Thursday, 3 August 2017

Ask Andy – ‘What do I need as a Warrington tenant to pass references?’


Question:
‘Hi Andy,
I want to move out of my parents’ house for the first time and into a rented house, but because it’s my first time renting that I’ll struggle with references with landlords and agents. What do agents and landlords want from references and what do I need to pass references?
Thanks,
John’

Andy’s Answer:
First of all, good luck in finding a new home! There are many parts to references but hopefully I can put your mind at ease.
I would say there are four main components to references: affordability, credit checks, income references and landlord references. Obviously if you have never rented a property before then you won’t have a landlord, so this part wouldn’t apply to you at the moment.
Agents and landlords should also check your eligibility to reside in the UK with what’s called a ‘right to rent’ check. This is pretty simple and you can use a range of documents to show this – the simplest being a passport/identification card and visa if applicable.

Affordability
The standard test for affordability is that your annual income must be 30x the monthly rent. For example, a property which is £500pcm would require an income of £15,000 per annum. If you were moving in with someone else, the income between you per year would have to reach that total. This is to ensure that the rent is affordable for you.

Credit Checks
A credit check is normally conducted to check that you have no history of unsatisfied county court judgements (CCJs), insolvency voluntary agreements (IVAs) or bankruptcies.
Dependant on the landlord and on the agent, if an applicant has a CCJ, they may accept your application subject to some criteria – the total is under a certain amount, it isn’t for unpaid rent, even if you have been making regular payments towards the debt and can substantiate that, etc.
In some cases, some agents/landlords will accept a failed credit check with a guarantor. However, in most cases, the guarantor must be a homeowner, pass the same affordability and income references as a tenant and then sign a deed of guarantee for the tenancy.

Income References
Your income references link in to the affordability checks.
If you are employed, your annual income will be checked, your contract length (whether you are permanent or temporary staff and to ensure your contract runs for at least the term of the tenancy). Your employer will also most likely be asked whether they consider you to be a trustworthy individual.
If you are self employed, to pass references you will normally need at least 12 months worth of accounts. Providing your accountants’ details is normally required in conjunction with bank statements and self assessments to evidence your income.
For those applicants who are in receipt of benefits, they will need to produce awards letters to evidence that part of their income.
While this is not an extensive list of applicant’s situations, these are the most common ones.

Landlord References
Landlord references are normally comprised of the following questions:
·         Start date of tenancy, length of tenancy and end date of tenancy (if notice has been given)
·         Rent during the tenancy
·         Were there any rent arrears during the tenancy
·         Were there any late payments/issues with rent payments
·         Were there any damages during the tenancy/general condition of the property during the tenancy
·         Would you rent to this tenant again
·         Any other comments

This appears like a lot of information, but your agent or landlord should be able to talk through their specific requirements with you and help you in your applications. I wish you the best of luck house hunting!

If you have any further questions, feel free to drop me an email or give me a call. Email me on andy@hamletwarrington.co.uk or call on 01925 235338. If you are in the area, feel free to pop into the office – we are based on 6 Bankside, Crosfield St, WA1 1UP. There is plenty of free parking and the kettle is always on.

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