Importance of tenant referencing

tenantriskverification October 17, 2012 0

by Aparna Shankarraman


Are you a house owner and planning to rent out your home to others? Then read this article to know more about tenant referencing. This practice exists in the UK but can be implemented across all countries. This article provides a detailed guideline to ensure accurate tenant referencing and rent out the house to the right person.

What is tenant referencing?

A property is one of the most expensive long-term assets of a person. A landlord would never want anyone moving in and taking him for a ride. The tenant referencing activity is the best solution for protection of a landlord against corrupt tenants. A tenant referencing activity establishes the actual identity of a person, his previous record of honoring commitments and capacity to pay timely rent. This practice of tenant referencing is prevalent in the United Kingdom ( England and Wales).

tenant verification

How to undertake a tenant referencing activity?

The activity of tenant referencing can be undertaken with an application form designed columns for all mandatory details. The tenant application form should include a condition that the landlord shall have all rights to carry a credit check, employer reference check and inquiries from previous landlords.

A crucial tip for a landlord is to carry on all tenant referencing checks before the tenant moves into the house. Once a tenant occupies a property, then the space becomes his home. The legal provisions also safeguard a tenant’s right to stay in the rented accommodation. Hence, one should never hand over the keys of a house before carrying on complete background and orientation checks.

A comprehensive list of scrutiny for tenant referencing includes four aspects.

Credit scrutiny of the prospective tenant

Credit scrutiny is conducted by looking at the bank statements of three months. A landlord can even obtain a credit score of the tenant at highly affordable rates. The score can be a guide to assess the risk of letting out the property to the person. Negative instances like court judgements, credit card defaulter or loan defaulter, will also be available in the credit report of the tenant.

Affordability scrutiny of the prospective tenant

Affordability scrutiny is done by proofs of monthly income or salary certificate. It helps a landlord judge the competence of the person to be able to pay rent every month. The credit report of the tenant can also play a vital role in this scrutiny. The landlord can have a fair idea of the tenant’s financial commitments and his net income.

Employer reference

Employer reference in a written format is indispensable. The employer declares that the tenant works in the corporate at a certain designation. He also certifies the salary certificate and confirms that the salary stated by the tenant matches the company records. However, the landlord can be extra cautious by visiting the employer’s premises to check the reliability of assertions. The landlord can also refer the company website to call the employer and cross check details.

Previous landlord reference

The prior landlord reference includes a statement from all previous landlords received by the tenant. This helps a landlord to check if the reasons provided by the tenant for vacating the previous property are correct. The landlord should take up an additional check by talking to all previous landlords personally. This can not only help him obtain character details about the tenant but also ability of the tenant to maintain the property in a perfect and healthy condition.

A salient guideline for a landlord is to obtain the name of a guarantor of the tenant. If the tenant struggles to pay rent at any future date, then the guarantor can be sued to receive the rental dues. Moreover, the landlord should also obtain certified copies of the tenant’s passport, driver’s license and documents displaying tenant identity to ensure traceability of the tenant if he vanishes from the property any day.


Due diligence conduct by a landlord can ensure that the tenant does not approach the house with an inclination to behave badly or cheat. All landlords in every part of the world should undertake this vital step of tenant referencing to ensure a tension free and healthy relationship between the house owner and the tenant.

This article was written by Aparna Shankarraman  and originally published on indiastudychannel

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