1st time Landlord advice please!!

Cheddar_2

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!! :money:

Claire :A

mlz1413

Point 1 - As both are to be named tenants then you need to read the credit report you get back and see if everything is as they say. If you have any doubts then maybe they could pay for the full 6 months rent upfront.

Point 3 - WH Smith sells a full legal pack for about £15 (may have gone up) which gives you AST for England and Wales and AST for Scotland, notes on how they work and futher forms for ending AST's. IMO its worth buying this and reading it through, you should have a good understanding of what is expected from you and what you are liable for.

Point 5 - Go onto the www.direct.gov.uk website, type in deposit protection and read all the information that goes with it again you should have a good understanding of what is required and what is on offer.

Good Luck

JWF

Some more general advice on the issue of renting. Make sure you have a thorough catalogue of everything that is left in the property, ideally taking photos of each room so you can clearly document the condition at the point the tenancy begins. This can save you a lot of bother in the long run.

moneysavinmonkey

Cheddar wrote: »

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!! :money:

Claire :A

There seems to be quite a few things missing from your list....
As you mention as well as tenancy agreement, you need to sort out an inventory, & arrangements for protecting the tenants deposit under a regulated Tenancy deposit scheme. Your best off getting information on these from one of the landlords association websites: try landlordszone or nationallandlordsassociation.

You will definitely need landlords insurance as your regular residential buildings insurance won't cover you if your tenants accidentally burn the house down.

Who will be responsible for utilities + council tax bills....if you are handing these over to the tenants you will need to take readings + pass on details to the relevant authorities.

Have you looked into possible scenarios that can occur, and are you familiar with what you will need to do.... for example:
- how to end the tenancy either a) at the end of a fixed term or b) during a rolling period tenancy
- what to do if the tenant does not leave at the end of the notice period
- what you need to do if you want to visit the property either to inspect the condition or carry out repairs
- what to do if the tenant has not paid rent on time, or is in arrears
I suspect these are the most common occurances, and fairly standards so you should know the answer... you could check out these forums for some more unusual circumstances!

The other thing to mention is tax, you will need to fill in a tax return form and declare any income (minus expenses including mortgage interest) you receive from letting your property.

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The unemployed status should not affect the first applicants credit score, AFAIK the credit scoring agencies don't keep details of salary.... as long as she has being paying all bills on time. You could ask for proof of income, instead of an employment reference to cover yourself I guess.

Only you can know which tenancy agreement best suits you, read through it and make sure you understand all the clauses. Be wary of the source you are getting it from and also of adding in additional clauses that you make up as these could fall foul of the unfair terms advice given by the OFT.

---

Ultimately you are handing over a £100k+apartment to a pair of strangers. As long as you take a serious + professional attitude towards this + do all the necessary preparation + research you should be fine.

Cheddar_2

Thanks for all your help and advice so far - really appreciate it, and we'll investigate all the information given above

Re. the credit checks, 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?

clutton_2

use an agent - for goodness sakes uses an agent - you dont know what you are doing - you are going into a highly complex business with advice from a general housing forum !!!!! for goodness sakes put your sensible head on !!!!!

do not buy an AST from Smiths - there is a thread on here showing it has important errors in it

any tenant who will not be credit checked is hiding something

join national landlords association - read their website, buy some books on landlording and tenanting, read www.singingpig.co.uk and www.landlordzone.co.uk forums FROM FRONT TO BACK to see exactly what can go wrong if you get it wrong on day one (Singingpig has a huge book list)

forgive my bluntness - but we see posts on here all the time from tenants whose LLs are amateurs and who screw things up all the time

use an agent for 6 months - learn from them - use this time to read and research and learn the business before committing your own lack of experience to the wiles of "professional" tenants who will rip you off royally and cost you thousands of pounds


I've been a LL for 8 years and am still stunned by the stunts professional tenants pull when i read these forums ........

good luck

Spire128

Hi

You need to get any gas appliances checked by a corgi registered person as you have to have a certificate to say its safe and been checked, a copy of which has to be given to the tennant.

paintpot

I have to agree with clutton.

The first thing that springs to mind (and it could be perfectly valid) is why is the tenant moving from one apartment to another? Does yours offer something that they currently don't have or are they being served notice by their current landlord? If so why?

Anyone not wanting to be credit checked would sound alarm bells in my head. Any adult in the property should be on the tenancy and then they can be made jointly and severally liable for the rent. The more people you can go after if they default the better so looking into adding a guarantor is also an option. It doesn't matter if they have been credit checked before - that was done for another landlord and not you. The fact that you know the agent she is renting through is irrelevant, you need to start your checks from scratch to satisfy yourself that they are both suitable tenants.

One mistake and it is going to cost you alot of money, time and hassle.

Cheddar_2

clutton wrote: »

use an agent - for goodness sakes uses an agent - you dont know what you are doing - you are going into a highly complex business with advice from a general housing forum !!!!! for goodness sakes put your sensible head on !!!!!

Clutton - firstly, many thanks for your advice. As an experienced landlord, I really value your opinion. I am actually sourcing information from a number of forums, websites and people I know who already let their houses / apartments, but I find that forums often give the best and widest opinions (as is evident from the above feedback!) :beer:

Nevertheless, I think we have decided to do this alone. Our tenant has now agreed to credit checks for both her and her boyfriend, so that's great. We have followed the advice from a number of people, and have decided to have the checks done via TenantVERIFY.

We have templates of the inventory, etc, so we're good to go with that... it was just the Tenany Agreement that we are being very picky over - we need to make sure it's exactly right. Clutton - you mentioned the SingingPig website - they have an agreement on there. Have you seen it, and if so, is it appropriate?

Spire128 wrote:

You need to get any gas appliances checked by a corgi registered person as you have to have a certificate to say its safe and been checked, a copy of which has to be given to the tennant.

We have no gas, but are getting an electrician out to fix a few problems with the lighting. On that visit, we will ask him to check over everything else. It is a new build apartment anyway (well, I say new... but it's nearly 4 years old)

Paintpot wrote:

The first thing that springs to mind (and it could be perfectly valid) is why is the tenant moving from one apartment to another? Does yours offer something that they currently don't have or are they being served notice by their current landlord? If so why?

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

clutton_2

i would join national landlord association and use their documents - cost of joining is tax-deductible and they have a great legal help line for any problems you encounter.

you will need your Lenders permission to let
you will need a landlords insurance policy (discounts available for NLA membership)

deposit scheme ??
PAT testing ???

""Our tenant has now agreed to credit checks for both her and her boyfriend, so that's great." - not until you get the results back it aint !!!!

Cheddar_2

Cheers for your advice Clutton - will get onto that ASAP

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?