New Landlord seeks advice re procedure/documents/etc.

[Claire73]

Hi all,

Due to the current housing situation and the fact that we have one 2 year old child and another on the way, my husband and I have decided to rent out our 2 bedroom apartment and to rent a much more suitable 3 bedroom house for ourselves (the application for which is already going through)

We want to make sure that we do everything right and we already have a prospective tenant lined up. Our plan is as follows:

- Complete the following Individual Tenancy Application form with the prospective tenants: http://www.landlordzone.co.uk/pdf/application.pdf
- Carry out the ‘Comprehensive Search & Referencing with Fraud Risk Assessment’ at TenantVERIFY.
- Ask tenant to sign Tenancy Agreement and collect the bond (equal to 1 month’s rent).
- Take photographs and inventory, and get tenant to agree and sign.

In addition to the above, I’m considering joining a local landlord’s association.

My questions are as follows:

1. The main prospective tenant does not work, as she says she doesn’t need to - she says that she is financially secure and has enough savings to support herself. Although she is the main tenant, her boyfriend will be sharing the tenancy and he is in full-time employment. How will her employment status affect her credit report and suitability for tenancy? She is currently renting an apartment in the same complex via a large local letting agent.

2. I am aware that I may need Landlord’s insurance of some sort. Our buildings insurance is covered within the service charge and we will be letting the apartment on an unfurnished basis. Can anyone specify what I will need covering in an insurance policy, if we actually need one? We have been recommended ‘Payment Shield’ which offers insurance at £16 per month.

3. Can anyone recommend which Tenancy Agreement to use? There seems to be loads available online, although we have been given one by a friend who currently lets out her house.

4. Can anyone recommend any good Landlord Associations around the Oldham / North Manchester area?

5. I am aware that the bond needs to be protected. Which schemes do you recommend?

Many thanks in advance for your advice!! :D

Claire

[jeffrey]

Besides those five points, read carefully the text of your flat's lease. Does it prohibit or restrict sub-letting?
You may also need to advise insurers (block policy for building; your own policy for contents). Failure to notify could void cover.

[Cem]

1. The main prospective tenant does not work, as she says she doesn’t need to - she says that she is financially secure and has enough savings to support herself.



As per jeffrey if the flat's lease allows you to sublet, I would ask proof for the above, bank statement for her and past 3-4 months payment slips for him.

[Paul_f]

Another thing is you should have an extract of the headlease within your AST if you need to pass on any of the negative covenants such as (not) keeping pets otherwise they might not be enforceable on your tenant; subsequently you might unwittingly be in breach of your own lease.

[Claire73]

Thanks for all your help and advice so far - really appreciate it, and we'll investigate all the information given above over the next couple of days...

In the meantime...

We phoned our prospective tenant today, who is currently renting an apartment through the same letting agency that we will be renting our house from. As she has been away on holiday for 2 weeks, we just rang to check they still wanted to go ahead, and to advise them of the process we would now go through. When I mentioned that we would need to firstly carry out credit checks on her and her boyfriend (at a cost of £30.55 each), she said that she didn't think she'd have to go through the credit check process again, as she had only been checked 8 months previously for the apartment that she is in now. She said that she would ask her boyfriend to see if he wanted to just have a credit check to be done himself and therefore the tenancy to be just in his name.

Is it advisable to just have the tenancy in one name, or should it be in both, seeing as though this will be their permanent residence?

Obviously if she doesn't want to pay for one or either of the checks, we will have to find another tenant.

What are your thoughts? :confused:

[Poppy35]

definately take checks on both and also ensure you take up employment on her partner - she may have savings but she could go and purchase a DB9 tomorrow and bang goes the money -

as for having a credit done 8 months ago....well she could of incurred masses of debt between now and then - if she does not want to have this done then walk away.

[Mrs Jones]

I would also recommend 1.5 month's rent as deposit, and a month's rent in advance of course. And definitely follow the other people's advice on here and do all the usual checks etc. No friends in business!!!

Also - I am curious - why is your prospective tenant wanting to move from the flat she is currently occupying (with established checks, tenancy etc. in place) into yours??

[Claire73]

OK, we've had a call from the prospective tenant and she's agreed that it's fine to go ahead with the credit checks, and she'll pay the money for them.

The reason she wants to move apartments is that our has a balcony, 2 secure parking spaces and the council tax is in a lower band. The rental on her current apartment is only slightly below what we're asking for our apartment, so she's figured it'll be a great move for her :)

[susanne]

get the cash from her for the checks before you do them !

[Paragon]

Good point susanne.

[Claire73]

get the cash from her for the checks before you do them !

They are both coming around to the apartment tomorrow evening with the completed forms, and will pay for the credit checks online using her credit/debit card after I have entered the details online.

Is there anything else you think we may need to do at that time? We have asked for original copies of:

1. Her bank statement (dated within last 3 months)
2. His last 3 months payslips
3. Driving licence / Passport for each of them

I think that's all we need at this stage? :rolleyes:

[ahfh1]

I'd be very cautious on this one. My lodger was a student, so couldn't provide any employment details. I gave her the benefit of the doubt and let her move in as she was able to stump up the deposit and 1 month's rent in advance. However I then found out that her rent came from the DSS which she never told me about, despite the fact that I advertised no DSS! The DSS now no longer pay her rent. She has now missed this month's rent AND has gone out and bought a car! Definitely try and found out how she will be able to pay in the LONG TERM.

[Claire73]

Thanks ahfh1. We're doing all the credit checks through TenantVERIFY, so we'll wait and see what they come back with...

They have given us a cheque for the credit check fee (and before somebody says it... yes we will wait for it to clear before paying for it on our card!!!)

The forms have been completed fully, although I think we may need a guarantor for her. She only stopped work at the end of May, so has only been supporting herself for a few weeks! His income is £17k (which will be checked out with his employer by TenantVERIFY, and also by me if necessary). What are your thoughts?

We have also notified our lender today and applied for consent to let. Will hear back from them in 7-10 days, so keep your fingers crossed for us that all goes well!

Our application for our new house has also gone through today, so we move out of here on 15th July :)