To be eligible to take out our Rent Protection policy, we ask that:
- You either own the property or are legally responsible for the collection of rent
- The property will only be rented to tenant(s) who are at least 18 who will only use it for residential purposes
- A satisfactory tenant reference check has been carried out on the tenant(s) and a tenancy agreement is in place for the duration of the policy
- The first month's rent must have been received and all statutory pre-grant notices must have been issued before allowing the tenant into possession of the property
This policy can be started within 10 days from the start of the tenancy agreement or to replace comparable Rent Protection cover with another insurer immediately prior to inception. Otherwise any dispute arising within the first 60 days of the period of insurance will be excluded.
Tenant Reference Checks
Checks carried out on the tenant before the commencement of the tenancy agreement or policy, whichever is the later. As a minimum requirement, these checks must include:
a. A credit check obtained from a licensed credit referencing company showing no County Court Judgements in the immediate preceding three years, no outstanding County Court Judgements and no undischarged bankruptcies.
b. Copies of two forms of identification, one of which must be photographic.
c. Affordability checks must be carried out on the tenant by the purchaser or a licensed referencing company, which confirms that the tenant has the reasonable means to pay the rent, i.e. that their income, or combined income for tenancies with multiple tenants, is sufficient to pay the agreed rent in full.
Where the tenant has failed to meet the requirements of the credit check a guarantor must be sought who must meet the above requirements.
Where the tenant or guarantor is a company, a company reference must be carried out showing no CCJs and the agreed rent must not be greater than 85% of the company's credit limit.
How Do I Get a Tenant Credit Check?
You can get an instant check powered by Equifax from here:
https://www.mudhut.com/patron/tenant-credit-check
Affordability Checks
A payslip or proof of income from their employer or accountant would be sufficient to confirm that the tenant has the reasonable means to pay the rent.
The rule of thumb is that the tenant's rent should be no more than 40% of their gross salary (or combined income for tenancies with multiple tenants).
Another way of putting this is that the tenant's gross monthly salary should be at least 2.5 times the tenant's monthly rent.
What Are the Statutory Pre-Grant Notices?
This means all the notices that you are required to issue before you grant the tenancy, including:
- Energy Performance Certificate
- Gas Safety Certificate
- How to Rent guide
You can see more information here:
https://www.gov.uk/renting-out-a-property
Acceptable Identification
To meet the requirements of our Rent Protection or Legal Expenses product, you must have collected one form of ID from list A and another from either list A or list B.
Acceptable photo ID
- Current passport
- UK, EEA or international photo card driving license (must include a photograph of the tenant)
- CitizenCard
- EEA member state identity card
- VISA
- Biometric residency card
- CIS4 – Registration cards for the construction industry
Acceptable secondary ID
- Any other photographic identification as listed above
- Full old style driving license
- Utility bill issued within the last 3 months (gas, electric, satellite television or landlord phone bill)
- Local authority council tax bill for the current tax year
- Bank, Building Society or Credit Union statement or passbook dated within the last 3 months
- Current UK tenancy agreement (does not include any agreement not yet in place)
- Current council or housing association rent card or tenancy agreement for the current year
- Electoral Register entry
- UK birth certificate (issued within 12 months of the date of birth)
- Residence permit issued by the Home Office to EEA nationals
- NHS Medical card or letter confirming registration with a GP’s practice
- Solicitors letter confirming recent house purchase within the last 3 months
- HMRC self-assessment letters or tax demand dated within the current financial year
- Benefits book or original notification letter from the Benefits Agency
- Firearms or shotgun certificate
- Original mortgage statement from a recognised lender issued for the last full year
- Land registry confirmation of address
