How to Buy to Let
Buy To Let Mortgage - Find a Good Tenant
Becoming a landlord can be financially rewarding and like any other
job - when you do it well it can be very satisfying.
Top Landlord Tips
When you are ready to let your property and find a tenant you will
need a proper written Letting/Tenancy Agreement. Anyone is able to draw
up a Tenancy Agreement, but it should be properly witnessed on signing
by an independent witness. Many professional landlords still prefer
to have this prepared by a solicitor. If you are planning on letting
your property for more than three years you will legally need a Lease
by Deed - this requires a solicitor or conveyancer.
Tenant Application Form
It is advised that you also get your prospective tenants to complete a comprehensive Application Form - include identification evidence, accommodation and employment record, income, credit history, references and personal details, such as: have they any children, pets, are they a smoker, how many people will be living in the property?
The application should also cover the length and type of letting, the basic terms and the rent and deposit required. The application also informs the tenant that credit checks and references checks will be made in accordance with the Data Protection Act. The more details you have officially in writing the better.
The application is an important part of your screening process for a good tenant. Remember, once a tenancy agreement is entered into it can be difficult for landlords to evict troublesome tenants.
Always check the prospective tenant's credit history and identity checks, and take up the references given. It's advisable to verify the references by telephone. If you talk to a previous landlord enquire about promptness of rent payments, any lease violations, noise levels or any complaints from other tenants. A future problem tenant can seem perfectly valid and respectable - check, check and check again before you hand over the keys to your front door! Most landlords worry most about not having a tenant in their rental property, but having a problem tenant can give you more headaches and work out more expensive in the long run.
Ensure you go through all the checks - a genuine tenant will understand the time involved. If you are not positive you could ask for a Surety Agreement from a relative willing to act as a guarantor, but trust your instincts and only rent to those tenants you feel comfortable with. If both parties are keen to proceed then you can take a holding deposit, while you go through the checks.
Tenancy Deposit Scheme
Landlords need to be aware of the recently introduced Tenancy Deposit Scheme. Starting from 6th April 2007 all deposits given to landlords for an Assured Shorthold Tenancies (covering most residential letting from 6 months up to 7 years) in England and Wales, must have a Tenancy Deposit protection scheme. This means the deposit must be lodged either with the custodial scheme - this is free to use, or there is an alternative insurance-based scheme. With the insurance plan the landlord retains the deposit and pays an insurance premium to protect against failing to repay the tenant the deposit, in case of any dispute. Informed Landlord
Depending on your target tenant market, you may need to be current regarding the Housing Benefits system and student loan finances. Your property and its location tends to dictate your market. The professional and company let tenant is generally less problematic, but not always as lucrative.
A well organised, informed and professional landlord is also more likely to gain support from the various authorities you will need to deal with, such as: your local authority, The Fire Officer, The Environmental Health, etc. Keeping current with all the latest regulations and rules involved with renting and tenants' rights is vital for success as a landlord.
It can be very useful to join your local Landlord's Association - you'll find lots of information and help from experienced landlords and advice on regulations.
How to be a Top Landlord
If you treat your tenants with respect, offer a well-maintained value-for-money property, provide a professional landlord service and carefully select your tenants, you shouldn't experience too many problems. As a landlord, carrying out careful research is vital - from when you first select your property and location, to screening potential tenants. By carefully following all the checks on a prospective tenant, a landlord can significantly reduce the risk of problem tenants and future costly procedures.