We are proud to have a 98% successful rent collection rate, thanks to our comprehensive tenant vetting process and rent collection functionality.
They always say: “Prevention is better than cure”. And we 100% agree! The same principle applies to renting out your property – avoiding placing a high-risk, non-paying tenant by conducting a comprehensive screening on the applicant is better than placing the first applicant and struggling to get any form of payment out of them.
This is how we maintain such a great rental collection rate:
- Extensive Tenant Vetting
In uncertain times like these, we know that tenants might find it challenging to meet their financial obligations, but we also know that landlords need to receive their rent to cover their property expenses.
It’s always important to remember that renting out your property is ultimately a business. So even though we can sympathise with a tenant’s reason for default, a landlord can’t afford to have a non-paying tenant remain in the property indefinitely.
It is, therefore, imperative for us to only place a tenant in your property once all necessary checks have been done and signed off by our specialised team. Of course, this does not guarantee that the tenant will never default, but the chances of having a non-paying tenant in your property are significantly lower.
Things we consider when analysing over 180 data points during our tenant vetting process:
- Bank AVS Checks
- Credit Bureau Integrations
- Reference Checks
- Flag Fraudulent Applications
- Employment Confirmation
Over the past few years, we’ve comprehensively vetted many tenants and either placed these tenants in our landlords’ properties or rejected the applications – this decision is all dependent on the outcome of the vetting process.
Below are a few general reasons why we would possibly reject an application:
– Not financially suitable to afford the rent
– Does not have a good credit record
– The previous landlord did not provide us with a positive reference
– Income cannot be verified
– No stable employment position
– Fraudulent application
Whenever we reject an applicant, it is never based on personal preference but purely in the landlord’s best interest. We treat each application objectively and allow tenants to provide us with additional proof to eliminate the above.
- Following the correct legal procedures when a payment has been missed
- Once payment has been missed, we immediately take steps by triggering a Letter of Demand. This Letter of Demand allows tenants to settle their arrears within 20 business days, based on the CPA requirement when a lease agreement is signed. (The only exception is a non-CPA or month-to-month lease agreement that only allows 7 business days.)
- Arrangements on arrears can be accepted; however, arrangements are assessed based on the tenant’s current situation and rental payment history.
- If a payment arrangement has been made and is not being adhered to, our lawyers take action, and no further arrangement is accepted.
Following the above steps makes it easier for our lawyers to submit the eviction papers and for eviction to proceed, as it shows we have tried to assist the tenant and allowed time for them to settle all arrears.
Following the correct procedures reduce the chances of the tenant staying in the property for longer than is necessary.
- Maintain open communication at all times.
- We send out automated reminders and follow-ups on arrear amounts.
- Constant updates to landlords when there are defaulting tenants (landlords are ALWAYS copied on responses between Preferental, our Lawyers and the tenant).
- The landlord has the visibility to see whether their tenant has settled their arrears or remains in breach.
No eviction will continue without informing the landlord and having a signed Power of Attorney.
There you have it! By focusing on the above three points, we can proudly say that Preferental has an above-average successful rent collection rate of 98%, which beats the industry average of 77%, giving you, as the landlord, the peace of mind you deserve!
READ MORE: PropTech yourself before you wreck yourself