Tenant referencing is likely to be an essential part of any fully managed or tenant finding service you offer. Not carrying out effective checks could result in unpaid rent, property damage, antisocial behaviour, and even illegal activities in the worst-case scenario; here’s what to consider.
What should tenant referencing include?
Tenant referencing must be robust to give your landlords the greatest chance of finding great tenants. While it does not guarantee that things can’t go wrong, it does go a long way to reducing the risk.
To find the most suitable tenants for properties, you should carry out and consider:
- Right to rent checks (applicable in England only)
- Affordability checks
- Credit checks
- Employment status and reference
- Previous landlord references
- Guarantor checks (if needed)
- Company credit check (for commercial clients)
- Anti-money laundering checks
Recommended tenant referencing providers
Your agency can carry out its own checks, but you can also outsource the task to providers. Checks using a third-party often take just a few days and, in some cases, as little as 24 hours.
Usually, the third-party provider invites tenants to start the process and asks for all the relevant information upfront. Automating the procedure keeps the process moving and makes it as efficient as possible.
The following tenant referencing providers are available:
RentProfile
An award-winning provider which has carried out more than 100,000 tenant checks since its launch in 2016. Average turnaround for checks is 24 hours. Services offered include:
- Tenant referencing covering right to rent, identity, employment, affordability and credit checks
- Tenant onboarding
- Anti money laundering checks
- Advanced risk scoring for greater tenant screening accuracy
- Real-time tracking
- FCA and GOV.UK recognised
Canopy
Another award-winning provider which aims to be completely paperless. Canopy offers a streamlined service that also aims to help tenants log rent payments to build credit scores. Services offered include:
- Free lead pre-qualification
- Right to rent
- Experian credit report
- Income and affordability verification
- Identity and anti money laundering checks
- Employment and previous landlord references
Tenancy 360
Offers a bespoke user dashboard that takes tenants from onboarding to agreement completion. Their platform also lets you manage safety and compliance certificates to keep records up to date. Services offered include:
- Credit and affordability checks
- Landlord and employer referencing
- Tenancy agreements and e-signature collection
- Tenancy compliance support
- Fast and secure deposit and standing order management
- White labelled, automated emails and texts to tenants
Vorensys
As well as tenant referencing, Vorensys also offers a white label service, allowing you to integrate the software into your own system. Free trials are available to business users, so you can try the platform before committing. Services offered include:
- Tenant referencing, including right to rent
- Credit checks
- Income verification
- Anti money laundering checks (additional financial sanctions check optional)
- Contract generation
- Document storage
Letmojo
Splits tenant checks into tier one, which is automated and covers an identity and credit check. Tier one also includes a review of any addresses tenants may not have disclosed, which could flag up any credit issues.
Tier two checks are done manually, and look at landlord references and tenants’ financial circumstances (such as tax returns for the self-employed and income sources). Services offered:
- Tenant referencing and right to rent
- Identity checks
- In depth financial review
LetRef
LetRef emphasises the need for robust referencing and ensures all checks can be fully supported and verified with evidence. Checks take an average of 48 hours. You can log into their online platform to see at what stage the process is at. Services offered include:
- Identity check and right to rent
- Credit check
- Previous landlord references
- Employer check
- Guarantor check if necessary
Helping you support landlords
Bear in mind that rent guarantee insurance requires tenants to be referenced and pass affordability checks as a policy condition. If checks haven’t taken place, policies can be voided, and insurers can reject claims, leaving landlords facing hefty bills.
If you’d like more advice about how we can help you to support your clients, contact a member of our team on 01603 649727.
Tenant referencing services are not something that is regulated by the Financial Conduct Authority.
