Referencing Services for Landlords

Referencing Services for Landlords

17:40 PM, 8th July 2013, About 11 years ago 4

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Referencing services for landlords come in several varieties and with numerous options and price structures. 

You can get anything from a credit check for a fiver through to full referencing which guarantees rent on the due date if your prospective tenants and guarantors are considered to be a good risk.

The larger referencing companies have been around for several decades and are used by literally thousands of letting agents across the UK. They have, therefore, also developed huge databases over the years of bad payers, anti social tenants and tenants who have caused wilful damage to landlords properties.

If you are offered referencing for under £10, chances are that you will get what you pay for which at best could be described as an indicative report only. A company which previously provided lifestyle referencing free of charge now only offer this service when combined with a £4.99 credit check for example.

The advice from Property118 is to pay slightly extra and buy the real thing. If you are heavily reliant on your rental income and could not afford the legal costs associated with evicting a bad tenant we also recommend you to purchase rent guarantee insurance. The entire package is generally available for less than £100 a year. Do check the small print on RGI policies though as your claim might not be valid unless you follow time sensitive claims processes.

As of next month (August 2013), a new service will be launched into the market for complete peace of mind. It is a rent collection product with a difference; in that rent is paid to the landlord on the due date whether it has been collected or not. The company offering the product is new to the market but the scheme is underwritten by FCC Paragon, established in 1996 and regarded by many in the PRS as one of the UK’s most established referencing companies. The legal services for possession are outsourced to Landlord Action.  Rent continues to be paid on the due date until such time as possession is recovered, all at the expense of the underwriters. This scheme will be competitively priced at just 5% of rental income when it is launched towards the end of August 2013. It’s an ideal half way house in terms of pricing between self management and full property management, however, the major benefit is the certainty of cashflow. For more details see Referencing Services for Landlords

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6:11 AM, 9th July 2013, About 11 years ago

Worked out that would cost me £1.83 per day on my rents.
That is pretty good; especially if HB tenants were covered.
I suspect they are NOT.
But it certainly brings something new to the table and sounds like a fairly cheap solution to rent issues.
I reckon most LL lose more than £670 per year in voids on my rents

Mark Alexander - Founder of Property118

7:29 AM, 9th July 2013, About 11 years ago

Reply to the comment left by "Paul" at "09/07/2013 - 06:11":

The product is aimed at the mid to upper and of the market Paul so you are right that benefits tenants are unlikely to be accepted, unless of course they have a suitable guarantor. I suspect the product will do well for people who prefer certainty as opposed to insurance when it comes to rental cash flow. Rent collection is also a part of being a landlord which a lot of people are fearful of. Some people like to meet tenants and don't mind organising maintenance but realise that it's the advertising , referencing, deposit protection, tenancy agreements, rent collection and evictiond where most things can go wrong. This product wraps up all of those requirements very neatly into one package.

11:20 AM, 9th July 2013, About 11 years ago

Being an owner of a tenant referencing company I like to go that extra mile to ensure we do everything we can to protect my clients reputation and their clients properties.

However one thing I do know is that it is a joint effort of all involved, the tenant, us, the agent and the referees.

So imagine my concern when a landlord recently gave a very negative reference for a current tenant. Obviously due to the nature of the information this tenant was declined and not even rent up front or a Guarantor would protect this landlords property.

My staff thanked this landlord for his honesty and helping us protect our client. We explained to our client about the reference and we assumed that was the end of it.

I was wrong, the Landlord then decided to call back about 1 hour later and ask to retract the reference as they were now worried the tenant would not be able to leave their property sooner rather than later.

How concerning is that??

Are landlords telling us the truth? This industry will always have rent arrears but we all need to get on the same page and make sure that rent arrears occur due to an unforeseen circumstance.

After this happened, I started asking a few questions regarding what other steps we can take to help reduce risk even further in the future. One step we have introduced is asking the tenants to provide Landlords details for all the rental properties over their last few years.

Why? The previous landlords have nothing to lose by telling the truth!!!

3:38 AM, 10th July 2013, About 11 years ago

Reply to the comment left by "Ross" at "09/07/2013 - 11:20":

The dilemma for a LL if they have a tenant who they want rid of; but can't get rid of them if they give a truthful reference then the LL has little choice than to lie or rather be economical with the truth
I would as I would not wish to go through the experience of eviction.
If a LL is going to just rely on a previous LL reference then that is his lookout!
The pathetic eviction laws force LL to lie or otherwise the previous LL could be stuck with his wrongun tenant until he can be evicted.
This could bankrupt the LL.
Far easier to lie and get rid of the tenant easily.
If the next LL has problems with the tenant he cannot really blame the previous LL
I think you will find that once a tenant has vacated; if you contact the LL again you will get the full story on the tenant.
Never ever heard of any LL being prosecuted for giving a less than full appraisal of a tenant they once had.
Prospective LL cannot rely on an existing LL reference until the tenant has vacated.
Only then might they get the truth!

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