When renting a property, tenant referencing is an important part of the process. This ensures that tenants are reliable, financially secure, and a good fit for the property before agreeing to let it go to them. Tenant referencing is a vital step to help landlords protect their investments and provide them with peace of mind before handing over the keys.
In this guide, the experts at Shortland Horne look at what tenant referencing involves, why it matters and how landlords can get it right.
What is tenant referencing?
Tenant referencing is the process of assessing a tenant’s suitability to rent a property. It involves verifying key details such as identity checks, financial situation, rental history and employment status. With this information, landlords can make informed decisions about letting their property.
Why is tenant referencing important?
Tenant referencing is more than just a box-ticking exercise – it helps landlords safeguard their investments. Tenant referencing can help:
- Mitigate risks: Avoid issues such as rent arrears, damage to property and disputes over property conditions.
- Ensure legal compliance: Using checks such as the UK’s Right to Rent verification can help confirm that tenants have the legal right to rent a property.
- Protect your investment: By ensuring tenants can meet rental obligations.
- Give confidence: Landlords can rest assured their tenants have been thoroughly vetted.
Key stages in tenant referencing
Tenant referencing involves several key stages, including:
- Identity verification using official documents such as a passport or driving licence to ensure you are dealing with the right person and prevent the risk of fraud.
- Credit checks with financial bureaus to highlight any red flags, such as missed payments and poor credit ratings.
- Employment and income checks are needed to help confirm their financial security and ensure that they can afford to make rent payments.
- Landlord references to review tenant rental behaviour, such as how they looked after the property and if they paid their rent on time.
- Right to Rent checks such as checking visas and residence permits from non-UK nationals to ensure tenants have the legal right to rent.
Common challenges of tenant referencing
While most of the time, tenant referencing checks run smoothly, sometimes there can be some hurdles to overcome. Some examples of these challenges include:
- Incomplete information: Ensure your tenant application form includes all the documents you need and that tenants complete and supply everything.
- Failed checks: If a tenant fails a credit, employment, or landlord check, you can consider using a guarantor to provide additional security.
- Time constraints: Ensure you set deadlines for when the information is needed to help speed up the process.
Finding the right tenant is one of the biggest concerns for landlords. However, a thorough referencing process can help avoid common pitfalls and protect your property.
Are you thinking about letting a property in 2025?
If you are thinking about letting a property in 2025, we can help you manage all aspects of renting out a property, including tenant referencing.
Once suitable tenants are found, we will confirm the information with the landlord. We will check their references thoroughly, including credit checks, to confirm that the applicant is in a financial position to rent your property.
Our award-winning team can help landlords ensure they are fully protected and compliant, giving you peace of mind that your investment is safe. Please get in touch with Shortland Horne today to discuss your requirements.