Tuesday, September 27, 2011

Diary of a landlord: tenant checks

I've settled on a tenant and need to run credit checks and references ? and find somewhere for myself to live

Part one Diary of a landlord: open day viewings

It only took a few days to find someone to rent my flat. Now my agent has received the tenant's holding deposit, the next step is to check references.

The agent tells me the tenant has paid for the credit check and administration fees for the tenancy agreement to be drawn up. I need to pick a move-in day in the coming two weeks so the agent can notify the tenant. I just have to get my skates on and find a nice two-bed place to rent myself now.

I can't believe how quick the whole process is, and can't help but wonder if I could have got more rent for my apartment. If I found a couple that didn't find it too small, would I have earned an extra �100 a month? Maybe being a greedy landlord isn't something I would be proud of, although the extra income would have been nice.

A few days pass and the agent calls to say the tenant's references all check out, and the credit check report is a pass "but not with flying colours". The tenant apparently has a lower-than-average credit score: a few repayments have been missed on a credit card and an old car loan from five years ago.

"Do we readvertise it then?" I ask the agent. "No way, he'll be fine," the agent says. He explains this is very common at the moment and the tenant's earnings more than cover the rent. "We'll take six weeks holding deposit," he adds.

I was then given a leaflet on rent guarantee insurance, but decide, without consulting my parents for a second opinion, to decline the agent's offer to take it out. Instead, I set myself a goal to put aside a set amount of money from my rent to establish a "rainy day rental fund".

This means if the worst comes to the worst and the tenant leaves, or if I have to fund a major repair, this will cover it.

The agent then gives me a copy of my tenancy agreement, an inventory form to fill out and the tenant's contact details.

As I am going to manage the rental myself ? to save paying the extra monthly commission to the agent ? I will have to sort out any maintenance on the apartment and take calls from the tenant about any problems.

But it's only a one-bed place in a purpose built building, so I'm sure I won't be called upon too often.

I ring the tenant to ask if I can give him a move-in date at the weekend: I am due to see a few rental properties myself, so will then have a better idea of when I can move out. I am greeted with an unenthusiastic "OK then ? but I was hoping to move in next week."

The tenant then asks if he could revisit the apartment, and within what feels like a few minutes he and his partner are both having a good snoop around, looking in my kitchen units and storage cupboards.

I feel like this is a good time to work out which items of furniture they would like me to leave behind. I'm keen to off-load the majority of my living room furniture, as I want to start afresh in my new place with new items, away from the bachelor pad-style I currently live in.

However, the tenant only wants my dining table and chairs and my faux leather sofa. So I still have the task of moving an old sofa, bed, coffee table and matching side units down eight flights of stairs. I guess that's what removal firms are for.

It feels a little strange ? the thought of this person I have only just met living in my property. But I guess I have to set aside my attachment to the home I have enjoyed for many years, and think of it as an investment or pension for years to come.

After all, it's only bricks and mortar, and if I can remortgage it in the future maybe I could buy another one and rent that out too.


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Source: http://www.guardian.co.uk/money/blog/2011/sep/26/diary-of-landlord-tenant-checks

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