Once a suitable tenant has been found and you have accepted the tenant application, there will be some important paperwork to complete before the tenancy can start.
At this stage, the let is agreed subject to contract and satisfactory references. This is when your lettings agent will arrange credit reference checks. They will also check landlord or employment references where necessary and will talk you through any potential issues. It is important to ensure this process is completed correctly and having a professional letting agent is advantageous for complete peace of mind.
If you are happy with the reference reports, your lettings agent will put together the tenancy agreement that sets out exactly the terms of your contract with your tenant, including any special requirements you may have.
Among other pertinent details and conditions, the tenancy agreement will include the following:
- The address of the rental property
- The name and address of the landlord
- The name of the tenant(s)
- The date the tenancy will commence
- The amount of rent to be collected and the frequency of its collection
- The duration of the tenancy
- The amount of the deposit that has been paid
- The details of the tenancy deposit scheme being used
- The reasons for making claims against the deposit at the end of the tenancy (e.g. unpaid rent and damaged property beyond reasonable wear and tear)
- How and when the deposit will be returned
- What to do if there is a dispute over the deposit
- What other payments need to be made by the tenant (e.g. Council Tax and utility bills)
- Whether or not sub-letting is permitted
- Whether or not pets are permitted
- Whether or not smoking is permitted
- The notice period required from the landlord for them to access the property for inspection (this must be at least 24 hours)
- The maximum length of time the property can be left vacant during a tenancy without informing the landlord
Assured Shorthold Tenancies (ASTs)
The most common type of tenancy is an Assured Shorthold Tenancy (AST) as long as certain criteria is met. ASTs can be either periodic tenancies or fixed term tenancies. The duration can be decided upon between the landlord and the tenant; anything of six months to three years are the most common term.
Periodic tenancies have no fixed end date, but run on a month by month or basis, depending on how frequently the rent is collected. In practice, it is usually assumed that both parties are happy for the tenancy to continue until either gives notice to end the tenancy.
Finally, the contents and condition of your property should be checked against an inventory at the point when your tenants move in. It is important that this stage of the process is impartial and a specialist inventory company is often used. They will give you and your tenant a copy of the inventory check in report and if instructed another inspection at the end of tenancy to check that nothing is missing or damaged.