Income check on prospective tenants

PIppa

Hi

I live abroad and rent out my house in the UK. My house is managed by agents but I like to agree the details of new tenants.

Prospective tenants want to undertake a tenancy next month. They both work, she is employed, he is self employed. She is also pregnant.

Because the woman's income is enough to cover the rent the agents are not doing an income check on the man. The agreement is to be in joint names. Am I right to be concerned about this?

The agents seem pretty dreadful so I'm not filled with great confidence.

Thanks for any advice.

ognum

You as a landlord have the right to refuse any tenants, if you feel uncomfortable just say no or ask your letting agents to do further checks, they work for you!

BitterAndTwisted

If the woman's income is sufficient to cover the rent I wouldn't be concerned if they are both signing up to a joint-tenancy. That she is preggo and will presumably be on mat leave or not continuing to work at all would concern me. I'd want to see the income-check on the partner and have sight of both of their bank-statements for the last six months plus the credit-check documentation for both of them.

Do not rely on the advice of the agent: their main concern is getting the mark-up on the credit-checks and referencing and your nice, fat tenant-finding fee. Friends have been totally scuppered by an agent's actions when finding a tenant for them. A most unsuitable tenant who couldn't afford the rent from the start. If they'd seen his bank-statements and wage-slips at the beginning they could have figured that out for themselves and saved a lot of stress, anguish and expense when having to evict him.

The rental-market is bouyant at the moment so you shouldn't have to take the first tenant who comes along.

Better_Days

PIppa wrote: »

Prospective tenants want to undertake a tenancy next month. They both work, she is employed, he is self employed. She is also pregnant.

Because the woman's income is enough to cover the rent the agents are not doing an income check on the man. The agreement is to be in joint names. Am I right to be concerned about this?

Yes, I would be concerned. The woman may decide to stay at home rather than go back to work after her maternity leave finishes.

Income from self employment tends to be less stable and reliable (depending partly on what the person is doing - do you know what it is?) I would be tempted to ask to see a copy of the man's accounts for the past say 3 years to get an idea of his profit (not turnover) and also fluctuations in his business. Bear in mind that tax and NIC will come out of profits too. How long is the proposed tenancy period?

PIppa

Hi

The agents say the man is a self employed electrician. When they came to view the house, the agents failed to show and the current tenant was kind enough to show them around. The agents aren't aware that I know this. It was only the woman that went to view the house and she told the current tenant that the man is a self employed builder so I'm getting conflicting information.

The woman also requested that I fit a second hand rail on the stairs because she is pregnant. I haven't accepted them yet as tenants but I refused this request.

My instincts are telling me to refuse. I feel I am having to do the work that I pay the agents for.

Thanks for all of the advice.

ruggedtoast

Oh for God's sake. These things really annoy me.

A perfectly normal couple have viewed your house, one of them has already passed the income check for both of them, but has the temerity to be pregnant and dare to ask for a handrail. So you're going to refuse them altogether.

I think they've had a lucky escape from you and the "pretty dreadful" agents you have seen fit to appoint.

Better_Days

ruggedtoast wrote: »

A perfectly normal couple have viewed your house, one of them has already passed the income check for both of them, but has the temerity to be pregnant and dare to ask for a handrail. So you're going to refuse them altogether.

Yes but it is the woman who has passed the income check and it is likely that her income will be reduced when she is on maternity leave, and as I said previously she may chose not to return to work. It is therefore perfectly reasonable to seek more info regarding the man's income as he may well end paying part or all of the rent.

If the agent has been engaged and paid to show prospective tenants round the property, then they should fulfil that obligation.

A self employed builder could mean a lot of things, he could be a sub contractor working on a daily or weekly basis, and consequently work isn't guaranteed. Or he could have a longer contract with a large company. Or he could run his own business building houses. An electrician is probably more skilled and not so dependent on the construction industry, but the work may still dry up.

OP, you may wish to meet the prospective tenants yourself to see what they are like. If you are not happy with them or the financial checks then refuse them as tenants as you are perfectly entitled to do.

If you think they are ok but want further financial safeguards you could ask for 6 months rent up front or insist on a guarantor (but get it done properly!).

I think you are right to be cautious. No point in wishing you had been more careful a few months down the line when they haven't paid their rent. Good luck in sorting it out.

BTW - there are a few threads on here describing the problems that have been encountered with Letting Agents - have a browse through, you might find some of the info useful.

Whoops, sorry - missed the bit where you said you live abroad. You need to be even more careful then, as it would be more hassle to sort out problems from afar. Plus LA may not be so diligent if they think you are not around to check up on their work (perish the thought!). You seem to be unhappy about the LA, have you considered changing?

Brallaqueen

I'm on Pippa's side. The only one out of the pair with a steady income is about to go on maternity leave, will no guarantee of returning to work. Self employed partner is employed in a troubled sector affected by the recession (builder or electrician, still applicable). PIppa, what's your stance on 6 months rent in advance, or a guarantor?

EDIT crossposted with Better Days!

If it helps, Pippa, I wouldn't consider a guarantor anyway (beggar to arrange properly and no guarantee of getting the money) and courts can be very concerned about evicting families unless mandatory and even then they have some leeway over extensions and dates.

ruggedtoast

What an absurd amount of assumption.

The woman may well have an excellent maternity package and they may both have plenty of savings.

I know plenty of plumbers, builders and electricians all of whom are self employed and all of whom have paid what they owed every day of the week.

Perhaps the OP could tell us what the monthly rental on this exclusive palace actually is?

PIppa

Hi

The rent in advance sounds like a good idea.

The man hasn't even viewed the property and apparently works away a lot of the time.

The woman hasn't actually passed the income check yet. The agents have written to her employer for confirmation so I only have the agents' words for that.

At this point in time I don't have any further information on the man as the agents aren't intending to check his income.

I moved agents 6 months ago as the first agents were awful too. Just for information, it took the first agents 7 months to do an inventory on the shed, they didn't supply the tenant with the phone number so he could get the phone connected, they didn't do regular checks and when the rent started to arrive late (out of character so rang alarm bells) they didn't chase etc. The garden became so overgrown that the lawn went to seed. Just a few of their shortcomings.

The second agents actually signed a tenancy agreement with the present tenants before notifying me. It was after I agreed and received a copy that I saw the date. The current tenants are leaving because they were doing a house up and it's now finished.

The agents originally told me the prospective tenants were renting. When I asked who the current landlord is, they then said they are both living at home. It's getting to the point where I'm not sure I can trust what I'm being told at all.

Obviously living abroad, it's not as easy to communicate with agents face to face. I think it's time for me to take a look at other agents!

Better_Days

PIppa wrote: »

Hi

The rent in advance sounds like a good idea.

The man hasn't even viewed the property and apparently works away a lot of the time.

The woman hasn't actually passed the income check yet. The agents have written to her employer for confirmation so I only have the agents' words for that.

At this point in time I don't have any further information on the man as the agents aren't intending to check his income.

I moved agents 6 months ago as the first agents were awful too. Just for information, it took the first agents 7 months to do an inventory on the shed, they didn't supply the tenant with the phone number so he could get the phone connected, they didn't do regular checks and when the rent started to arrive late (out of character so rang alarm bells) they didn't chase etc. The garden became so overgrown that the lawn went to seed. Just a few of their shortcomings.

The second agents actually signed a tenancy agreement with the present tenants before notifying me. It was after I agreed and received a copy that I saw the date. The current tenants are leaving because they were doing a house up and it's now finished.

The agents originally told me the prospective tenants were renting. When I asked who the current landlord is, they then said they are both living at home. It's getting to the point where I'm not sure I can trust what I'm being told at all.

Obviously living abroad, it's not as easy to communicate with agents face to face. I think it's time for me to take a look at other agents!

Good grief!

I don't think you can trust this LA. They have:
1) Failed to turn up to show round a prospective tenant
2) Agreed to the first tenancy without your approval
3) Told porkies about the prospective tenants current rental status

I do wonder if the LA are just lazy, incompetent or they have some connection with the potential tenants and are trying to pull a fast one.

Now these potential tenants maybe fine, but even if the woman's income check comes back OK, you will still not have enough info to make an informed decision. In your shoes, if I decided to proceed I would insist that the LA also undertake the appropriate checks for the man, and if still unsure rent up front. As the LA appear to be untrustworthy I would also ask for a copy of any credit info etc that the LA obtain, and on which the LA has based their recommendation.

Finding a new LA may well a better route, but only you know how much hassle it would be in your current circs. Is there any way you could get a personal recommendation from someone who knows the local area regarding a more trustworthy LA?