As a landlord, you can do background checks on any new tenants before they move in. This includes checking they're able to pay the rent.
A letting agent can help you with these background checks, if you choose to use one.
Proof of identity
You could ask to see a tenant's photo ID. For example, a passport or driving licence.
If a tenant doesn't have a photo ID, you can ask for a utility bill from the tenant's current home instead.
Landlords who rent properties to tenants in England and Wales must check that a tenant has a right to rent, and live, in the UK. You don't need to do this check in Scotland.
You could ask tenants for proof they can afford the rent.
You can ask to see:
- a tenant's recent payslips or bank statements
- a letter from the tenant's employer confirming they work for them (and how long for)
- accounts or bank statements if the tenant is self-employed
- award letters if the tenant is claiming benefits
You might want to do a credit check on a new tenant, to see if they've had problems paying bills in the past.
You'll need written permission from the tenant to do this. You should also explain what information you will check and who will be checking it.
There are many companies which provide credit checks for you. They'll charge you a fee for this service.
You may want to contact a tenant's previous landlords to check they are reliable and trustworthy. To do this, ask for:
- contact details of a tenant's previous landlords from the past 3 years
- the addresses and dates of everywhere a tenant has lived in this time
If the tenant can't give you a reference, you can ask them to provide:
- a previous tenancy agreement
- bank statements to show the tenant paid the rent on time
If the tenant hasn't rented before, they can give contact details of a guarantor. This could be a parent, guardian or someone else.
You must comply with the Data Protection Act 1998 and the General Data Protection Regulation and Data Act 2018 to make sure your tenant's personal data is held where it's secure and only disclosed in a legal manner.
A guarantor is a person who agrees to pay the rent or cover damage to the property if the tenant doesn't pay it. The guarantor should agree in writing that they are willing to take on this role.
Not all tenants need a guarantor. You might choose to ask for one if:
- the tenant doesn't have a job
- the tenant has a poor credit record
- you've asked for a reference but the tenant can't give you one
You can also ask the guarantor to agree to a credit check, or any other checks you have carried out on the tenant.
In Scotland, landlords and letting agents can only ask tenants to pay for:
- a refundable deposit (which can't be more than 2 months' rent)
Any other charges to tenants are called 'illegal premiums' and are against the law. They include charges like:
- administration fees
- credit checks
- holding fees (including refundable and non refundable fees)
If a tenant thinks they've been charged an illegal premium, they be able to claim this back and their landlord may be guilty of an offence.