As a landlord, your property is one of your greatest asset and your tenants are temporary custodians of this asset. It’s important that you have peace of mind with the confidence that your tenants looking after your property as well as you would.
Recent changes in the buy-to-let (BTL) landscape are making tenant referencing even more important than in the past. New right-to-rent rules are one of the most significant. Under the legislation, you—as the landlord—need to have seen your tenant’s actual passport and permanent residency and right to stay documents before handing over the keys. The UK government site has guidance on the following aspects of right-to-rent rules.
It has become essential to use third party tenant referencing agencies either yourself or via your letting agent. This is especially important in this time of increasing fraud which can mask illegal residents, criminals, and tenants with poor records.
Fake documents, such as bank statements, utility bills, and employment history are easily available online so it is wise for you to discuss your service agreement with the letting agency or directly with the referencing agency to confirm that they will provide verification of identity, credit history, mortgage statements, a Cifas fraud prevention check, county court judgments, employment references, and a renting track record—important verification that a prospective tenant is worthy of the value of the asset being placed in their care.
It is important to make sure agencies are complying with their tenant referencing obligations and agree to bill you only when your tenant’s first payment of rent has been made, not before.
If you wish to make an agreement with a potential tenant who checks all the boxes but has an insufficient credit history, consider having a guarantor in place to cover in the event of default.
Some letting agencies provide insurance for protection against rent arrears and also to cover costs of an eviction for references they have passed. Rent guarantee insurance is approximately £100 per year and is tax deductible.
While vetting tenants may seem an intensive and overly-complex aspect of the landlord’s burden, the cost and aggravation—should things go wrong—can be devastating. Talk to your letting agent or referencing agency to ensure your protection is iron clad.
To ensure your further peace of mind, Besmove has the property management experience and resources to deliver the greatest possible return on your rental properties with the following promises:
Call the property management specialists at Besmove today to learn how you can survive AND PROSPER in today’s property marketplace.
For more information on the topic you can check out the reference articles;
In 2015, the UK government launched a campaign of measures giving priority to the interests of first-time buyers over that of buy-to-let (BTL) investors. Since that time, BTL investors have weathered a sea change in the market that has introduced the following constraints:
In May 2017, the Financial Times Advisor published a comprehensive special report designed to give the UK’s BTL investors a range of expert opinions—in the areas of law, finance, and brokering—on the full impact of the changes.
Sharing our notes
There is consensus that the tax and legislation changes have implications for buy-to-let investors at all levels of complexity, Besmove has identified the top implications for the houses of multiple occupation (HMO)* investor:
*Link here for a detailed breakdown of HMOs and complex buy-to-let scenarios.
Where from here?
With the buy-to-let environment now having to operate more like a business than a lucrative hobby, investors are compelled to run increasingly lean, efficient operations. Besmove has the property management experience and resources to deliver the greatest possible return on your rental properties with the following promises:
Some homeowners are experts in this field; these people will not experience difficulties in this aspect. In the case of other homeowners who are not professional bookkeepers, recruitment of an accountant may be a fantastic choice. A property management company can also take off the stress from you if you are willing to hire their services. Best of all, these services can be tax deductible, so you could get this done without losing your profit margin. In Fact, you may increase your profit margin through increased rent and lower vacancy rates.
Living close to the leased property will offer you the chance to visit the place for inspections, maintenance, and collection of levies. Moreover, if you live far from the property, you have to consider the time utilized in traveling and the costs associated with the trip. However, if the space of the property is a large one, you may be tempted to visit often, and that could be catastrophic. It is essential to have a schedule for monthly visitation to check the property.
The process of finding reputable and trustworthy contractors may be tough and time-consuming. You are likely to engage the services of employees who are not committed to your vision; these people will cheat you and perform ridiculous tasks and offer you a wrong quote. You need to understand that you cannot shy away from the issue of repairs and maintenance in property management. Engaging the services of a reliable property management company will ensure the task in your property is carried out at a fast pace without compromising quality.
This question is complicated, and it is crucial to provide adequate honest answers in this regard. As a homeowner, you are responsible and answerable to calls from your tenants, and you must understand that your holiday, special moments, vacation and other times in your life must not prevent you from taking care of the urgent needs of your tenants when there is any need. It is essential to note that you will not get called to fix one or the other more often, but if there is a call for you to set it, be fast about the process.
You must ensure tenants pay as soon as possible by making use of gentle reminders of their indebtedness. If the application of friendly reminder does not work, you may have to employ legal means. A property management company will help you implement the principles laid out in the agreement with the tenant.