Landlords are often worried about tenants falling behind on rent, which can make managing mortgage payments and other property bills tricky. With the new Renters’ Rights Bill coming into play, it’s more important than ever to find financially sound tenants.
To help you out, here are 5 key checks to consider when you’re looking for reliable tenants:
1. Proof of Income or Employment
- Why it matters: This helps you make sure your tenant has a steady income and can actually afford the rent, along with their other living costs.
- Good for: Finding long-term tenants who won’t struggle financially, reducing the risk of late payments or evictions.
2. Positive Rental History
- Why it matters: Checking if they’ve been evicted before or caused problems can save you a lot of headaches. A good history means they take care of property and pay on time.
- Good for: Avoiding troublesome tenants and protecting your investment.
3. Good Credit Score, No Bankruptcy or CCJs
- Why it matters: A solid credit score shows they manage their money responsibly. No bankruptcies or County Court Judgments (CCJs) means fewer financial red flags.
- Good for: Lowering the risk of late payments or financial disputes, as tenants with good credit are generally more trustworthy.
4. Consider a Guarantor
- Why it matters: If you’re unsure about a tenant’s ability to pay, a guarantor adds an extra layer of financial security. They’ll cover the rent if the tenant can’t.
- Good for: Renting to students, first-time renters, or those with limited credit history, broadening your pool of potential tenants while still having peace of mind.
5. References from Previous Landlords
- Why it matters: These references offer real insights into how a tenant behaved in past rentals – were they reliable with rent, did they look after the property, and follow rules?
- Good for: Verifying information and avoiding tenants with a history of late payments, property damage, or disputes. Positive references mean fewer worries for you.
Even with all these checks, sometimes things go wrong. That’s where Legal Expenses and Rent Guarantee Insurance can come in handy, giving you peace of mind if a tenant stops paying rent.
EMPO’s partner supplier HOMELET can support our members with this to help give them peace of mind.*
*subject to various conditions