Questions to ask a letting agent
Letting agent questions
I’m just in the process of selecting a letting agent. I’m looking at using them on a let only basis but I thought it would be useful for landlords to share my experience on some of the things they might want to ask before signing a letting agency agreement.
What are the letting agent’s terms & conditions?
There are no standard terms or conditions for a letting agent. There are typical agreements, but legally they can all differ. It’s important, landlords ask plenty of questions to establish the level of service and what exactly is included in the package.
What will a let only service include?
A ‘let only’ agreement will normally include:
The letting agent taking photos, writing a rental advert, then uploading it to the property portals (you really need to get it on Rightmove ). Most tenants find their rental properties online so getting a good Internet presence is vital.
What tenant referencing and credit checks do they offer?
Tenant referencing is a desk based exercise that provides a points score on the credit worthiness of a potential tenant. Find out about the tenant references they use and what data is checked.
It’s worth baring in mind that younger tenants such as students or newly qualified graduates will rarely have a good credit score. Though this doesn’t mean they are a bad risk, I would certainly want to take a tenant guarantor in this situation.
Ask the letting agent if they sort out tenant guarantor forms (you can download a free tenant guarantor form from Property Hawk) and that it is signed as a deed. Make sure they don’t charge extra for this. Also ensure that they are happy to give you the final say over whether a tenant guarantor form is required or not.
I was recently in the situation where a letting agent had lined up a questionable tenant for me, because of time pressures I was unable to sort out a better tenant, so got ‘rail roaded’ into taking them on. My saving grace in this sorry episode has been that I insisted on a tenant guarantor agreement. It’s saved my financial skin. The tenant’s non-payment of rent has at least ended up as the guarantors burden and not mine.
Will the letting agent provide a tenancy agreement?
A tenancy agreement is usually included in a let only service. There is no guarantee of the quality or the source of the tenancy agreement, so it is advisable to check the AST over to ensure that it’s up to standard.
If you do need a tenancy agreement then remember you can get a free Assured Shorthold Tenancy agreement from the Property Hawk website.
‘Check in’ and Property Inventory
A vital part of the tenancy is at the very beginning with the ‘check in’ process. Many ‘let only’ agreements with the letting agent will not include this service and stop at the point that both the landlord and tenant agree the principles of the let – the terms of the tenancy, when the tenancy starts, rental deposit amount, etc.
The landlord will then be left to arrange with the new tenant the ‘check in’, the handover of the keys and the associated paper work, preparing a property inventory and handing out of the prescribed information associated with the tenants deposit.
The cost differential between the very basic let only and the full package are significant. In Nottingham with a high quality independent letting agent the basic package comes in at £300 plus Vat, whereas the a more comprehensive ‘let only’ including the ‘check in’ is £500 plus Vat. I like to meet my prospective tenants first, so I prefer to take charge of the ‘check in’. The danger with the full package is that you might not first meet a tenant until there is a problem.
Lodging of tenants deposit
The responsibility for lodging a tenant’s rental deposit can be the letting agent’s or the landlord’s. Many letting agents will pass the responsibility of lodging the tenant’s deposit with one of the Tenancy Deposit Schemes to the landlord when it’s a let only service. This is because any direct involvement in the ongoing tenancy is ended once the letting agent has let the property and taken their payment. For a full management agreement this could be different because of the letting agents obvious ongoing interest in the tenant and tenancy.
Letting agent or landlord?
Landlords shouldn’t get lulled into thinking that a letting agent will look after their buy-to-let property as well as you could.
A motivated, well informed landlord will invariably do a better job than most letting agents. Having said that, a good letting agent is sometimes needed, maybe you don’t have enough time to carry out endless viewings, you work full time, or live remotely.
So do your research, ask plently of questions, get recommendations and check for reviews on line.
There are sites such as Allagents and another Uklettingagent that provide a star system rating for estate agents based on user reviews – a bit like Trip Advisor. I do have my reservations about these kind of sites( legitamacy of reviews, manipulation of scores etc ) but there are clearly some valid posts on there that might help landlords unearth specific issues or positives with a letting agents service. If you are considering using a letting agent it might be worth reading any reviews.
Letting agents need to be trusted, they are playing with your money and your property. Picking the wrong letting agent end up being very costly, as this recent case of a fraudulent Bradford letting agent underlines.