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I was having real trouble trying to read the LRS/Equifax credit report but my personal data controller has just explained it to me in just under 10 minutes and it all makes sense now!
I also didn't realize that I got 3 free lifestyle credits for each report I do - what a bonus!
My letting agent told me that they'd carried out a detailed Experian report which told them that the tenant was fine because there were no CCJ's registered or previous credit problems.
Having had a few bad tenants in the past from 'glowing Experian reports' through my agent I decided to do my own investigation and found the Landlord Referencing website.
The Basic Equifax report (after a helpful explanation from LRS on how to actually read the report instead of just scanning over it) shows that my applicant does not have any CCJ's BUT also has no financial history recorded at the address that they provided and that they are not on the electoral roll - which gives them a very low credit score. It also shows me that a lot of people have lived at the address that they provided, which makes me think is this a bail hostel or something?
Whereby the information that I got before from my agent seems to based on the fact that the reason they were 'good' was because nothing bad was flagged up it seems that the LRS report questions why a 24 year old professional would not be on the electoral roll or at least have a financial record of a bank account or telephone contract or utility bill direct debits...?!!?
My main question now is WHERE HAVE THEY COME FROM ?!
The difference seems to be not about what you know based on what the tenant has given you; its about what they haven't given you that you don't know.
I also understand now that credit referencing companies update their files approximately every 6 months, so the Lifestyle Reference is an integral part of the referencing process as it is up to the minute or in 'real time' as data control described it.
I have now instructed my agent to ditch Experian and use Equifax and LRS!
EllyJo, the problem with any referencing is that you can only go on what you are told by the tenants. Some referencing companies do not ask for a National Insurance Number as LRS do. Therefore if an applicant lies about where they are living (living with parents is one ploy) and does not give a National Insurance Number, they can avoid detection.
With LRS a National Insurance number plus a date of birth will show a result one way or the other, but only if they have been uploaded to the system.
EllyJo, the problem with any referencing is that you can only go on what you are told by the tenants. Some referencing companies do not ask for a National Insurance Number as LRS do. Therefore if an applicant lies about where they are living (living with parents is one ploy) and does not give a National Insurance Number, they can avoid detection. With LRS a National Insurance number plus a date of birth will show a result one way or the other, but only if they have been uploaded to the system.
With the LRS/Equifax credit report you don't need a national insurance number Lyndon, just their date of birth. But I understand why the Lifestyle Referencing system needs both to work.
Thanks for showing me how to login and change my profile avatar LRS! I will share some more stories soon!
I have found that a full report may throw up addresses they did not tell you about. It did for me and I realised that bad tenants will only tell you what they want you to know. So the more detailed the reports the better.
I do tenant vetting for various estate and letting agencies in Shropshire and one thing is an absolute certainty - rogue tenants are becoming more and more adept at trying to beat the system.
My Top Tips for Getting the Right Tenant
If you have done all of the above and the Applicant is given a tenancy, then check that the person named on the lease agreement is the same as the one moving in.
Having been the victim of an agents verification for a tenant, which they supported with a rather desultory report from Homelet, I cannot emphasise enough how diligent a Landlord should be in personal intervention of testing the information supplied. Ensure all references are correct and presently LRS is the only organisation in the UK that can assist you with this. Insist on written confirmation of past rental history, written confirmation of employment and salary, written confirmation of utilities paid and a verified identity document and birth date. And follow up on this information personally.
I will not solely rely on an agent or Homelet in leasing my properties again. An 8 month eviction process at my cost, with a bill for unpaid utilities and damages to my property, was a lesson I do not wish to repeat.
Arm yourself with knowledge about your tenant to avoid the pitfalls inherent in being a Landlord in the UK. It's the only defence you have against unscrupulous tenants who take advantage of a system overwhelmingly tilted in their favour.
EllyJo - the other problem with ALL Credit Reference Agencies is that in respect of the Electoral Roll, the public have the option to tick the boxes that PREVENTS any of their details being given/sold to outside organisations or being able to be viewed by the Public.
It may well be that your 'tenant' selected this option not realising this may prevent it appearing on Credit Reference Searches. I found this out one year when I ticked one of the boxes and around 8 months later got a letter from my bank asking if I had moved whilst I was re-mortgaging.
Also, just because a property appears to have a lot of tenants does not always mean the tenants are bad, it could be any one of a number of reasons such as a Bad Property or Bad Landlord, it might be let on a short term basis only as tenants have lost one property/split with a partner/ etc. and needed something quick and cheap whilst looking for a better property.
From 32 years experience of dealing with Property, I have found from experience that a CREDIT REPORT is only as accurate as the information supplied by various sources and they can often contain incorrect data, miss out data and rarely reflect the TRUE picture of a persons circumstances... for example, your tenant (male or female) may have left an abusive relationship and have been in temporary sheltered housing whilst seeking a new home. These people do NOT appear on the Electoral Roll and the address whilst given to you is normally NOT public knowledge.
If you have concerns, get an employer reference / bank reference. If the tenant is genuine they normally don't mind supplying them and their personal circumstances just might be too much for them to discuss with a letting agent.
I have just carried out my first referencing experience using the new system, after getting a quick tutorial over the phone I found it very quick and easy. I sent my new tenant the application form straight to their computer (Ipad I think) from my membership area which cost me nothing, I received it back and filled out an hour later and then carried out a detailed financial report and lifestyle reference which came back and was all ok. Once I had received the above I then sent out an application for an employers and previous landlord reference which was again free from my member’s area and they have now both replied to my email with a positive reference.
Paul you have asked me to leave a testimonial on whether this is this the best tenant reference I have ever had and I have to say (after I worked out how to do it which took me ten minutes on the phone with Brandon) the answer will have to be “YES” and the cheapest on the internet for what you get. I am a landlord and can’t state how clever it is for me but this system must be an absolute dream for Letting Agent’s as it took me 15 minutes and £12 to get the whole lot done.
Well done all of you
It is greast news because I really think we are getting there with this referencing because on the online form which is automatically generated and sent out to the Applicant & Guarantor (If there is one) we ask the questions and supportive documentation for.
3. UK STATUS.
Can you provide additional Identification
(This will need to be presented if your application is successful)
Passport/ Current Driving licence/Birth Certificate/Bank Statement/Bank Card / Identity Card/ Wage Slip/National Insurance number card/Marriage Certificate/Medical Card. Driving Licence.
My applicant tenant today sent back the following:
And that is a good start for me to determine that they are who they say they are and eligible to be in this country and working.. and that is free to activated members.
Paul Routledge CEO Tenant Referencing UK.Com
This is why I don't use an agent.
This is why I don't use an agent.
Then I hope you keep up with all the new legislation.
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