Tip 3: References & Credit Checks

You’re probably already aware that you can get references from a number of places when considering a new tenant:

  • Their employer
  • Their accountant if they’re self-employed
  • Current landlord
  • Previous landlord
  • Their bank

There are also lots of credit check services you can find online. Google ‘Tenant Credit Check Services’ and give one or two a call and chose one that seems helpful.

Right, this is where we get to the main point of this weeks’ tip. It applies mostly to those of you considering renting by the room rather than single occupancy but it’s good advice either way:

DO NOT, UNDER ANY CIRCUMSTANCES, RELY SOLELY ON REFERENCES!
GREAT REFERENCES DO NOT GUARANTEE A TROUBLE-FREE TENANT!!

I have seen many, many landlords who insist on every type of reference they can think of who regularly end up with truly awful tenants. Why? Well first of all references can be fabricated. Certainly references from a friend or colleague are pretty useless because there’s no way to know if the description of the person is accurate or if it’s just a friend being kind.

References from a current landlord can’t be relied on either because despite the fact that giving a false reference is illegal some landlords with a tenant they just hope and pray would leave because they’ve been so horrendous is surely tempted to give a positive reference when the alternative would mean the tenant could not move on and would therefore stay longer!

I have a much, much better way of checking a tenant is the sort of person I want in my houses (and who will get on with those already there if multi-letting) that is so reliable that for a number of years I didn’t even bother with standard references at all! And despite having at the time 50-60 tenants at any one time, I didn’t have one bad tenant.

Now, I’m not suggesting you do the same and forget all about asking for references but I am saying you should ask for references IN ADDITION to what I am about to suggest.

So, what do I do to ensure I don’t waste my time on idiots and always find the genuine, respectful and friendly tenants who cause me minimal issues and stay year after year?

I do what I call a ‘Personality Check’ which is made up of two parts:

1) Telephone Interview
2) Face To Face Meeting

The two tips covered in the next two weeks go into the Personality Check in great detail because it’s so important and you need to get it right.

Tip 4 looks at the Telephone Interview and discusses:

  • Why you should insist on one
  • What to ask and why
  • How to use how they speak rather than what they say to your advantage
  • How to end the conversation if you don’t like them afterwards
  • How to end the conversation if you would like them to arrange a viewing

Tip 5 looks at the Face to Face Meeting and discusses:

  • What to ask
  • What to look out for
  • How to best mix tenants of differing ages, sex and temperament
  • How to spot the type of people you really must avoid
  • How to identify exactly the type of tenant you want

Getting the right people is absolutely key to a happy and fruitful life as a landlord especially if you intend to multi-let. I know many multi-let landlords who are not so picky with their tenant choices and they wonder why they have so many empty rooms. Get the wrong tenants into a multi-let and you’ll drive away everyone else. You could then be stuck with a bad tenant for a very long time.

So the message for this week is simple. Be picky! And DO NOT expect references to show you who to avoid and who to trust. You really are asking for trouble if you do. The Personality Check is really easy once you know what you’re doing and over the next two weeks I’ll give you all you need to become an expert at identifying whether someone is perfect for your property or a potential nightmare.

See you next week!

Steve

P.S. If you’d like to order my CD ‘How To Find, Attract and Retain The Best Tenants‘ containing the entire system I’ve developed to make sure you only ever get the best tenants, they stay a long time and recommend you to other potential tenants, you can do so here: http://www.tenantscreeningtips.com/cd. For a limited time it’s only £27.97 with FREE delivery!

The CD includes all 14 top tips which together make the perfect system for finding, attracting and retaining only the best tenants for your properties, including:

Professional versus Student Tenants – Both have their advantages. I’ll help you decide which way to go

Online Advertising – Where to advertise to make sure you don’t get left with empty properties for long

Pricing – How to get your pricing right so you get the tenants you want. Also what you should include in the rent and what you should charge for

The Advert – What to say in your advertising so you get loads of enquiries from the types of tenant you want

References and Credit Checks – Not as simple as it seems! Rely solely on great references and you’re asking for trouble!

Telephone Interviewing – Save yourself hours of time with this simple tip

Face To Face Meetings – Why these are so important and what to look for when you first meet a potential tenant

Saying ‘NO’ After a Viewing – How to say ‘No’ to someone you don’t like after a viewing

Dealing With ‘No Shows’ – What you should do if someone fails to turn up to a viewing

Rent and Deposit Negotiations – How to confidently deal with potential tenants who want to negotiate the price

Securing ‘Gem’ Tenants – How to attract and keep tenants that suit your property perfectly

Recommendations – How to encourage tenants to recommend you

Recommend Other Landlords – Why this is a very good idea!

Waiting Lists – Why you should keep them

Think those tips could help? Can you afford not to make the most of my experience for the sake of £27.97? Order here: http://www.tenantscreeningtips.com/cd