Should I proceed with offering a tenancy agreement?

Should I proceed with offering a tenancy agreement?

9:29 AM, 23rd July 2021, About 2 months ago 46

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Hi Folks, Some sage advice please:- I’ve just referenced two lovely prospective tenants who have failed the comprehensive referencing.

They’re both clear of debt and have no CCJ’s,  there are good previous Landlord’s references and generally all-around decent reports. Both are considered “Medium Risk” according to the reports.

One prospective tenant is currently in receipt of Universal Credit, but anticipates returning to work as a self-employed chef (cooks for private dining) shortly and the other is in full-time employment.

According to the Rent Affordability Calculator, their combined incomes are just about sufficient to cover the monthly rent. Everything else on the reference reports are fine, but the referencing company has suggested that I proceed with a guarantor, which the candidates are unable to provide.

The candidates are offering to pay for a year’s rent in advance.

As I intend to purchase Rent Guarantee Insurance and as a condition of obtaining this, the candidates must pass the referencing, I’m apprehensive in offering them a tenancy.

Any suggestions would be gratefully received.

Thanks in advance!

Mark



Comments

by James Mortimer

12:26 PM, 23rd July 2021, About 2 months ago

If the reference company says no then I would tend to say no too, or what's the point in using the system in the first place

by Helen

12:30 PM, 23rd July 2021, About 2 months ago

If they don't pay their rent Section 8 is the path to follow. Section 21 is for 'no fault' ie if the landlord wants the property back for some reason. However, this is a long and expensive process and not worth the risk. Attempts to get lost rent back from tenants is never worth the legal costs. I had to take a chef to court to evict him after non payment of rent but they can get cash jobs so even if you can find them after they've left, getting an attachment to earnings order is very hard.

by Monty Bodkin

12:31 PM, 23rd July 2021, About 2 months ago

Reply to the comment left by Smartermind at 23/07/2021 - 12:26
Why take the risk?

by The Property Man

12:42 PM, 23rd July 2021, About 2 months ago

A tenant who pays 6 months or 12 months in advance doesn’t really mean nothing in my opinion as you are just prolonging a problem for in 6 to 12 months time.

I have taken tenants on it the past who have paid 12 months upfront then they stopped paying after the 12 months and I had to evict them.

by Dancinglandlord

12:42 PM, 23rd July 2021, About 2 months ago

I am mindful of the company who did a pitch to the Manchester Landlords conference a couple of years ago, offering tenancy checks using an algorithmic analysis of a potential tenant's neuroticism - based on their Facebook postings! Something tells me that gut instinct would be as good an indicator as some dubious techie programming behind a software credit reference. I too go on gut instinct sometimes. But I hear what others have posted - that if you don't have to take the risk, then maybe it is better not to - given the law on evictions these days. The advice to try another reference agency seems like a fair option to me.

by Parvez Hemnani

12:46 PM, 23rd July 2021, About 2 months ago

Reply to the comment left by at 23/07/2021 - 12:21
Agree with Ashleigh. Having good references is not bomb proof. I took on a couple of tenants who passed all the tests and when their relationship broke down, I was the ultimate loser to the tune of approx. £10,000 so absolutely agree good references are not bomb proof so use a bit of gut feel and common sense. Good luck!

by Shirley Harvey

13:15 PM, 23rd July 2021, About 2 months ago

We rented our property to a couple who failed the referencing check, but offered a year's rent in advance. We used our 'gut' instinct and signed them up for 12 months. The following year, they paid another 12 months in advance. They then left as they purchased a property just round the corner from our property (due to coming into inheritance). The house was immaculate when they checked out. We were very lucky!

by Darren Peters

13:41 PM, 23rd July 2021, About 2 months ago

I wonder could you ask them to give you written notice to quit today for the end date of the tenancy in a year's time so that they have obliged themselves to leave after the year. You can always renew the tenancy if there have been no red flags over the year but if there are problems you're on stronger ground if they decide not to leave.

As they will have paid the rent upfront, no point paying out on the insurance; they will be liable for double rent for every day they didn't leave after they said they would.

by Helen

13:46 PM, 23rd July 2021, About 2 months ago

Reply to the comment left by Shirley Harvey at 23/07/2021 - 13:15
It is such a shame when landlords consider ourselves 'lucky' when tenants do what they are supposed to do, in other words, pay their rent and leave the property in good order when they leave.

by Clint

14:03 PM, 23rd July 2021, About 2 months ago

I cannot believe that about 90% of landlords on this forum are hesitant. I would say if any of you get such tenants willing to pay one year's rent in advance and don't want them please refer them to me.

I would gladly accept them with very few questions asked. As long as they meet the right to rent criteria they would be fine for me.

I think ultimately, it depends on your business strategy and gut feeling. I feel almost certain from the description you have provided, that they will be most suitable tenants especially since they do not have CCJs, no debts, appear to be lovely people, good reports and landlord references, medium risk not high risk.


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