Tenant referencing provides all the background information on prospective tenants, helping landlords and letting agents make an educated choice about who they let their properties to, and - more importantly - their ability to pay the rent on time each month.
There are different levels of referencing available to letting agents and their landlord clients, from a very basic package to a more a comprehensive service. The level a landlord opts for will generally depend on the extent to which they want to minimise their exposure to risk.
Of course, it is in everyone’s interest, agent, landlord and tenant, to ensure that the tenant is bone-a-fide and in a strong financial position in order to meet the on-going rent. But unfortunately, there are occasions when tenants cannot or will not pay their rent, adversely impacting on the landlord’s rental investment in the process, as tonight’s episode of “Bad Tenants, Rogue Landlords” will show.
The TV show, which will be aired on Channel 5 at 8pm, will highlight the dangers of fake tenant references, as one landlord faces a struggle to get his property back from a bogus company let.
Paul Bloom, a professional landlord with several properties in London, let one of his flats in a quiet part of Hampstead, NW3.
The letting agent he used was approached by a third party wishing to rent the property as a company let. After passing referencing, it was understood that an employee of the travel company MSalliance Ltd would occupy the property.
When neighbours started to complain about noise and anti-social behaviour, it quickly came to light that this was not a legitimate company let and Bloom was going to face a tough battle with his tenant, who had stopped rent payments, to regain possession of his property.
The landlord, Paul Bloom, said: “I work in music and come across a lot of colourful characters, but it doesn’t come close to how people seem to be able to work the system in the property industry.
“Professional rogues are so aware of how to get around every measure put in place to protect landlords.
“I’ve learnt a valuable lesson and will certainly be doing all I can to cross-reference my tenants in future, and where possible meet tenants before they move in.”
Paul Shamplina, founder of Landlord Action, says that cases where traditional referencing has fallen short of the innovation required to spot rogue tenants is becoming increasingly common.
He commented: “Company lets are not unusual in London and many landlords like the idea of a professional organisation taking on the tenancy agreement because, in theory, it offers greater security and guaranteed rent.
“In reality, the same risks as renting to an individual tenant apply. Unless the company wishing to take on the tenancy is a recognised name, those responsible for arranging the referencing should request company registration details, ensure the company is still trading and request details of the employees who will be occupying the property.
“My advice is to take the time to call the employer and if something doesn’t feel right, dig deeper and always trust your gut instinct. You’ll see in this particularly eventful episode, just what can happen when things go wrong.”