How renters can avoid major renting pitfalls

There are various ways that landlords can run checks on prospective tenants, but very little that tenants can do in return. However, there are a number of measures that tenants can take to ensure peace of mind when renting a property.

Fraudsters

The rising demand for rental accommodation across the United Kingdom has seen a number of fraudulent landlords attempt to cash in on needy tenants.

Cases of fraudsters advertising properties that have already been rented out, renting to multiple unknowing occupants at the same time or even advertising properties that don’t exist are becoming increasingly common.

Problems are also occurring with mortgage permissions of rental properties. In some cases, properties are being rented out by the real landlord, but without permission of their mortgage company. By doing this, landlords are in breach of their mortgage terms which could, in extreme cases, lead to repossession.

Some landlords are also said to be very close to entering financial deficits, which could again lead to repossession, with tenants non the wiser of imminent threats to their home.

Resources

Director of online flat and room share company SpareRoom.co.uk, Matt Hutchinson says that there are things that tenants can do to ensure a smooth tenancy agreement. He acknowledges the lack of resources in comparison to landlords conducting checks on them, but says that, “there is nothing to stop tenants doing a little research of their own.”[1]

Hutchinson suggests that tenants should, “start off by asking questions,” and that, “a good landlord will be happy to answer anything-within reason.” He goes on to say, “being thorough doesn’t have to mean being confrontational,” and that tenants should, “ask how long the previous tenants were in the property, why they left and whether it’s possible to speak to them.”[1]

Away from asking questions, tenants can use other options to make sure things are genuine. Tenants can ensure that prospective landlords do own the property they are interested in renting by using the Land Registry. For as little as £3, tenants can buy tile registers through the Land Registry which will show full ownership details. Data obtained from the Land Registry can additionally give details of charges on the property, such as loans, which are inclusive of mortgages. This data can help the tenant understand what payments must be upheld to avoid repossession.

Proof

Mortgage lenders’ terms and conditions state that a landlord needs one of a buy-to-let mortgage or consent to let from their mortgage provider in order to rent out a property that has a residential mortgage. Glenn Nickols, director of online-tenants community The Tenants Voice, says that tenants should not be afraid to ask for relevant documentation before signing any agreement. Nickols says, “Councils, housing associations and corporations always require proof from landlords that they have consent to let from their mortgage provider – so there is no reason why prospective private tenants shouldn’t ask for the same proof.” [1]

He goes on to say that, “a reputable landlord shouldn’t have a problem in supplying the tenant with a copy of such permission.”[1]

When a landlord has the mortgage lenders’ permission to let a property, tenants are in a strong position if the property has to be repossessed due mortgage arrears.

Rent to rent

There has been a rise in the number of rent to rent dealings in the past 12 months. However, while the process is legal, middle-men involved in some deals have let to tenants without their landlord’s permission. This had led to certain landlords not knowing who is residing in their property. In other cases, a middle-man has not passed tenants’ cash onto their landlord, leading some tenants facing eviction.

How renters can avoid major renting pitfalls

Tenants should remain vigilant when handing over rent money. They should ensure all due diligence is conducted before parting with any cash and should always ask to see any agreement between the landlord and acting agent or middle-man. In addition, tenants should ask for proof that their deposit has been properly protected.

Advertising sites

Rogue landlords are less likely to come under scrutiny by listing their property directly. Tenant’s therefore should remain vigilant when responding to any landlord advertising on listing sites.

Paul McCambridge, head of property at listing sight Gumtree, said that tenants should keep their wits about them when looking for rental property. McCambridge said, “if it seems too good to be true, it probably is. If the price of rent is unusually low, there might be a catch.”[1]

He goes on to urge tenants to, “check other similar properties in the same area to get a good idea of what you should expect to pay.” Additionally, McCambridge says, “It sounds obvious, but you should always visit a property before handing over any money to a landlord. People who are not willing to show you their property or meet with you before accepting you as their tenant might not be legitimate.”[1]

Transferring Money

Fraudsters are persistently trying to persuade their tenants to use services such as Western Union and Moneygram to transfer their deposit money. Both are legitimate businesses, but neither should be used when transferring deposits or rent money.

Peter Barnes, senior manager in global investigations at Western Union, said that there are three measures to follow that will avoid falling victim of fraud. Barnes outlines these measures saying, “never provide your banking information to people or businesses you don’t know; and never use a money transfer service to prove you have funds available for a deposit or any purchase.”[1]

[1] http://www.landlordexpert.co.uk/2014/02/17/from-the-tenants-point-of-view/