My first ever working tenant!

by Readers Question

14:03 PM, 16th September 2020
About A week ago

My first ever working tenant!

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My first ever working tenant!

I have a flat to rent and had an enquiry from a single lady (with son aged 13) who will be working, but whose rent will be topped up by the DWP. All of my tenants to date in the area have never worked at all, so I have a few questions I hope my fellow experienced Landlords can answer!

1. Do I need a guarantor? As she will still already be claiming some money for rent from DWP, if her hours are then reduced/job lost I presume she will just apply a change of circumstance and get the rest of the rent paid (she has no savings)
2. If I need a guarantor, how do I go about this? Not sure she has family in the country. Could I approach her employer? Anyone had cause to do this?

Anything else I need to consider?

Reluctant Landlord


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Comments

Robert Mellors

17:10 PM, 16th September 2020
About A week ago

The risks to landlords is extremely high and the risk is getting higher with every change the government announces, so you should ensure that you minimise the risk as much as possible.
1. Always insist on at least one suitable guarantor (rent and damage).
2. It is up to the potential tenant to find a guarantor, it is not your job to do this for her.

I would also suggest that you get her (and her guarantor) fully referenced, and take out rent guarantee insurance (RGI).

Dylan Morris

10:37 AM, 17th September 2020
About A week ago

Make sure she has paid her rent to existing landlord on time for the past 12 months. Verify by viewing her bank statements.

Adrian Jones

10:47 AM, 17th September 2020
About A week ago

How do you know the rent will be topped by the DWP?

Will it be paid to her or directly to you?

Gunga Din

11:04 AM, 17th September 2020
About A week ago

Definitely try for a guarantor. It introduces a level of responsibility on the tenant, knowing that defaults will potentially land at the guarantor's feet. This of course can discourage potential guarantors, but my usual argument is that there's no risk because there will never be any defaults will there??!!

You are experienced with DWP and its machinations, but from what I hear they can be unjust and unpredictable.

Some tenants, when asked to come up with a guarantor, say none of their relatives are willing/able. If its made clear the tenancy depends on this, it can change the situation.

Smartermind

11:25 AM, 17th September 2020
About A week ago

Having a guarantor would be ideal, but as you are already experienced in non-working renters, you need to consider weighing insisting on a guarantor against having a long period of void in the tenancy.

homemaker

11:54 AM, 17th September 2020
About A week ago

My experience of this is changes of circumstance - increasing or decreasing hours can result in benefits being suspended and depending on how proactive the tenant is payments may be paused for some time. Having said that my preference is always for a working tenant where possible. On the 2 occasions where I have needed to approach guarantors I have been unsuccessful in getting any payments so personally I’m not sure how much benefit they are.

Robert Mellors

12:03 PM, 17th September 2020
About A week ago

Reply to the comment left by at 17/09/2020 - 11:54
Simply approaching guarantors won't usually achieve anything, but when you have to obtain a CCJ against the tenant then you can also name the guarantors on this, and then the judgement can be enforced against them, e.g. by bailiffs (high court enforcement officers/sheriffs), or by attachment of earnings.

Janet Carnochan

12:54 PM, 17th September 2020
About A week ago

I personally have never managed to get someone with a guarantor. I do however ask the tenant to provide proof of income via bank statements, also a reference from previous landlord and proof via bank statements that rent has been paid on time every month for the last 6 or 12 months. Also if she were to lose her job and get HB, will it cover your rent ( in the area that I live it normally doesn't ).


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