Home & Legacy's Guide to Tenant Referencing

Tentant Referencing Guide

Problematic tenants can be expensive which is why insurers expect a prudent landlord would check a tenant's background and their ability to meet the monthly rent before letting their property. That is why it is a condition of all our landlord policies, which include rent default protection or landlord legal expenses cover - that all tenants named on the tenancy agreement are satisfactorily referenced, along with any guarantors (if applicable).

Getting satisfactory tenant references is essential for any would-be landlord, whether they're taking out additional covers or not, but where to start?

The following guide answers the questions landlords may have about getting the references they need to ensure Home & Legacy's landlord legal expenses and rent default protection cover is valid, as well as giving them all-important peace of mind.

Download Home & Legacy's guide to tenant referencing

Obtaining suitable references

To make sure your cover is valid, the insurer requires you to ensure that your tenants and if applicable their guarantors have been satisfactorily referenced. As a landlord, it is your responsibility to obtain the references that are required - either yourself or via your lettings agency.

So what types of references are acceptable to the insurer?

A comprehensive reference from an independent referencing company

A satisfactory comprehensive assessment is recommended as it is one that satisfies all the insurer's referencing criteria.
The following are some providers who can carry out a comprehensive assessment of your tenant:

The credit referencing provider might confirm the tenant is acceptable subject to obtaining proof of address. In which case, copies of any documents you obtain to evidence proof of address muct be kept as they will have to be supplied to the insurer if you need to make a claim.

As an alternative to obtaining a comprehensive tenant reference, the insurer will accept two satisfacoty references as long as one is a financial reference from a previous landlord or a friend/associate.

A standard credit check from an independent referencing company

The credit score must be satisfactory


A reference from an employer

An employer's reference will be accepted as the financial reference as long as the tenant has been employed with the same employer for at least 6 months.

The employer’s reference must confirm the following:

  • Annual gross salary (50% of any guaranteed commissions, bonuses or overtime will be taken into account)
  • Confirmation of the position held within the organisation
  • Confirmation of type of employment, i.e. whether full time, temporary, long/short term contract (The contractual period must last beyond the end date of the tenancy agreement to be acceptable)

The reference must be produced on formal business letterhead and be signed by the HR department, finance director, managing director or equivalent.

For self-employed tenants, a positive accountant’s/solicitor’s reference which confirms income and suitability to meet financial commitments for the tenancy period will be accepted. The accountant must have worked for the applicant for over a year and submitted at least one tax return for the tenant.

The monthly rent should be no more than 40% of the tenant's gross monthly income.


So what will be accepted by the insurer for your tenant's guarantor, if one is required?

For a guarantor the insurer will be happy to accept a satisfactory financial reference only. This can be any of the above.
The monthly rent should not be more than 30% of the guarantor's gross monthly income. For an employer's reference the guarantor should also have been employed with the same employer for at least 6 months.



Frequently asked questions