Referencing before viewings – everyone’s a winner!

by Mark Alexander

11:13 AM, 20th March 2015
About 4 years ago

Referencing before viewings – everyone’s a winner!

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Referencing before viewings – everyone’s a winner!

I recently wrote about a scenario where I had 60 viewing requests and 19 viewings in one dayReferencing before viewings - everyone's a winner

Great you may think, and yes it was 🙂 Demand was high and two people even ended up offering me £75 pcm over the asking price.

HOWEVER, the first couple failed referencing due to having three months rent arrears and the second couple failed due to an undisclosed CCJ. This cost me time and has lead to an unwelcome delay and void period.

Thankfully the third person referenced up and is now proceeding at £25 over asking price – PHEW!

It got me thinking though, and I have suggested this to the Directors at LettingSupermarket.com

Where demand is so high, why not offer the interested parties an option to get ahead of the game by charging them a small fee for refencing in advance of viewing the property? Clearly this will only work when demand is very high because some prospective tenants will not go for it. That doesn’t have to exclude them from viewing though.

My other thought is that tenants could be given a copy of their reference. This could come in very handy for them when they go to meet other landlords and agents too. If the reference doesn’t make for good reading at least they will know.

For me, as a landlord, it potentially speeds up the entire process.

For the agent it saves wasting time and earns them extra money.

From what I can see, everyone’s a winner.

What are your thoughts?

Regards

Mark Alexander – founder of Property118.com and non-Exec Director (Consultant) to LettingSupermarket.com

 



Comments

Monty Bodkin

11:25 AM, 20th March 2015
About 4 years ago

Hello Mark,

I carry out a comprehensive set of questions before wasting time with a viewing.
Some of those questions are -
Why are moving? Have you ever been in rent arrears ? Do you have any adverse credit history?
I make it very clear that I will be charging them a non refundable fee for verifying these things should the tenancy progress.

There is something niggling me about charging fees as you suggest being illegal.

Mark Alexander

11:37 AM, 20th March 2015
About 4 years ago

Reply to the comment left by "Monty Bodkin" at "20/03/2015 - 11:25":

Hi Monty

The questions you ask are good ones, I'm sure you ask many more too. The issue is that some people tell lies, that's what's caused me grief this week.

I take your point on legality which is why I'm merely floating the idea. I will be looking deeper into the law side of this over the weekend. My gut feeling though is that whilst it would certainly be illegal in Scotland, in England and Wales I think it will be OK, especially as it is only an option for tenants to consider in order to get ahead of the crowd (i.e. not compulsory) and also that they actually get something for their money, i.e. the referencing report.

Thanks for your feedback, hopefully there will be more, particularly if anybody can point me to any relevant legislation or case law 🙂
.

Monty Bodkin

11:38 AM, 20th March 2015
About 4 years ago

There is something niggling me about charging fees as you suggest being illegal.

The following is what I was thinking of. What you suggest might cross that line.

file:///C:/Users/DemoAdmin/Downloads/h_renting_from_a_letting_agency%20(1).pdf

A letting agency cannot charge you:
 to register with the agency
 for providing a list of properties available for renting.
It is a criminal offence for an agency to make these charges.

Chris Sheldon

11:41 AM, 20th March 2015
About 4 years ago

Reply to the comment left by "Monty Bodkin" at "20/03/2015 - 11:25":

Hi Monty,

I too have a feeling that you aren't allowed to charge fees upfront. I believe it was brought in to combat issues with property sourcing and due to the loose wording applied to any upfront fee related to finding a property.

I would be interested in any links to case law relating to the above.

We do ask these questions but some people are unaware they have ccj's and some people are less forthcoming with the truth particularly when moving due to rent arrears, hence the stringent referencing process which we have adopted.

Legalities aside, from a landlords point of view I can see the benefits, however I think you will reduce the marketability of your property and many agents/landlords will not allow documentation to be transferable due to the possibility of forgery.

Either way I'd be interested in peoples views on both the legalities and the idea.

Chris

Monty Bodkin

11:45 AM, 20th March 2015
About 4 years ago

Reply to the comment left by "Mark Alexander" at "20/03/2015 - 11:37":

The issue is that some people tell lies, that’s what’s caused me grief this week.

I fully agree with that Mark.
That is why banning fees completely is such a bad idea.
The liars have nothing to lose.
Good tenants end up paying for the bad ones.

Mark Alexander

11:45 AM, 20th March 2015
About 4 years ago

Reply to the comment left by "Monty Bodkin" at "20/03/2015 - 11:38":

Hi Monty

Your link doesn't work 🙁

My proposal is very different to what you have quoted as being illegal though.
.

Mark Alexander

11:48 AM, 20th March 2015
About 4 years ago

Reply to the comment left by "Monty Bodkin" at "20/03/2015 - 11:45":

Here, here on that point Monty. Thank heavens my properties are not in Scotland!

I can think of several other reasons why banning fees is a bad idea too. However, that's has been thrashed to death on several other threads here at Property118 - see >>> http://goo.gl/Kn46Xp
.

Caroline Read

17:01 PM, 20th March 2015
About 4 years ago

Hello Mark,
Just a quick awarding of a GOLD star.
After your glowing report of LettingSupermarket.com (yes I know you are a director) I contacted them to arrange to let and manage one of my favorite properties. The old agent hadn't let it in 9 weeks even after I had forwarded over 35 leads of interested people. Yes, nine weeks...why I let it go on for so long, I cant quite fathom
...anyway..
I had a fabulous chat to Tony, he arranged for Geoff to visit the next day. Geoff loved the house, he couldn't work out why it was empty either. He took some excellent pictures and the house was listed the same day...Very Impressed and I am very confident that the house will be let soon...:) 🙂

Mark Alexander

17:45 PM, 20th March 2015
About 4 years ago

Reply to the comment left by "Caroline Read" at "20/03/2015 - 17:01":

Delighted to hear it, please let me know how you get on.
.

Jireh Homes

20:21 PM, 20th March 2015
About 4 years ago

Recently undertook advertising of property and referencing of potential tenants (in Scotland) and issued an "Application Form" containing similar details as Tenant Referencing Form. Was very useful in the face-to-face discussions with applicants and led to a successful formal reference. So although not able to use for Credit Check with the Agencies, with a permission clause I guess it could be (as these alone are a small cost). And I could have followed up on previous Landlord (although they may glad to see then move on!).

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