How the Tenant Credit Check works?
The British Landlord Association tenant credit check & reference is an excellent service for landlords and letting agents. The checks include employer references and also, previous landlord reference checks too.
The BLA tenant credit check & reference is specifically designed for the buy-to-let market. Members and non-members can use this service; however, BLA members get a 30% discount on a tenant credit check & reference service.
Carrying out credit and reference checks is crucial; this significantly reduces the risk of ending up with a bad tenant. A check will also highlight any potential threat to your investment.
The British Landlords Association tenant, credit check & reference helpline is open for five days should you need it.
No monthly charges or set-up fees; pay for what you need, when you need it, at a discount.
Benefits of tenant credit and referencing Check
- Check the applicant’s previous address history
- Uncover undeclared/linked addresses.
- Full check on County Court Judgements (CCJs) from court records.
- Check bad credit history such as bankruptcy, IVA, etc.
- Checks electoral role registration.
- Check for aliases.
- Fraud check
- Identity fraud check
- Credit scoring indicates a risk of rent arrears.
- Employer referencing
- The previous landlord referencing
The report will highlight any undisclosed addresses or aliases. It will even find the address history and bad credit history, which some prospective renters try to hide. With our report, you will be able to better judge what the potential renter will be like as a tenant.
Why are a tenant credit check and tenant reference important?
The landlord or letting agent needs evidence that a renter is going to be a good tenant and can reliably make rent payments to the property on time.
In addition to affordability checks and getting references from previous landlords, a Credit Report is also checked.
Some landlords check prospective renters through social media profiles; this can be useful as you can get a good insight into the perspective.
What is included in a tenant credit check?
The information checked comes from public data from the prospective renter’s credit report. They are looking for two pieces of information: Court Records and the potential renters’ Electoral Roll verification.
Court records CCJ’s
Court records are accessed to check to see if the prospective tenant has CCJs or Insolvencies in the renters’ name due to a strong history of missed payments in the past.
Tenant Electoral Roll Listing
The prospective tenants’ Electoral Roll status is checked to see if the address the renter has provided is the one they are living in.
The renter must be shown on the Electoral Roll at the address they have provided as their current address. Once the address is verified, a credit check can be carried out. This address should not show any County Court Judgments (CCJ) or Insolvencies to pass the credit check.
Can you rent a property to a renter with bad credit?
Yes, you can, but you should request the renter to supply a guarantor.
Is there a minimum Tenant credit score for renting?
No. A credit score is a useful tool to monitor an individual’s overall financial health, but the focus for landlords is on the data itself.
Additional renter checks carried out
In some cases, it may be necessary to provide evidence of income and possibly contact prospective tenants’ employers. This may be required to verify the annual salary can comfortably service rent payments. Your combined annual income (if renting in a group) must come to at least three times the yearly cost of the rent.
A tenant’s previous landlord may be contacted to check if the rent was paid on time. It is a good idea to ask how much of the tenants’ deposit was paid back to get an indication of how well the tenant looked after previous properties.
Renter Immigration verification
Landlords are legally required to check whether the prospective tenant has the right to reside in the UK. If the tenant does not pass the check, the landlord or agent cannot legally rent the property.
Source: British Landlords Association
Author: Sarah Featherstone
Date: 9th of March 2024
Disclaimer:
This post is for general use only and is not intended to offer legal, tax, or investment advice; it may be out of date, incorrect, or maybe a guest post. You are required to seek legal advice from a solicitor before acting on anything written hereinabove.
