It's been a while since tenant fee bans were introduced in England - June 2019 to be precise. This made it illegal to charge tenants any fees other than the rent they pay, contract renewal or modification fees (of no more than £50), default fees (such as for cutting a new key when the original is lost), a security deposit (of no more than five weeks’ rent) and a refundable holding deposit (of no more than a week’s rent).

Everything else which might have been charged for in the past such as check-in and out fees, admin fees, inventory fees and cleaning fees, to name a few were banned.

Referencing

This list of prohibited fees also included any charges for completing references for a tenant, something many landlords and letting agents used to charge tenants tens and sometimes even hundreds of pounds for.

Now, landlords and letting agents must meet the cost of completing referencing for a tenant. This will usually include a credit check which the agent or landlord now has to complete at their own expense either themselves or through a referencing agency.

You will also be asked to provide some of the other references yourself, or suggest people who should be contacted, including your employer, a previous landlord, bank and, if you’ve not rented before, a guarantor.

Be prepared

If you’re looking for rented property in a competitive market then it’s best to get these references lined up before you start viewings as they can take several days and sometimes weeks to track down.

Remember, if a landlord or letting agent takes a holding deposit from you and then asks you to provide the necessary details to carry out a credit check that you then fail to provide, or take too long, you may lose your holding deposit.

Holding deposit

You may also lose some or all of your holding deposit if you fail referencing - for example if a previous landlord reveals you damaged a property or had to be evicted for non payment of rent.

One important point here. When it comes to referencing it can go one of two ways. The most common is that the agent or landlord will 'put you through referencing' and the cost of that falls on them, not you. Or they may ask you to produce references yourself and recommend you use this or that paid-for referencing service.

This is fine, but it CANNOT be a condition of the tenancy going forward. So they can't say 'Once you've put yourself through referencing with XYZ company then you can sign the contract'. It has to be a free choice.

This applies to lots of other things too - so for example a letting agent cannot make a rental acceptance conditional up a tenant taking up contents insurance, signing up to a particular energy supplier or using a specified alternative rental deposit service.

CreditLadder can help you improve your credit score

If you want to improve your credit position by reporting your rent payments, CreditLadder is the only way to improve your credit score and position across all four of the main Credit Reference Agencies in the UK, namely Experian, Equifax, TransUnion and Crediva. Building up a high credit score has a lot of benefits, including helping you access finance at better rates - this can also help save you money.

CreditLadder also runs a free mortgage application service in partnership with Tembo which will tell you how much you could borrow.

Remember the information provided in this article is for information purposes only and should not be considered as advice.