Why don’t agents use ‘bad tenant’ databases?

by Readers Question

12:39 PM, 27th January 2014
About 7 years ago

Why don’t agents use ‘bad tenant’ databases?

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Why don’t agents use ‘bad tenant’ databases?

I’ve discovered that a tenant I’m currently trying to remove is already registered on a ‘bad tenant’ database.

I’ve done a quick straw-poll with some of my regular agents and discovered that none of them routinely check if prospective tenants are on any of the various databases available. Does anyone know why these databases seem so unpopular with professional agents?

I rent a couple of properties, so only need to find new tenants maybe once a year. This makes it un-economic for me to subscribe to all of the half dozen or so ‘bad tenant’ databases I’ve encountered. I’d have thought that if a letting agent is vetting hundreds of tenants a year then it would make sense for them to subscribe to all of them.

BTW, I did ask this question of my agents, but didn’t really get much of answer, they just mumbled a bit and made a few half-hearted excuses. (this includes some of the larger, national agencies as well as the smaller local ones) Why don't agents use 'bad tenant' databases?

The possible reasons I can think of are either a) the letting agent doesn’t really care, and is just looking to claim his fee b) there are too many databases to choose from and the agent doesn’t know which one to use or c) the agent knows the databases aren’t very good.

Or is there something else I’m missing?

Thanks

Lima7

Comments

Mark Alexander

12:44 PM, 27th January 2014
About 7 years ago

It's a very good question.

I can only assume it is because most letting agencies outsource their referencing to the largest RGI providers such as FCC Paragon, Homelet etc.

These companies have been around for several decades and have reliable history on tenants where an RGI claim has been made and also comprehensive databases of information supplied by tenants where they have provided information whilst seeking many tenancies over the years. In the case of FCC Paragon also operate a debt collection agency too.

There are several private "lifestyle referencing" companies entering the market, the biggest probably being LRS. However, they just don't have the track record yet and to my knowledge they don't do full referencing or provide RGI either so many agents see their information as being less reliable than what can be obtained from their existing providers.

I hope that helps 🙂
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Industry Observer

12:55 PM, 27th January 2014
About 7 years ago

Because most of them are either illegal and not recognised and authorised by the Information Commissioner, and the only data that should be held and relied on needs to be 'official' from Court action, not just hearsay and anecdotal stories about tenants from hell etc!!

Ian Ringrose

13:31 PM, 27th January 2014
About 7 years ago

LRS (http://www.landlordreferencing.co.uk) is authorized by the Information Commissioner, and provide normal credit check as well as lifestyle referencing.

The lifestyle referencing is just a simple database of that holds the past landlords Name, Phone Number and email address.
When you do a lifestyle referencing check with LRS, they will give you the contact details of any past landlords they know of, so you can phone up the past landlords for a reference. This makes it a lot harder for prospective tenants to “forget” to put a past landlord on the application form.

The issue is that a lot of landlord decides it is not worth the cost and effort of taking bad tenants to count, therefore there is no count judgment to be included in a normal credit check. This is more of a problem at the bottom end of the market where a lot of agents don’t operate.

You could make it a requirement that the agents you use provide you with any prospective tenants Name, NI, and Date of Birth so you can do a check with LRS yourself.

Most agents do not even check with the land registry if the prospective tenants claimed past landlords own the property that the credit check shows the tenants was living in – so making it very easy for a prospective tenant to get a friend to pretend to be a past landlord and give out a false reference.

However agents are normally dealing with middle class tenants that have rented from other local agents that they trust to give our true references.

Any agent that sub contracts the process of taking up references is just washing their hands of any responsibility, a landlord/agent reference is so much more than a yes/no answer..

Samii Boyd

13:35 PM, 27th January 2014
About 7 years ago

Hi Lima7
I believe the answer to your question is a)that many agents are still unaware of what Lifestyle Referencing actually is b)some may have the (incorrect) view of Industry Observer and c) that they want RGI included within their referencing package.

With regards to the above comment "the only data that should be held and relied on needs to be 'official' from Court action" ; in today's world of landlords not bothering to go to court, the traditional credit reference may not flag up what a lifestyle reference can.

LRS has the largest database of "bad tenants" and is fully authorized by the ICO.
We also welcome our community to upload their good tenants details, as it is important to be able to offer a good rental payment history direct from their previous LL, for those that have had/have a bad credit score.

The only data that we give out (if it is a positive match to an existing entry within the LRS "Lifestyle" database) is the registered rent default and/or property damages, as well as their previous landlords details. This is provided direct from their previous landlord(s) -that have been fully verified as genuine property owners- and entries are regularly updated via our concept of "Real Time Referencing".

Currently LRS offers a full referencing package (Credit Referencing via market leaders Equifax, Lifestyle Referencing, Tenancy & Guarantor Application Form, Employer & Landlord Reference & Accountants Reference) and will soon be able to offer our own RGI product alongside these.

We do have quite a few Agents on board who regularly use our services (have a view of our testimonials here: http://www.landlordreferencing.co.uk/lrs-customer-testimonials/ ) but obviously the more that join the stronger the data becomes.

NewYorkie

12:37 PM, 28th January 2014
About 7 years ago

Reply to the comment left by "Samii Boyd" at "27/01/2014 - 13:35":

I endorse the value that LRS delivers. The people who contribute to LRS are landlords just like us, who have suffered at the hands of unscrupulous tenants, and are looking to establish a repository of bad (and good) tenants who deserve to be identified for all to see.

I have tried to persuade my letting agents to provide me with name(s), dob and NI, but they trot out the usual data protection nonsense.

There are no excuses for agents not using LRS. It is a quick and valuable additional check.

In my opinion, agents just want to let the property ASAP, and are prepared to lay the responsibility for defaulting tenants at the feet of the landlord ...and sell them insurance!

Mark Alexander

13:00 PM, 28th January 2014
About 7 years ago

Reply to the comment left by "Lou Valdini" at "28/01/2014 - 12:37":

Lou, you should change agents!

Agents act for you and it is YOU who is liable if they screw up. They can't claim Data-Protection whilst they are acting as your agent. Any information they hold regarding YOUR tenants and YOUR property belongs to YOU - NOT them.
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Puzzler

7:45 AM, 2nd February 2014
About 7 years ago

Sammi, I don't think Industry Observer is wrong although his/her point is not well put. These databases are matters of opinion rather than fact and a disagreement could result in a bad review, to base a decision on them could be unfair and maybe discriminatory.

Mark, tenants' data belongs to them not to the landlord and the data protection act does apply.

Ian Ringrose

10:43 AM, 2nd February 2014
About 7 years ago

@Puzzler,

Firstly LDS is registered with data protection.

The LRS database does not contain opinions or reviews, it only contains FACTS,
a) The tenants Name, NI number and Date of birth
b) The phone number and email of the landlord
c) Did the tenant own any rent
d) Did the tenant damage the property
e) AND NOTHING ELSE

In other words, less then what would be in a normal landlord’s reference. If I ever got a “hit” when considering letting to someone, the first thing I would do is contact their past landlord to get a full reference, then it is the same as any reference from a past landlord.

It is all too easy for anyone to get a friend to pretend to be a past landlord so defeating all reference checking – LRS just makes this is bit harder.

Romain Garcin

11:15 AM, 2nd February 2014
About 7 years ago

Can a landlord even input such personal data on one of these databases without the tenant's consent?
Those databases are third parties, they do not belong to the landlord. IMHO, when his personal data were collected the tenant must therefore have specifically been informed of the intended use and must have consented to them being shared with such databases. Otherwise, and whether data are correct or not, I'm thinking that the landlord may be breaching the Data Protection Act, and other legislation.

Mark Alexander

11:23 AM, 2nd February 2014
About 7 years ago

The landlord must have consent, this can be a clause in the AST or a standalone document.

Note that all landlords should have a Data Protection Licence as they hold data on tenants. I suspect most landlords don't have one though!
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