What to expect beyond a tenancy agreement
When it comes to letting a property, there’s plenty in the way of paperwork that needs to be signed before a tenant can take possession.
Here, we take a look at some of the most common paperwork that needs to be exchanged, explaining what it is and why it’s needed…
Once a tenant has viewed a property and has decided they want to rent it, they’ll fill out an application form. This will contain information essential to background screening, such as referees, and proof of employment and/or income. Credit scores will usually be run at this stage too, or some landlords may wait until reaching the tenancy agreement stage.
A holding deposit – different from the security deposit – is a sum normally amounting to one week’s rent. This is a deposit to essentially “hold” the property until further notice, meaning it is taken off the market, while background checks are carried out. If for any reason the tenant doesn’t sign the lease, the costs of running these background checks may be kept from the holding deposit with only the remaining balance refunded.
Identification and Right to Rent
Once a tenant reference check is underway, a landlord will need to be supplied with information such as birth certificate, passport, a recent bank statement, and utility bill with a current address (the statement and utility bill must be dated within the past three months). As of 2016, UK landlords must also check that a prospective tenant has a right to reside in the UK, and so in the absence of a passport they must be provided with a copy of a visa or other documentation that proves right of residency.
Once a landlord reference has been completed, a tenancy agreement will be drafted for both parties to sign. This will include things such as the security deposit required, the monthly rent payable and on what date, notice required to terminate the tenancy, gas safety check information, and division of responsibilities (such as who pays for electricity, water, internet and council tax). Tenants or landlords may request revisions or additions, and once the terms of the document are agreed upon, the tenancy agreement (also called a lease) needs to be dated and signed with both parties receiving a copy.
Once the tenancy agreement is signed and collected, further paperwork is normally required in the way of setting up a standing order, a property inventory, and more. Keeping on top of all the necessary paperwork can be hard enough with just the one property, let alone if you’re a landlord with several. To make sure nothing gets missed and that all the paperwork for each tenancy is up to date and in order, you may consider instructing a letting agent to take care of all of this for you.