Tenant failed referencing & credit check - What to do!

dominoman

Kynthia wrote: »

Are you buying any rental guarantee insurance that requires the tenant to have passed the credit check? If not then it's your decision, but have you looked at other potential tenants?

Yes I wanted to get rental guarantee insurance but without this reference check being passed I unfortunately can't get that.

For me doing the reference was always intended to be a contributing factor to my decision, rather than the only factor. I am concerned about taking the risk with him, but I am thinking I could mitigate by asking for 8 weeks deposit (rather than 6).

If I advertise again it is a load of hassle, plus will mean it is empty another 2-3 weeks.

AdrianC

dominoman wrote: »

For me doing the reference was always intended to be a contributing factor to my decision, rather than the only factor.

With a positive reference, definitely.
With a negative reference... Hmm...

I am concerned about taking the risk with him, but I am thinking I could mitigate by asking for 8 weeks deposit (rather than 6).

If I advertise again it is a load of hassle, plus will mean it is empty another 2-3 weeks.

So you'll have two weeks rent plus two extra weeks deposit plus the cost of the insurance policy you can't buy - to balance against the risk of him taking the Michael and leaving you short of rent and facing legal battles to evict him. You've already caught him in a somewhat transparent lie in which he admits to lying about his income.

Good luck.

Emmylou_2

xylophone wrote: »

Does he have a reference from his current landlord?

More importantly, and more likely to be accurate (ie he doesn't have a vested interest in getting rid of the guy from his property) do you have a reference from his PREVIOUS landlord...

dominoman

xylophone wrote: »

Does he have a reference from his current landlord?

Yes - Current landlord reference was excellent. I also saw his flat where he currently lives (I made an excuse to come around and explain about the flat - and only gave a few minutes notice so I would see where he lives in its normal state, and it was immaculate). I spoke to the porter too and he says he is a great guy and confirmed he has lived in the block 2 years.

Errata

This all sounds very fishy - a family live in a portered block of flats and the porter is happy to gossip about them to anyone who rocks up?

bxboards

I had a very similar situation recently, great guy, but he failed the referencing on affordability - the referencer wants to see 2.5x wage earnings over rental costs.

My tenant also did a bit of cash on the side and ironically, if that was added to his declared 'on the books' wages he would have passed referencing.

In the end, I said no - my concern is that even if there is extra undeclared income, your rent will be paid by standing order, and how is that 'off the books' stuff going to get into the bank account that pays the rent? It's more likely to stay in his pocket of the radar.

My agent also wanted me to sign a disclaiming saying I was renting with the full knowledge that the tenant had failed if I decided to go ahead. You also will scupper any rent guarantee chances.

Personally speaking I think you need to ignore your heart and go with your head on this.

AdrianC

dominoman wrote: »

Yes - Current landlord reference was excellent. I also saw his flat where he currently lives (I made an excuse to come around and explain about the flat - and only gave a few minutes notice so I would see where he lives in its normal state, and it was immaculate). I spoke to the porter too and he says he is a great guy and confirmed he has lived in the block 2 years.

You've already made your mind up, haven't you? You're just after some support in justifying your decision, maybe to your missus? "Look - they told me on MSE it'd be fine..."

Good luck. I hope you don't need it.

Billie-S

You don't have to take this guy. There surely must be other tenants.

On the other hand, if it says on paper that he cannot afford the rent, then can he not claim some housing benefit? How is he affording his rent now?

Also, what if you take someone on now as a tenant, who can afford the rent, and then they lose income, they would have housing benefit wouldn't they?

Have you told him he failed the credit check, and why?

dominoman

AdrianC wrote: »

You've already made your mind up, haven't you? You're just after some support in justifying your decision, maybe to your missus? "Look - they told me on MSE it'd be fine..."

Good luck. I hope you don't need it.

No - not at all. I am undecided. I am waiting to see how his wife's credit check comes back. If there is any discrepancy on hers then that will make my mind up and I will re-advertise. If hers is glowing then I'll probably go with it.

He failed the affordability check - but as he works in a trade that is heavy in cash I can understand why. If I had seen any other red flags I'd have said no immediately.

dominoman

Billie-S wrote: »

You don't have to take this guy. There surely must be other tenants.

On the other hand, if it says on paper that he cannot afford the rent, then can he not claim some housing benefit? How is he affording his rent now?

I'm pretty sure he earns more than his bank statements show - and does some of his jobs for cash. Most tradesmen probably do. I don't agree with that of course, but all I care about is getting my rent so I can pay the mortgage.