For letting agents in today’s rental market, the right tenant referencing is a cornerstone when it comes to giving your landlords what they want – a trouble free tenancy. Getting the right solution means you protect your landlords’ assets, enhance efficiency, and foster long term, strong and profitable relationships.
In this blog, we explore three important factors for you to consider when evaluating your current tenant referencing provider or processes. From aligning checks to your brand standards right through to implementing the correct validation checks for your risk appetite, these tips can help you navigate a changing rental landscape successfully.
1. Do your referencing checks align with your brand standards?
The tenant user journey has, in recent years, become an increasingly important part of the proposition a letting agent offers. Tenant referencing is normally unavoidable for anyone looking for a new home, and often seen as a barrier to being able to move into their new home. If you’re outsourcing your tenant referencing check, you should check that the experience the tenant goes through reflects positively on the brand reputation of your agency.
A good quality referencing provider will provide a customer experience-focused process for tenants, using integration to avoid duplication of data entry where possible, and working around applicant preferences for contact times and methods. If your provider offers a strictly 9am-5pm service, and are available only over the phone, is that going to meet the needs of your tenants and reflect on your brand positively?
Look for providers who take the burden away from the tenant through clever automation like open banking, coupled with common sense customer service, for example, extended opening times, live chat and video calls, clear data requirements and an experienced team.
Equally, look for providers that make renting more efficient for your agency too; integrated platforms, customisable and clear criteria guidelines, solutions that mean you get to choose the quality bar a tenant must meet to be accepted. By thinking how your referencing provider, product and systems reflect back on your own business, you can ensure you make a choice that enhances your brand!
2. What’s behind the referencing decision?
There are many referencing solutions out in the market and it’s important to choose the one that best fits each agency’s individual needs. Ultimately, there are 3 factors at play – speed, quality and cost.
There is nothing wrong with wanting value for money and fast referencing decisions – it’s what gives you a competitive edge. But be wary your agency isn’t compromising on the quality of the checks to achieve fast, cheap referencing.
When it comes to quality, you ideally want a provider who combines up to date technologies like open banking, credit data and certified Biometric ID tests (which certainly speeds things up and help to detect fraud!) combined with verifications by humans who are experienced and know how to go the extra mile. There are hundreds of data validation points available to referencing companies now, so it’s important to find out how many your provider is using and how in depth their checks are. Mistakes on this can be costly, and with the right provider you can get value for money, quick turnarounds and good quality decisions.
3. Are you moving with the times? Have you considered everything that has changed in recent times?
In recent years, our world has undergone significant transformations, especially when comparing it to a decade or even just three years ago. One prominent catalyst for change has been the COVID-19 pandemic, which precipitated a rapid shift towards remote work. More and more people are now working from the comfort of their homes, and many have even embraced freelancing or remote employment with international companies. While this new way of working offers flexibility and convenience, it has also presented challenges when it comes to obtaining valid employment references.
Traditionally, employment references relied on public employment details such as company landline numbers. However, with the rise of remote work and freelancing, these traditional methods have become outdated. Personal mobile phone numbers have taken the place of company landlines, making it more difficult to verify employment information and obtain reliable references. In light of these changes, it is crucial for referencing products and processes to address the evolving societal landscape and adapt to the challenges it presents.
One way to ensure that your referencing process addresses these challenges is by leveraging innovative technology. For example, Open Banking-powered referencing allows you to obtain secure, accurate, and fast financial information. This technology reduces the risk of document fraud and altered financial records, providing a reliable source of financial data for reference checks. Open Banking-powered referencing offers a robust and trustworthy solution in a world where manipulation and fraudulent activities are prevalent.
Moreover, it is essential to acknowledge the cost-of-living crisis, rising energy prices, and financial burdens faced by tenants. Some providers now offer an assessment of the applicant’s highest affordability level, so you can consider a wider view on their suitability.
Implementing a referencing solution that prioritises affordability checks allows you to assess whether potential tenants can comfortably afford the rental property quickly. Good referencing providers can even provide free pre-vetting stages, so you don’t commit to the cost of a reference without having basic data verified first.
When choosing a referencing product or service, quality is more important than ever with Rent Reform legislative change on the horizon. It’s important to select a solution that can keep up with changing legislation. The lettings industry is continually evolving, and referencing processes must adapt quickly to meet new legal requirements and ensure compliance.
By conducting a review of your current referencing processes, you can ensure that your reputation is protected, your service is excellent, and you’re able to maximise opportunities with your landlords and tenants.