Tenant referencing is inevitable for anyone looking to rent a new home, and typically immediately follows a stressful and frantic period of house hunting.
For an applicant, referencing is often perceived as 'standing in the way' of them finally being able to move into their chosen property and is rarely remembered as a positive experience. Whether a lettings agency outsources the referencing process or not, ultimately, a sub-optimal referencing experience for applicants reflects poorly on their business and can damage their off- or online reputation, and even compromise deals!
Marvin Luksenberg, Goodlord’s Head of Referencing, has a background in building processes and systems to support the operations of highly successful and exceptionally customer-centric tech businesses. Being a renter himself, he joined Goodlord in 2017 to fix tenant referencing and bring it in line with the expectations of the smartphone-wielding, Airbnb and Uber-booking consumers who make up 'Generation Rent'. Here, he shares some insights about the major pain points reported by applicants when being referenced by traditional providers, and provides advice for agencies to consider.
Having to hand over excessive amounts of personal data
There is significantly increased awareness around data protection and privacy among the general public in the wake of the Facebook and Cambridge Analytica scandal, and ahead of the enforcement of the GDPR - a seismic standard affecting just about any organisation handling data about Europeans. In fact, according to a recent YouGov survey, 80% of UK consumers now consciously try to limit the amount of personal information they share with businesses. Traditional referencing companies collect and store mountains of valuable personal data which consumer brands can only dream about, but crucially, typically request even more than is needed and do a poor job explaining why they need any of this data or what they will do with it. Do they really need three months of payslips and a copy of my employment agreement? How will my National Insurance number help? Should my smoking habits matter? How securely is my data stored and how long for? These important questions, among many others, are common and highlight a concerning lack of transparency, not to mention obvious (and potentially very costly) non-compliance with the GDPR.
The right referencing provider is one that takes your customers’ privacy and the protection of their data extremely seriously, and who isn’t the next data breach scandal waiting to happen.
Needing to work around the provider's constraints
For applicants, the outdated state of traditional providers becomes apparent from the earliest stages of the referencing process when they are asked to fill out pages of paper forms, or lengthy online forms which are carbon copies of the paper equivalent and rarely optimised for mobile devices (read: unlikely to be filled out on the go). The chances are basic personal information already passed on to the lettings agent will have to be provided again. Throughout the process, the provider will contact applicants by phone without restraint and with little consideration for the time of day and the potential disruption to their work or commitments. They'll dictate how applicants should submit additional details or documents needed (usually through email; an unencrypted, risky channel!) and will request assistance from applicants when their emails and calls to referees are unsuccessful — rather than question their own approach. Because these providers usually have targets to hit (not unlike a call centre) and view agencies as their lone customers, they won't hesitate to put pressure on applicants to get things moving.
An experience-focused referencing provider works around applicants' preferences, provides them with options and is able to deliver without relying on them to do the heavy lifting.
Waiting — and not knowing
Ultimately, applicants may be able to tolerate an intrusive and admin-heavy process if it is a quick one, but efficiency has historically not been the forte of most referencing companies. Though their operations are supported by IT systems, they are not technology businesses at heart: despite the astounding rate of technological progress and the surge of the on-demand economy, 'comprehensive' referencing checks have required an average of 3-5 days to complete for decades. This is at odds with applicants who want near-immediate certainty on their eligibility to move in and who may have a tight window to move out, and for whom any delays are likely to cause stress and anxiety. Adding insult to injury, applicants are usually left in the dark when the process drags on and are unlikely to receive an explanation without calling the provider themselves.
Favour a technology-driven provider with a modern and structured approach to referencing (relying on process, data, and supported by automation) who is able to obtain information and identify red flags quickly — providing applicants with an outcome sooner. In addition, the importance of clear, detailed communication with applicants every step of the way cannot be understated.
Tenant referencing has to evolve to stay relevant. Goodlord references thousands of tenants each week for hundreds of forward-thinking lettings agencies across the UK and is at the forefront of innovation in this space. Comprehensive references cost as little as £5 per applicant; find out more by getting in touch!