Landlords Terms of Business with Letting Agents
Just some advice for landlords out there who are presented with the agents Terms of Business (TOB) and on which you should clarify the following points BEFORE you sign any contract. If you don't like what they are offering, please just walk-away; if they want your business they will comply with what I consider are reasonable requests:-
This in not inexhaustible but it will give you a sound basis that keeps you in charge and not the agent. I have nothing against good agents but believe me there are more poor ones than even "above average", let alone outstanding!
- Get the full referencing process defined that the agent will use i.e. referencing company, extent of referencing, and that they will forward these to you for approval before they agree a let. Don't just agree to a "We will fully reference applicants" because that leaves it up to them what they do.
- Make sure they report to you at least quarterly in writing, even if there is apparently nothing untoward and that they confirm that they have made an inspection. Get a schedule of dates inspection are due within your TOB.
- Get ALL fees, and charges itemised that you are likely to incur and make sure that any other charges/fees outside of this will be notified to you in advance and that you have the option to approve or decline.
- Make sure it is clear from the outset that you are NOT tied-in to "continuation fees" should the tenant stay beyond the fixed term and where no new AST is drafted, and that you are notfied of the situation in advance of the end of the fixed term. The agent should also be made to obtain your instructions in writing as to any new tenancy being drafted.
- Make sure the agent gives you a monetary estimation including any VAT that you are likely to incur in fees/charges. (They have an obligation to do this under OFT guidelines).
- If any tenants are not UK based for at least 12 months before the tenancy is to begin, make sure the agent consults you for your written approval . Also have something within your AST that states that if English is not their first language (and you are not satisfied they can understand the tenancy agreement) they provide at their own expense an interpreter to go through the whole document before they sign it. If you have to go to court then this will stand you in good stead when any tenants say they didn't understand the AST.
- Don't take your foot off the pedal when it comes to dealing with your agent. Keep in regular contact and ask for confirmation in writing of any queries that you have raised.
- Don't let the agent "choose" your tenant, but make them forward to you all the references they have taken up on your behalf and insist that they ask for your written approval before granting a tenancy.
- Make sure they don't spend your rental income on repairs etc. without prior approval, and make sure there is a limit on how much they can spend without (I suggest £150).
- Don't trust your agent just to do things on your behalf. They will often do the minimum that you allow them to unless you keep them on their toes.
The advice I give should not be construed as a definitive answer, and is without prejudice or liability. You are advised to consult a specialist solicitor or other person of equal legal standing.