Being a landlord can provide you with a nice passive income and be a worthwhile business venture. However, whether becoming a landlord is a success or failure for you will depend on how reliable your tenants are.

First things first, you need to get the right tenants who treat your property with respect without causing needless damage, pay rent on time and avoid arrears, and don’t sublet to others or engage in anti-social behaviour or criminal activity while living there.  Let’s delve more into how to make sure your tenants are reliable.

Use a professional agency

This is our top tip on how to make sure your tenants are reliable! Use a professional and well-reputed letting agency to supply and vet your tenants. The fees will usually cost you 5-12% of your monthly rental income per month, but for most people this cost is well worth the reward, after all, finding good tenants should always be at the forefront of your mind when you have a free property.

If you don’t use a professional letting agency, the responsibility of vetting your potential tenants as well as maintaining your relationship, arranging contracts, securing deposits and making any repairs all fall directly on you. If you are renting out a shared house, you also have a duty of care to vet all of your tenants, making sure that those living in your property are safe and comfortable.

Full property management

Full property management goes above and beyond the things that letting agencies can do for landlords. Opting for full property management services not only gives you a helping hand in vetting prospective tenants to ensure they are reliable, but it also ensures the repairs and maintenance, marketing, paperwork, phone calls, and collecting rent are all taken care of. Therefore, due to this comprehensive service, full property management tends to cost a bit more than hiring a letting agency and you can expect to be charged 12-20% of your monthly rental income.

Request to see documents

If you decide not to use a professional letting agency, it is extremely important to request to see vital documents belonging to your potential tenants in order to vet them thoroughly. Listed below are some of the documents you should always ask to check:

  • As a minimum, you should request details of their last three years of residence, National Insurance number, at least two referees and next of kin details

  • You should state that a copy of a driving licence, passport or other proof of identity is a requirement. Two forms of identity are better than one and should be checked to make sure they match. You also need to check your tenants’ date of birth which can be done using either of these two forms of identification

  • Ask to see the last six months of bank statements and be sure to check that the name and address at the top of the statements match other forms of identification.

Use a tenant credit referencing service

Always use a tenant credit referencing service for background checks, this small investment up front could save you fortunes later on. If the reference comes back with any doubt, disregard the tenant immediately. You want to make sure that your tenants will be able to pay their rent every month and on time so there is no point in running the risk with someone who may not be able to do so.

Renting to students can be a great move for you as a landlord, but vetting their tenant credit references is also a smart idea, you don’t want to be saddled with mountains of unpaid from a student tenant with a history of rent arrears from their previous tenancies.

Jackie Compton CIA Landlords “Students bring life and energy to properties. We ensure landlords have the right coverage for these special tenants.”

Take a Deposit

Take at least six weeks’ rent as a deposit to guarantee that you can cover the costs if your tenants break anything. This is just extra security for your benefit and will help to encourage your tenants to look after your property and behave responsibly. You need to lodge the deposit money into a scheme to enable you to withhold parts of it at the end of a tenancy should you need to pay for any damage.

Serve tenants with a two months’ eviction notice if they break the tenancy agreement

Request that your tenants sign a tenancy agreement with you, and if they break it you can give them two months’ notice to vacate your property and regain possession. The Renter Reform Bill aims to strengthen section eight, allowing a landlord to end a tenancy agreement early if they have a legal reason to do so. 

Check your property is being look after

Make visits to ensure your property is being looked after properly. You are obliged to give at least 24 hours’ notice before you visit your property otherwise your tenants have the right to refuse you entry. When you do request visits, try to maintain a good working relationship between you and your tenants and work around when is best for them. Some tenants can be opposed to regular visits and it is easier if you manage expectations professionally with consideration.

For more information on how to find reliable tenants and how the process works, have a look at our landlord insurance policies.

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