Estate agents reference fees

[akist]

Hi guys,

Since I was in these forums, I thought of asking here.

We are looking to rent a flat/house for my son who is on his second year at uni, and we have looked at a few possible houses and the estate agents have asked us for a £160-£200 upfront admin fee for taking "references". I have reacted to that as I have not yet signed anything, so why should I pay £160 with no way of knowing that the landlord will eventually let his house to me or that I will want to rent his house?

I was expecting to have some binding agreement in place before money changes hands. And I do not see why a credit check should cost me £160 fee when it should be done for free, this is the estate agents job after all. Why am I paying them to do their job?

Thanks

 

[sodthisforfun]

Sadly seems to be the norm now :https://www.thehouseshop.com/property-blog/who-pays-for-tenant-referencing/11448/
But I would also be wary of the high cost and no binding agreement. See if there is a better and cheaper estate agent out there?

 

[bernardgreen]

Most universities have accomodation departments who (should) have a list of reputable landlords / agencies for students to contact. Have you approached them ?

 

[motorbiking]

You have an argument that as a student its pointless. Are they asking for more than 1 months rent up front?

The problem is, its basically a scam, but its likely that they will have lots of other perspective tenants who will pay. You can always try to haggle the rent down a bit. The one you can dodge is tenancy extension contracts. An agent will try to charge you a fee for arranging an extension after the period of the first (min 6 month) assured tenancy. You can at that point, tell them to do one and exercise your statutory right to a rolling tenancy. The LL shouldn't care as they will be saving fees also.

If you really want to, see if you can get contact details for the LL in advance and ask them if they mind waiving the background check in exchange for adding the cost to the deposit. Everyone is a winner - except the agent

 

[SirGalahad]

Don't pay it. You will find letting agents are even more opaque than estate agents. Walk away from such behaviour.

 

[EFLImpudence]

Even this Government agrees:

https://www.gov.uk/government/news/government-action-to-end-letting-agent-fees

 

[HawkEye244]

Until he agrees to rent the property there should be no fees. If he agrees to rent one then expect to be hurt by those fees. My tenants paid £300 to the agent I used to find a tenant and they came to me later feeling scammed. I said I had no idea. Agent took from both of us.

 

[vinty]

Hi guys,

Since I was in these forums, I thought of asking here.

We are looking to rent a flat/house for my son who is on his second year at uni, and we have looked at a few possible houses and the estate agents have asked us for a £160-£200 upfront admin fee for taking "references". I have reacted to that as I have not yet signed anything, so why should I pay £160 with no way of knowing that the landlord will eventually let his house to me or that I will want to rent his house?

I was expecting to have some binding agreement in place before money changes hands. And I do not see why a credit check should cost me £160 fee when it should be done for free, this is the estate agents job after all. Why am I paying them to do their job?

Thanks

You can check you own credit rating for free, I did it 2years ago, you get a free trial for a month.

 

[Iamchamps]

You can check you own credit rating for free, I did it 2years ago, you get a free trial for a month.

So many companies offer this for free now for ever. ClearScore and noddle to name a few.

 

[akist]

They did not say "credit rating" but "referencing" or similar. Their non refundable fee is £160 before any other expenses. It sounds like a scam to me because they are contracted by the landlord to rent the properties. They are not contracted by the tenants, and they are getting paid handsomely to do their job which is to find suitable applicants, and if they want to do credit checks, or any other record checks, it is their job! I instinctively reacted but my wife said, "do you want the flat or want to lose it?"... This should be made illegal, like tax evasion is illegal, and that would put a stop to these underhand practices. Oh by the way the scammers demand £160 from each tenant!

 

[EFLImpudence]

It is normal practice by agents to charge thes fees.

That's why the Government is proposing to make them illegal.

 

[motorbiking]

I instinctively reacted but my wife said, "do you want the flat or want to lose it?"

She's right..

They are charging the landlord around one months rent for the same service, with contract arrangement charges on top. Unless you can find the landlord without them - you pay or you don't pay.

One option (that I would cautiously recommend) is to have the tenancy in one persons name. I also don't recommend that you act as guarantor. If the agent wants a guarantor then you should consider taking the tenancy out in your own name and requesting the right to sub-let to named individuals with the right to vary these subject to the landlords consent.

Make sure you look out for joint and several liability clauses, in which case a single tenant and a contract between tenant and other occupant is better.

Its also not unreasonable to see a copy of the agreement before paying your fees.