Need help? Call us on 0345 301 2889
Get instant help 24/7 on WhatsApp or via our .
Finding the perfect tenant is no easy feat, but being thorough in your search is essential for protecting your property and your income.
If you’re looking for a tenant who’ll pay their rent on time and look after your place as if it’s their own, then doing your due diligence when it comes to tenant referencing is a must.
This guide outlines what tenant referencing and screening involves, where eligibility fits into the process, and how both can support a more secure tenancy.
Tenant referencing is the process by which landlords can find out more information about a prospective tenant, before deciding whether to rent their property out to them.
It unusually involves verifying the identity, financial position, and rental history of a potential tenant to help assess whether they are likely to keep up with rent and take care of the property.
For landlords, tenant referencing is very helpful for reducing the risk of rent arrears, property damage, and disputes from potentially troublesome tenants.
In some instances, completion of thorough tenant referencing is mandatory for landlords to meet the criteria of certain landlord insurance policies, including rent guarantee cover.
Insurers may require evidence that checks were completed before the tenancy began. Without this, claims relating to rent arrears may be affected.
Tenant eligibility refers to whether a prospective tenant meets the criteria needed to move forward with a tenancy, based on the results of referencing checks and screening questions.
In simple terms: referencing gathers the information, and eligibility is the outcome.
If a tenant does not meet these criteria, it does not always mean the tenancy cannot go ahead. However, it may require additional steps, such as a guarantor.
Find out more about The Renters’ Rights Act
| How long does tenant referencing take? |
This depends on the speed of response and who’s carrying out the checks:
|
|---|---|
| How much does tenant referencing cost? | When using a referencing provider, basic checks usually cost between £15 and £40 to carry out. |
| Is tenant referencing a legal requirement? |
Tenant referencing itself is not a legal requirement in the UK. However, some elements within the process are mandatory:
|
| Can landlords charge tenants for referencing? | Since the Tenant Fees Act 2019 , landlords in England and Wales cannot charge tenants for referencing, credit checks, or admin fees. |
Landlords can either carry out tenant referencing checks themselves or use a referencing provider. In most cases, the process includes:
To save money, many private landlords choose to do this themselves. However, first-time landlords without experience in referencing may prefer to use professional referencing tools or services.
Before completing a full-scale tenant referencing check for a potential tenant, asking a few pre-screening questions can be helpful to save time.
This might be as simple as arranging a phone call or sending an email to ask some basic questions. You may want to ask the following to build a clearer picture of your tenant before referencing:
When carrying out the tenant referencing process, use the following list as a guide to ensure you’re gathering all the information you need to make an informed choice:
A tenant may fail at the referencing stage due to poor credit history, insufficient income, negative references, incomplete information, or failing legal checks such as Right to Rent.
You may be asked to provide a reference letter for one of your previous tenants. Here are some pointers to help keep things simple.
You’re not legally required to provide a reference, and you do have the right to refuse. However, it’s common practice and often expected. If you do give a reference, it should be accurate and never defamatory.
A landlord reference letter should include a truthful, detailed account of your experience with the tenant, touching on:
While thorough tenant referencing supports better decision-making, the best protection comes in the form of the right insurance.
Direct Line for Business offers Landlord Insurance designed to support you if things don’t go to plan, including options for rent guarantee cover. Get a free, no-obligation quote today or explore our Landlord Knowledge Centre for more advice.