understand there will be a charge regarding this request and authorise you
by signing this letter to deduct the above named account with the sum required
to process this request. Please give this request your utmost attention.

Yours Faithfully

(Signature of tenant) Ensure the signature matches the name of the
account holder.

_____________________(print name) Date:_____________2001

Letter to current employer: try to get a specific name
and check that name is valid by ringing the company! Please feel free to cut and
paste and print as you want.

(Name and address of employer)

(Date)

Dear (name of employer)

RE: (name of Tenant)

(name of tenant) has applied for a tenancy through me
and has given me permission to contact you as a referee. As such I would be
grateful if you would kindly supply me with the following information.

1. (Name of tenant) is on a permanent contract
with yourselves.

2. That you see no reason why (name of tenant) should
not be with you in the foreseeable future.

3. That you believe (name of tenant) salary is
adequate to cover a monthly rental of (monthly rental)

4. Please also state for how long (name of tenant)
has been in your employment.

Please note that all the information you give is treated in
the strictest of confidence at all times.

I would be grateful if you would send your reply to:

(your name and address)

Yours Sincerely (or faithfully if letter is addressed to
Sir / Madam)

(your signature)

Letter to previous Landlord: Please cut and paste as you
want etc.

(Name and Address of previous landlord)

(Date)

Dear (name of previous landlord)

RE: (name of tenant)

(Name of tenant) has applied for a tenancy with me and
as such has given me to approach you as a referee and former Landlord.
Therefore, I would be grateful if you would answer the following questions:

1. Please confirm that (name of
tenant) was a tenant of yours and the dates of the tenancy.

2. That the rent was always paid on time.

3. That the property was well looked after

4. That you would not hesitate to have (name of
tenant) as a tenant in the future, should the situation ever arise.

Please find enclosed a stamped addresses envelope for your
earliest reply.

Thank you for your time,

Yours Sincerely

(signature)

These are typical examples of letters that should be
written. Always enclose a stamped addressed envelope so that you are creating
as little hassle for the person on the other end as possible. No need to do
this with the bank though!

An important note for your attention: as a referee it
is illegal to give false information. A landlord can seek compensation from
you if you fail to put a disclaimer on the reply you send. Hence why the banks
and solicitors and several other professional bodies will usually put a clause
along the lines of:

This information is given in good faith and we can not be
held liable for any circumstances that may cause a change in the character or
the characters’ standing. All the information given is done so in the
strictest of confidence and may be passed on to no-one else at all without the
express permission of the author.

Other wording much to the same effect does appear as well.

In conclusion:

I hope the above helps and although we try to ensure we are
being helpful and assisting you in the best possible way, please remember that
all the information published is done so as a guide and that you should seek
your own methods of taking up referencing. Please do not take the above as
gospel as there are many various reasons why tenants can not provide adequate
references and we do not wish to cloud your judgement. However, we do feel
that the above information should be of use to you.

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