With the general election on the horizon it is unclear what will happen with the proposed ban on letting agents charging fees to tenants. There was a ban proposed that was going through a consultation process. However, a new or change of government may result on the ban never coming in. Some agents charge disproportionate fees to tenant. At Aldreds we charge a nominal £110 on application to cover the cost of the process and a small fee for the renewal of a tenancy.
ARLA the trade body of letting agents has said that the referencing process should be exempt from any ban due to the direct cost involved and the importance of the process to tenants and landlords alike.
ARLA said “Referencing ensures that tenants do not take on a financial commitment which is unsustainable. Referencing reduces the risk of tenants falling into rent arrears which often results in them being evicted and subject to County Court Judgments. This can lead to a drop in credit rating and difficulty sourcing other rental properties or making successful mortgage applications, along with difficulty sourcing low cost credit from mainstream suppliers. Quality referencing helps to reduce homelessness. While it is frequently said that referencing is available for a few pounds this is not accurate. Our primary research has shown that agents list referencing as one of the single most time consuming aspects of the role.”