Vetting tenants is crucial. If you’re a landlord, locating the perfect tenant can make your life a lot more straightforward. The difference between getting a dependable tenant in your rented accommodation and an unreliable tenant is huge – it could even be the difference between getting a rent payment and not getting one at all. Plus, a good tenant will take care of the property, stay in contact if there is a problem (and respond to you if you contact them) and, when they leave, they’ll leave the place in exactly the condition you want them too – as evidenced by your inventory report.
Yet vetting tenants isn’t something that all landlords do. A letting agent will, of course, take on this task, but if you’re renting without using an agent, it really is so very important to carry out the right checks before allowing someone to live in your property. Of course, it’s true they might pass all the checks and still be terrible tenants, but if you don’t even try, you’ll really never know.
Vetting Tenants’ Affordability
Ensuring a tenant is going to be able to pay their rent is one of the most fundamental checks that you are going to need to carry out. If tenants do not pay promptly, landlords will struggle – it’s that simple. This is a business, and without an income that business will fail. If you have a mortgage to pay, then it becomes even more difficult when tenants don’t pay. Confirming a tenant is able to afford to spend their rent is a sensible step, and ideally you want to be looking at an income that is around 2.5 times the rent.
Payslips are the best way to gauge just want income is coming in, and asking for a reference from an employer shouldn’t be a problem either. A bank statement is going to give you plenty of information, as will knowing what rent they are currently paying. Taking all of this into account, you can work out how well a tenant can afford your rent.
Landlords can often balk when they think about getting credit checks done. However, it is viral when vetting tenants. If a tenant has endured financial issues, it might influence a landlord’s decision about them. It might be that the economic challenges are actually in the past, with the applicant currently being in a stronger economic position now, in which case there will be proof of that. Either way, it’s important to know.
Contacting the tenant’s last landlord and asking for a reference about them is yet another sensible approach for landlords. If a tenant has triggered other landlord’s troubles, you might not want to risk them doing the same to you. There might be reasons the applicant had trouble with a particular landlord, and of course, you can dig deeper and find out the whole story, but again, the more information you can gather when vetting tenants the better. Yes, it will take you longer, yes it will cost you more, but the cost and the time and energy it will take if you don’t carry out these checks and something does go wrong will be much worse.
If you are a landlord looking for assistance in locating and vetting tenants and you don’t want to do it yourself, your best option is to find a good letting agent to help you. For peace of mind, it’s worth it.