The Importance of Vetting & Reference Checks When Choosing The Right Tenant
When vetting potential tenants, there are a few key benefits to doing so. First and foremost, it helps ensure you choose the best possible renter for your property. Checking their credit score and references from past landlords or employers can help weed out bad tenants. When you know a person’s rental history, you can identify renters who may not be able to pay their rent on time or won’t take care of your property.
Additionally, vetting tenants can help protect you from potential legal troubles. By checking a tenant’s credit score, you can see if they have any past evictions or bankruptcies. This can help you avoid renting to someone who may cause problems down the road.
Overall, vetting tenants is vital to finding the right person to rent your property. By doing credit checks and references checks, you can rest assured that you’re making a wise decision regarding who rents from you.
What about applicants with a low credit score or no credit history?
While renting to someone with no credit history may be risky, it’s not always a bad idea. Sometimes, a person has a “thin” file because they have excellent money management skills and do not feel the need to use credit.
Some important points to consider for an applicant with no credit history or a low score. It doesn’t mean that they’re bad tenants; it just means that they haven’t had the chance or the need to build up their credit yet.
Here’s what you can do if you’re applicant has no credit history:
- Ask for references from current and previous landlords
- Ask for at least three month’s bank statements
- Check employment references
- Ask for a guarantor
A guarantor is responsible for the rent payments if the tenant cannot pay. For this reason, a guarantor should be subject to the same checks as the tenant.
Whether you rent to an applicant with a low score is your decision. You can make a more informed decision by considering all the factors involved.
How to Conduct Reference and Credit Checks for Your Tenant?
There are a few ways to get a credit check for a tenant in the U.K. The most common method is to use a credit reference agency. These agencies have access to credit data from several different sources, including banks, employers, and landlords. They can provide a detailed report on the tenant’s credit history.
If you’re using a letting agent, tenant screening is often included as part of the package. If you’re completing the screening, you can contact a third-party credit reference agency. They’ll charge you a fee for the service; however, it’s much less than the cost of a letting agent.
Refusing a Tenant: When, Why, and How
In some cases, you may choose to refuse a tenant because of something you found in their reference checks or credit history. For example, if they have a habit of not paying their rent on time, you may choose to refuse them.
However, you may not refuse to rent to a tenant if the reason for refusal could be considered discriminatory. You cannot refuse a tenant based on:
- Gender or biological sex
- Marital status (single, married, divorced, common law)
- Family status (pregnancy, children)
- Religion, culture, race, or ethnicity
- Health Conditions
How Sharehouse can help with trusted partners at a low fixed price
Sharehouse Project believes self-managing your rental property should be a pain-free experience. With their Tenant Find service and network of trusted partners, advertising your property and selecting the perfect tenant will be a piece of cake.
Using Sharehouse to select and screen your tenants will provide a long-term tenant and peace of mind for years to come.