Tenant Referencing and Reference Letters

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

For your free reference templates please click
here .

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 nosey as that may well put the tenant off. The tenant
may have good reason.

For your free reference templates, please click
here .

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.

The bank reference is the worst reference. 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. 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.

For your free reference templates please click
here .