I have about 4 tenants on my short list meaning that they all say they earn enough to pay the rent (using the usual calculation). I know tenants often exaggerate income. This is my question, do I ask each one to evidence their earning now by showing me payslips/bank statements and ask a few questions about debt, any criminal records etc. Or do I give each the rather lengthy tenants application form and ask them to fill it in, this will give me info on everything I need to consider. My concern here is that 3 applicants will not get the house and I’m giving them false hope and wasting their time. What is the best way to do this? Thanks
I work down the list in application order. I do a 10 min phonecall where I ask them key questions like what’s your income, do you have any CCJs etc. The ones who pass that get a viewing so I can suss out their vibe when I meet them in person. If they pass that, I give them a data protection form to sign, then take their ID (or share code/DOB) to check right to rent. I ask them to fill in an application form and give me 6 months of bank statements and payslips (if working) for them and guarantor (if relevant). Then it’s onto checking that their work is bona fide. If all that checks out and I’ve got no issues with bank statements or application form, I do referencing.
I usually do all the above except referencing for a few applicants at once as you never know when one will drop out. I only reference an applicant who I would actually offer a tenancy to. If I have any doubt at any point, i simply inform them that I’m proceeding with another applicant and I never give them a reason nor enter into correspondence with them.
If I’ve got close to referencing for a strong applicant and I have new enquiries, I tell them that they’re in the queue but that it’s likely that an earlier applicant will get the tenancy.
I never take the ad off until check in is complete and at that point, I inform anyone still waiting that the property has been let.
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Check their sources of income. Is it salary, or is it anticipated income from online poker games, or crypto gains, or is it gig economy projections, or is it new business projections (only 1 in 7 new businesses survive for more than a year) . . .
Ask them straight if they have any large unavoidable outgoings like alimony. Ask if there are any predictable events which will effect their ability to pay – are they pregnant and so will soon be unable to work, for example.
Then choose the one with the most headroom, excess reliable salaried income after rent and other financial commitments, and proceed with tenant referencing. I avoid the self employed who may fall off a ladder and be unable to pay the rent for months and months and months as a result.
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Decide which one you like to do business with best.
Then check finances and if all OK take that one.
I would possibly go for the first one that applied if there’s no other criteria.
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Good suggestions from others
Ask each of them to confirm whether figures given are gross or net, include xmas bonuses or not, sources of income and whether they will be willing to be fully referenced including credit checks, employment checks, previous LL checks
Ask if there is anything you should know about like CCJs, a criminal record, or anything else that will show up
Check if they will be able to sign a contract soon (within a week), pay the initial months deposit and security deposit within 2 weeks, and when they actually would want to move in
Explain you are still deciding but dont want to waste their time or yours
If one application just meets the affordability criteria with combined income of 2 people but another easily meets and either of the 2 can afford on their own, 2nd is better, if everything else the same, but as others have said, if affordability similar between the 4 potential applications, choose on other criteria…
Good luck
You might lilely find yourself having fallen foul of the Equalities Act 2010 if you refuse to consider a tenant on the basis of pregnancy or maternity. I’m guessing you would give such an applicant some other reason for not progressing their application but if you have asked them that question you might have already commited an offence.
Pregnancy is a protected characteristic and I agree with Nilesh that if Howard did ask if they were pregnant they have likely already committed a breach of the Equalities Act.
With large fines and civil penalties for cases of discrimination against some applicants, landlords need to up their game and I believe that most could benefit from some training in tenant recruitment in this post RRA world.
@David122 my mistake tho pregnancy isnt mentioned anywhere by @Howard1 or anyone else on this thread so its mention by @Nilesh seens a bit..random
Look again at the second paragraph of Howard’s post
David 240 and Nilesh, actually it was mentioned by somebody in the thread above, so good to bring it to our attention if it is not something we can ask. I have found that I also have to be very careful when I get one of those ‘red or yellow alert messages asking me to respond’. For example, If I have decided not to offer a viewing because it appears the applicant may not be able to pay the rent/bills, I try to respond in a way that does not sound discriminatory. In the past I used to not respond at all but now I get a lot of messages from OR saying ‘response required’ or they will remove my advert.
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Sorry my mistake missed that.
@David122 may have a view but I dont “think” asking about someone 's circumstances and future finances as @Howard1 suggests would automatically be rental discrimination tho, and is legitimate as it pertains to affordability. As a LL you are allowed to consider every case on its merits. If you knew someone was on a temporary contract expiring in 2 months time you would be allowed to ask how they would pay thereafter. If a tenant on UC had nearly adult children and in a month they will become adults so their UC will get reduced you would ask also. Etc. Providing you dont single out pregnant women and ask all prospective tenants if there is anything that may affect their future ability to afford the property you are not discriminating.
Rental discrimination is not asking a question it is deciding to refuse a viewing or to rent or treating prospective tenants differently because of their characteristics. There is some leeway because eg for a prospective tenant with small children it would be reasonable to discuss with them any possible measures to make a place child safe, before signing a contract. After all as LL you also have a duty of care and responsibility for ensuring a property is safe for the tenants.
All the guidance on RRA rental discrimination for those with children or receiving benefits says you judge a case individually and blanket bans not allowed.
Only if a LL had a blanket ban on those who were pregnant or specifically rejected on that basis, would it be discrimination.
But care needed not to give suggestion of discrimination I would simply ask a prospective tenant how they plan to pay if there is a reason to believe something in future may affect their current income. Give them an opportunity to explain their plans and sources of funds. Just like i ask if they have anything in their records i should know about before i do credit checks and referencing. It’s all legitimate enquiry.
Best
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Interviewing someone for a property is akin to interviewing for a job and asking them if they are pregnant is strong evidence if an intention to discriminate. The applicant would be almost certain to win a case under the Equalities Act.
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I asked someone once ,when was the baby due . She replied ,“not at all , I am just fat”. I never asked a female that question again. ( Never asked a man at all !)
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that’s exactly why you shouldnt ask that and have a standard list of questions including eg
'Is there anything you anticipate which may affect your income in the next year ? I am asking all candidates this as part of assessing risk and whether I need rent guarantee insurance. ’
instead. And document your selection process and criteria and responses for all candidates…
You might find someone has just given in notice or is on a temporary contract etc etc. They may lie and say no but at least you have asked which may help if you later have to claim on the insurance
Best