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Top Tips for Landlords to Minimise Rent Arrears
In the current economic climate and with more ‘accidental landlords’ than ever letting property, it’s never been more important to do all you can to avoid rent arrears.
Take these straightforward steps to reduce the risk of prospective tenants slipping into rent arrears.
Bank on It
Ask potential tenants for at least three months’ worth of bank statements so you can see their salary going into their account and have evidence that they’ve been paying their rent regularly. Bank statements will also give you an idea of how affordable they will find the rent that they will be paying you.
Work it Out
Obtain an employers reference in writing and don’t take it as read that the reference is current. Google the company for the phone number (don’t rely on being given it by the tenant) and call your prospective tenant’s employer to confirm that the company exists and, equally importantly, that they are still an employee.
Get a Reputation
Speak to your prospective tenant’s previous landlord/s to establish whether they were a reliable tenant; an invaluable way of flagging issues that could be hiding around the corner.
Vote of Confidence
Check the electoral roll to confirm that the tenant has given you an accurate previous address. This can show that they’ve not been trying to avoid being liable for council tax and also helps to confirm whether a reference from a previous landlord is current and genuine (in the event that you’re unable to speak to them directly).
Passport to a Trouble-Free Tenancy
Ask the prospective tenant for a copy of their passport and visa, if required. This not only helps confirm their identity, but also whether they can legally remain in the country for the entire period of the tenancy.
Guarantee any Doubts
If you are uncertain that the tenants will be in a position to pay their rent every month for the term of the tenancy, secure a UK-based guarantor who will then be liable to pay the rent, should the tenant default.
Ask an Expert
If all this sounds like an awful lot of work, use a reputable letting agent to arrange your tenancy and ensure that they take these steps on your behalf to carry out a rigorous suitability assessment before your tenant moves in.
Insure your Peace of Mind
As a last resort, and for added peace of mind, consider taking out an insurance policy to cover the rent in the event that the tenant doesn’t pay – but bear in mind that this can be an expensive option.
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