Letting and managing
What do letting agents check when referencing a tenant?
Last updated 4 July 2026 · Reviewed by Nick Thorpe, founder
The short answer
Referencing checks that an applicant can pay the rent and rent legally: a credit check, income verification against the rent, a reference from the previous landlord, and a right to rent check. Most applicants pass in days. If income or credit falls short, a guarantor is the usual route. Livdin charges landlords £35 plus VAT per tenant.
Referencing is the point where a promising applicant becomes a safe tenancy, or does not. It is not a box-ticking exercise. Done properly it is the cheapest piece of risk management in letting, because almost every expensive tenancy problem (arrears, abandonment, damage) costs far more to fix than to avoid. Here is exactly what gets checked, what a pass looks like, and who pays.
What does referencing actually check?
Four things: credit history, income, rental history and the legal right to rent in England. Each answers a different question about the same person.
| Check | What it looks at | What a pass looks like |
|---|---|---|
| Credit | County court judgments, insolvency, defaults, linked addresses | No unexplained adverse history; a thin file is not a fail |
| Income | Payslips and an employer reference, or accounts if self-employed; benefits count | Income comfortably covers the rent, judged against a standard multiple |
| Previous landlord | Whether rent arrived on time, how the property was kept, whether proper notice was given | A straightforward “would rent to them again” |
| Right to rent | Passport, immigration documents or a Home Office share code | Every adult occupier verified before the tenancy starts, as the law requires |
None of these checks works alone. A spotless credit file with income that barely covers the rent is a weaker application than a modest file with comfortable income and a glowing landlord reference. We read the whole picture, then give the landlord a plain recommendation.
What counts as a pass?
On income, referencing companies compare gross annual household income with the rent, using a standard affordability multiple as their yardstick. The exact multiple varies by provider, so treat it as a guide rather than a law: joint applicants add their incomes together, and benefits count towards the total. If the numbers land close to the line, a good referencing report says so plainly rather than issuing a flat fail.
On credit, the check looks for county court judgments, insolvency and defaults. A thin file, common with younger tenants and people new to the UK, is not a fail. The concern is unexplained adverse history, especially unpaid rent or arrears with a previous landlord. And the landlord reference asks the simplest questions of all: did the rent arrive, was the house looked after, would you take them back.
When is a guarantor needed?
When income or credit falls short of the threshold but the applicant is otherwise sound. Students, the newly self-employed and people without a UK credit history are the usual cases. A guarantor is referenced just like a tenant, usually against a stricter affordability threshold than the tenant themselves, and is typically expected to be a UK resident homeowner. It is a real legal commitment, not a formality: if the rent stops, the guarantor pays. Think of it as a financial parachute, usually worn by a parent.
Who pays for referencing, and what does it cost?
The landlord pays. The Tenant Fees Act 2019 banned letting agents in England from charging tenants for referencing, so the cost sits on the agent’s published schedule rather than in a tenant charge.
At Livdin that means £35 plus VAT per tenant on a single let and £30 plus VAT per tenant on an HMO. The full schedule is public on our fees page, with no hidden charges and maintenance at contractor cost with no markup.
What happens after a pass?
The tenancy gets set up: the agreement is signed, the deposit is registered with the DPS, compliance checks are completed and the tenant moves in. Referencing done well is also why tenancies last. Our average tenancy runs 24 months across 200+ tenants in managed homes, and a well-referenced tenant who stays two years beats a quick let every time. If you are working out timings, see our guide to how long a letting takes.
One caveat worth stating plainly: right to rent rules, deposit rules and tenancy law change from time to time. We confirm the current requirements on every tenancy we set up, so the version that applies to your let is the one in force on the day.
Wondering what your property would let for before any of this starts? Get a free rent estimate and we will tell you the likely rent and the likely tenant.