Why is there so much tenancy paperwork?

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Something we are often asked during the course of preparing hundreds of tenancies each year is Why is there so much tenancy paperwork?

Towards the tail end of the year, we were assisting a tenant who was urgently looking to move. We stepped in to help them find a property. We found the perfect place and liaised with the Landlord to assist with the move in. During the process, both the tenant and the Landlord were required to complete paperwork that requested information. The tenants also had to undergo a few checks required by law, and under our business policies and processes. At different times and for different reasons, both parties while satisfied and happy to proceed. During the process, they each expressed an interest in why we collected so much data. And this is an important question;

But why though?

I’m getting to that – Why do we need to have Landlords and Tenants fill in forms? Why is there so much tenancy paperwork? Surely, it’s just a case of agreeing on the price and moving in?

In an ideological utopia where life circumstances never changed, nobody ever reneged on a deal, backed out, changed their mind, or otherwise frustrated the process then that might work. Sadly the reality is that life happens to all of us. Because of that, everyone wants some security that the other party is going to stick to their word.

Think of the last time your finances changed, or when your children were offered a school placement. We all have surprises in life – good ones and bad ones. And surprises don’t wait for a convenient time, and they certainly don’t care if you’re part way through applying to rent a home. That is why we must adopt a risk-based approach to handling property applications and the subsequent processing of those applications.

As the facilitators of an effective moving process, agents must be furnished with all the information required. This enables us to successfully complete the tasks promised under contract and expected of us. This is not only from a nuts and bolts perspective which includes property details, certifications, and head lease restrictions, but also thoughts and feelings, motivations and timings. These aspects concern all parties to the contract. Without this information, assumptions and therefore mistakes are easy to make. This can lead to real risks of financial loss and homelessness.

Some tenants and landlords we have dealt with in the past seem to have expected agents to work with very little information. In extreme cases I have been provided with some scant addresses, a name, and email details. This is clearly not sufficient data to ensure that both parties are protected. We are tasked with flagging potential issues and, where possible, avoiding any financial loss during the processes that we handle. These processes deal with large sums of money, access to property as well as heavy legal implications for all parties, including our business. Therefore, up to date and accurate information is a vital part of our business function. And we rely on our clients and tenants to provide this information in a timely and accurate fashion.

Where does this all lead?

The aim, of course, is to bring a tenant comfortably into their new home, with a clear idea of the contract terms. It also aims to provide a legally compliant landlord with appropriate advice and support. Last, but not least, it allows us to secure a steady and uninterrupted rental income to the Landlord client for the duration. All of this can be achieved with a minimal amount of risk if the correct information is gathered and processed at the start. An agent’s responsibility begins long before a tenant even witnesses a property advertised. It also surpises many to learn that this responsibility ceases long after the tenant vacates the premises.

Systems, Processes and Paperwork also serve as a reliable backup of information. Information may be required to span multiple instances of occupancy. For example, generally one does not change the carpets or re-decorate every tenancy. It helps to have a record of the last occasion this was undertaken, along with the cost.

The sometimes-laborious paperwork that tenants must undertake at the commencement of a tenancy is often tied in with the payment of deposits and fees. It does serve a multi-faceted purpose, not least in busy markets. These deposits secure the property for the tenant, and cover the costs of necessary non-invasive background checks. It is also true that it lends a degree of security to Landlords and to Agents. They then hold the assurance that the next stages may be completed without a tenant becoming fickle and aborting before a contract is signed.

Current events are likely to change this process. Under a draft bill before parliament it has been proposed that all fees charged to tenants will shortly be banned. (note: this is not yet law – we’ve had one prospective tenant recently, and quite mistakenly, quote it to us as statue, but it has not yet been enacted by parliament). The ‘word on the street’ among agents is that any good will afforded by prospective tenants will surely evaporate. Many agents will cease to assist tenants to whom they will have nothing to offer above and beyond the minimum required duty of care under law. That is, unless they want to pay a consultancy fee to a third party professional in an advisory capacity.

It makes it fair.

Another aspect of the processes and systems used in agency work is one of consistency and therefore fairness. Each applicant, regardless of background, status, religion or ethnicity, is subject to the same process. We do this to ensure that discrimination is eliminated and that information is consistent. The result is that clear transactional decisions can be made by both parties when approaching a contract situation.

In conclusion, and hopefully to provide a sort-of solution to why is there so much tenancy paperwork, is simply Trust. The most straightforward way of the three parties to each rental achieving their exclusive and mutual goals is to trust the expertise being purchased. Allow the appointed agent the space to complete the paperwork required. Remember that as agents, we do this every day. We are the experts that you’re paying for. We know how long each step in the process takes, as well as what to do when it goes wrong. Stepping outside of the process is only going to take longer and increase your risks.

The end game is that you won’t get what you want, or where you want to be, on time.