To think letting agents have no right to go through my bank statements?

[oversomeniagara]

We're trying to move flat and the letting agent has demanded three months' worth of bank statements on top of the usual credit checks, employer and landlord references.

I think this is really unnecessary and intrusive and I hate the idea of strangers combing through my accounts. I sent the bank statements with everything but salary, utilities bills and rent blocked out and now they are saying they have to see the full statements to check that we aren't 'living in an overdraft'. I am I right in thinking this is none of their business so long as the rent and bills are paid?

The flat is actually £500 pcm cheaper than our current house (we live in London...) so that combined with our excellent references and credit ratings should surely be enough! I am really outraged and disgusted by this whole process!!

I have never used an overdraft - and am of the generation who thought debt - other than a mortgage - was to be avoided - mainly because paying money to someone for borrowing - especially in a time of low inflation - is just like stuffing tenners down the toilet.

So I would find it "unusual". Having a good wage, but dipping into being overdrawn regularly seems odd.

I refused this. They processed my application anyway.

Although to be fair, the current agent hasn't asked. Just references from work and current landlord, nothing else.

Mine asked this as well but I don't think they combed through them in any detail. In fact, I was worried as my bank statement doesn't show my total income as it's all a bit complicated, it looked well below the amount declared by me and my employer's reference. I explained why and they were happy enough. I don't have an overdraft though.

I don't think my landlords are bastards for asking this. I'm renting from an agency that owns the majority of the properties they let, not a third party agency or estate agent, and would recommend anyone renting try to find somewhere like this. They make their money from the rent itself, not money they can cream off at the point of letting, so admin/credit check/reservation fee was less than £100 all told.

Pantone363
That is criminal a letting agent should be not charging £400 application fee. It sounds like a scam.

I cannot understand why a landlord would want bank statements. Usually an employer's reference is enough. Many landlords have an income threshold that they insist that tenants are earning over or have a guarenteeror. I suppose the only place for statements would be if an employer was arsy about supplying a reference.

As others have said they can ask, but you don’t have to agree!

Having worked as a letting agent many moons ago we were forever having to bring in more thorough checks or ask for larger deposits from potential tenants for no other reason that landlords were getting stung by unscrupulous behaviour by said tenants.

Although it is popular these days to bash landlords I can say that there are just as many crap tenants as there are crap landlords, neither group can claim any moral high ground from my experience. I have seen tenants skipping on their last month’s rent before disappearing into the ether leaving behind them £000s of damage that can only be described as outright vandalism, I have also seen landlords try to knock few hundred quid off a deposit because of a single blown light bulb or have zero understanding of the concept ‘reasonable wear and tear’ as they forensically examine every smudge around a wall socket or slightly worn carpet by the front door.

At the end of the day blame those tenants who act like arseholes for the inconvenience you are experiencing now.

We needed a guarantor two years ago, and they did all the checks on them, but then wanted to see their bank statements too!! Needless to say we pulled out, and rented somewhere else, where we've never been late on rent. It's very intrusive. Credit/employer/landlord checks really should be enough.

Good for you SomewhereIBelong. As a feckless twentysomething obviously I am dying to go bankrupt from debt and love wasting money! Not that it matters but much of the overdraft is from business expenses anyway.

This is standard procedure. I've rented privately in London for 10+ years.

I assume other replies are from people who don't rent or people elsewhere in the country. I think the bank statements are to check your income is what you claim, they don't go through them scrutinising how much you spend in TopShop.

Galvanised- I did leave salary, bills and rent transactions in. Just blanked everything else out. They asked for the full statements because they said they wanted to check if we used an overdraft.

I should try to calm down now. We've sent the statements across and cooperated with them.

Pantone- if I was your friend I would be contacting Trading Standards about that!

I live in my overdraft- why wouldnt I- it is totally free (no charges at all). It is a specialist account. I can keep my money on deposit and spend the banks.

I rented for years and never came across this. Ideally I'd say 'vote with your feet' too but I understand that it's hard to.

I had this with one letting agent who made me print off my statements in front of them and then go through them transaction by transaction - it was humiliating as I do have loans and credit cards but they questioned everything, meals out, shopping. I've rented for 16 years and have never missed a payment.

I think the government are going to make it so your rent payments show up on your credit reference file so serial defaulters will find it harder to get a property. Not too sure how I feel about that though.

This is depressing.

When I was in my early twenties (10 years ago), DP and I rented in London. In those days, letting agents did a credit check, asked if we were working (and I think we handed over a copy of our contracts) and that was it. We had cats back then, which we found perfectly easy to house in two different rented flats (I think we got turned down once for a flat because we had pets, but generally it wasn’t a problem). No one ever gave a toss that we lived in our overdrafts and it was none of their business, as long as we paid our rent which we always did.

I also don’t think there’s anything intrinsically wrong with having an overdraft. I had an overdraft when I came out of university. I paid it off, over time. It certainly doesn’t mean you don’t deserve somewhere to live. How on earth do people function in London if they are young and starting out, or getting back on their feet after a difficult period?

I would never rent out any of our flats unless we had seen 3 months bank statements!

Four years ago, a prospective tenant applied to rent one of our flats. He wasn't keen to show bank statements and kept shouting about invasion of his privacy.

When he eventually provided them it immediately became obvious he was paying rent on a number of properties (estate agents details were on as a reference for the payment details) and he was also receiving various sums into his accounts from what looked like "tenant".
He was effectively renting flats and illegally subletting them.

Having an illegal sub tenant would void all our insurances and breach mortgage conditions.

So yes bank statements serve to show that you're a genuine person. You'd be surprised how many are not!

MrsF, but that's (I hope) a fairly extreme example. I think going through someone's bank statements is an intrusion of privacy; I have nothing to hide but if an agent asked me that I'D be 'shouting' about it too!

I'm in my 40s and have a mortgage and I'm always overdrawn. I've also never missed a mortgage payment (or a rental payment back when I was renting) or defaulted on a bill or credit card or anything.

Just looking at what someone spends and what their overdraft arrangement is, apart from being massively intrusive, is an extremely blunt instrument, IMO.

YABU.

I can totally see why they would want to see your statement, to make sure you live within your means and can afford to pay the rent.

Even if you have managed to pay your rent up to now, you could be (for all they know) slipping deeper and deeper into your overdraft, relying on payday loans etc. This wouldn't show up on a landlord reference or credit check necessarily but could mean that you are likely to get into financial difficult imminently. And therefore not be able to pay the rent possibly sometime in the future.

I say this as a mortgage adviser, we ask for bank statements for that reason to ensure the mortgage payment is affordable (on top of credit checks and references). I think the same principal should apply to rent.

the top of the bank statement says
money in
money out
closing balance.

Assuming you havn't redacted that, then it's plenty enough to see if you;re living in your over draft.

e.g money in £2000
money out £2100
closing balance 500 OD every month suggests that you're living in your over draft and heading for trouble.

Anything more than those headlines are nothing to do with them. it's not their job to see what you've spent money on!

The thing is, what if people ARE living in their overdraft? Should that stop them from renting anywhere full stop? What should they do in terms of finding somewhere to live? Yes, you can say, pay your overdraft off but often tenants are given 8 weeks to move out and there might not be enough time to pay it off. I think if the bank trusts someone to manage an overdraft that shouldn't be an issue combined with good landlord, employment and credit references. Equally what if you get someone who has perfect bank statements with no overdraft facility and they move in but lose their jobs? I agree with the pp that bank statements are a very blunt instrument (not to mention my initial complaint of being incredibly instrusive!)

OP, I see why you are a bit peeved but as a landlord myself, I would like you to see it from the other side.

Essentially you are correct, they do not have any rights to demand you show them any financial information but nor do they HAVE to rent out their flat to you if you decide not to show them what they are requesting.
Obviously you value your privacy (and good on you), but if I received information with lots and lots of bits blacked out I'd be very cautious too and here is why....

Tenants in the UK have so much protection that if you get one that can't / won't pay the rent or doesn't look after the place (or whatever) and you need to terminate the tenancy it is the MOTHER OF ALL FUCKING NIGHTMARES for the landlord.

I had this happen to me once and after 9 MONTHS of shit I went and knocked on the door with £1000 cash in my hand and said to the bloke 'take this, fuck off and never darken my door again'... Happily he accepted and was gone within hours. Unfortunately I was left with over £6000 worth of damage to the property and almost a YEAR of unpaid rent owing. When totalled up with the money I had to hand over just to get rid of him I was almost £15,000 out of pocket!!!

I maintain my houses as if they were my own and most are in my local village so I get to know a lot of my tenants as friends when I see them down the pub or in the shop but if you're renting from me for the first time I make no apologies for wanting to know absolutely EVERYTHING about you. I don't use agents so I keep fees low but I do now demand a very big deposit (3 months rent if I know you / have dealt with you before or 6 months rent if you're a total stranger).

Also, the agents you are dealing with are trying to protect themselves as if something similar to my tale of woe happened with you it is most likely to be the agents who would be picking up the £15k tab (depending on their contract) , not the owners of the property. This might explain why they are being (in your eyes) a little over zealous.

In regards to my friend (sorry to go off topic) the fees were to apply for the property/credit check/admin fees. They said landlord had asked for 3 or 4 applicants so he could pick the best one.

Credit check was run because she can see the footprint on her report (which shows she has excellent credit). Agency then said that LL had decided not to rent after all.

She only found out about the other applicants after someone posted on a local FB renting page about the same thing at the same property.

Agents are well established in town.

Well they can knock themselves out looking at my exciting payments to Lidl & TFL. I think I was right to stand up for myself but unfortunately they also have a significant holding deposit from us so we didn't have much choice as we would have lost it if we backed out :(

Sorry about your nightmare tenant, Manin. They give us tenants a bad name. However, I would argue that track record with previous rentals would be more of an indicator of being a good tenant than looking a bank statements. I mean, I could have millions the bank but still trash the place/ not pay the rent. Tightening up referencing would make more sense IMO than demanding bank statements but you are right, I do like my privacy and i have to admit i have a bit of a chip on my shoulder about renting that others perhaps don't have ;)

If you pay fees/interest on your overdraft then the bank isn't trusting you to use it, they are making money out of you so of course they aren't demanding that you clear it!
I have been onlying occasionally overdrawn in 25 years through various jobs, redundancies, mat leave. Because to me being overdrawn is using someone else's money which should be paid back asap, not an ongoing thing.

If you have two good salaries and are constantlc overdrawn then the letting agent is right to see that you are not mismanaging your money.
playing devils advocate here, but, living in your overdraft and keen to move to a much cheaper property? Would flag up potential financial problems to a letting agent.

I have rented in the past so please don't throw that shoulder chip at me... I'm just trying to find reason why they might want to see statement detail.

Or maybe we are trying to save more money so we don't have to rent any more?? Or if you were living in overdraft, maybe so you could pay it off? That smacks of being damned if you do and damned if you don't to me.

Anyway, we are not constantly overdrawn! But what if we were? Should people with overdrafts not be allowed to rent? If so what should they do?