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Self Employed


adonaghy

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I have 2 propertys and so far, with lots of info from this forum, I've managed without too many problems. Im currently advertising  and have an interested party who is self employed. Ive asked for payslips etc and contacted employers to verify post and contracts are permanent of previous tenants. Am I best to avoid , or how would you go about checking financial viability of self employed.

 

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Join  The guild of residential landlords https://www.landlordsguild.com/ you wont regret it and you will have every form (including tenancies, guarantees, and loads of others for every situation) you will ever need and a help line that will help with any situation.

They will also keep you updated with any changes in the law. For 90 quid per year you cant go wrong even if you join for one year and download all the info.

You could ask for the last 3 years of tax returns for your tenant.

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Nowadays I use gut feeling as my 1st decider.

I might drop in to the present address 'at teatime' with an extra application form to check their life style. Requesting to use the loo can reveal much.

I check the G'tor for ability to settle, in the event, at a cost of £3. The Land Registry will show when their property was bought and for how much. You will see outstanding charges (Mortgage) but not how much. It isn't difficult to assess, with online property prices, if likely to be negative equity or if they have equity for you to claim against.

You might run a check for bad credit history on both. I tell them I shall (bluff) and suggest a bad report will mean they lose their admin fee if they don't declare any adverse history beforehand. I usually get a list of mobile phone company issues, Sky, occasional bank, or I scared them and I don't see the admin fee or them again.

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Definitely a property owning guarantor followed up with a land registry check on ownership. Self employed will always have to clear more hurdles then the employed when it comes to finance issues.

Don't forget if they should fall long term ill there is a very good chance there is no income.  ( This has just happened to my Son who could not work for 2 weeks before Christmas )

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I always prefer taking 'rent guarantee insurance'. Insisting on my tenant having a home owning guarantor is a second choice for me.

If you opt for rent guarantee insurance, the company you use will have its own checks and criteria that the applicant will need to meet in order qualify for that insurance. They will do virtually all the work for you.

It is not expensive, it's tax deductible and certainly worth considering.

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Another method that can be useful is to have payments made from the G'tors bank account. I've never opted for this and it can't be policed, but if operating like this then the G'tor is carrying the responsibility of chasing the T. It also continually demonstrates the G'tors involvement and situation awareness.

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