The Importance of the Letting Decision
Verifying and selecting tenants is the most important task you do in the whole process of letting a property. Lumber yourself with a bad tenant and it can cost you a small fortune – lost rent, damage to your property and legal fees for evictions. It can take many months to remove a really determined bad tenant.
If you have followed a logical and systematic process, the tenant checks and referencing arguably being the most important part, you will have more than enough evidence on which to make an objective and accurate letting decision.
This, in the end, comes down to your own judgement of all the factors and your “gut feeling” about the individual. Are you a good judge of character? You’ll soon find out! TenantVERIFY® Advice on Tenant Screening, 20 point Checklist.
Try not to waste too much time in this process – you may lose a good prospect. Try to do as much as possible over the telephone or by e-mail rather than wasting days waiting for letters to arrive.
Once you have decided, inform the prospect that they have been successful in meeting your requirements ahead of the other prospects – most people will be happy and relieved that they have qualified and will want to go through with it quickly.
Don’t relax too soon though – you should still be taking enquiries until your first qualified tenant actually signs the agreement – keep your eyes and ears open!.
The Viewing is an ideal time to assess your prospect
Experienced landlords and agents will develop their own style when showing prospective tenants a property. Be positive about the property and emphasise its good points.
While you’re selling the property’s merits, now is your opportunity to observe and learn about the prospect.
Tell-tale signs are there for the observing:
- Reliability – did they turn up on time, unless they had a good reason to be late.
- If they arrive in their own transport, observe the prospect’s car – is it clean and tidy?
- Personal appearance – is the person smart and clean and did they make an attempt to make a good impression?
- Attitude and behaviour – is the individual polite and respectful both of the landlord/agent and the property. Care with wiping their feet before entering, handling possessions and furnishings, not smoking.
- Tenant’s positive or negative reactions to the property, its facilities and to letting arrangements?
The Application Form and Interview
The Application Form and a brief Interview should be sufficient to tell you all you need to know about the background of your prospect.
It’s a good idea to have a standard interview form with pre-prepared questions – see Useful Documents here
Not only does this prevent you from forgetting to ask important questions, by recording briefly the replies, it will prevent claims of discrimination later. You will have vital evidence to show that you put all the applicants through exactly the same selection process before making a decision.
The two things you can discriminate on are:
- Affordability, can the applicant given their stated and confirmed income afford the rent?
- Is the letting accommodation suitable in terms of size and situation from the prospect? For example, putting a family into a one-bed flat would not be appropriate.
Again, to avoid charges of discrimination you should be in a position to justify on paper any decision you make and you should give priority to the first applicants that qualify.
Your Decision is Final
Once you have made your decision and the paperwork (agreement) is signed there’s no going back. You will have to live with the consequences at least for the duration of you contract which will be for a minimum of six months.
It is a good idea to limit tenancies to six months (or 12 months with a 6 month break) until your new tenant/s have proved themselves.
Those involved with lettings should take care not to be accused of discrimination on two counts: (1) when they advertise for new tenants in newspapers, on the internet or in newspapers, or even in a paper shop and (2) when they screen, interview and select tenants.
It seems clear that the law on equality applies to landlords and agents (including live-in landlords accepting lodgers), and also tenants looking for house-share partners.
The main discrimination legislation is as follows:
- Sex Discrimination Act 1975
- Race Relations Act 1976
- Disability Discrimination Act 1995
- Equality Act 2006 and 2010.
The Equality Act states that it is “unlawful for a person who has the authority to dispose of premises (e.g: by selling, letting or subletting a property) to discriminate against or victimise someone else in a number of ways including by offering the premises to them on less favourable terms, by not letting or selling the premises to them or by treating them less favourably”.
There are legal obligations on landlords and agents as service providers and employers, to take reasonable steps to ensure that people are not discriminated against directly or indirectly due to their race, colour, gender or disability.
See our User Guide here
Our Advice on Tenant Screening, a 20 point Checklist here