Part 3: The reference decision
Does Movem provide a decision?
Yes, we will give a decision on each applicant. We recommend you use our default criteria, however it is possible to configure your own criteria to accept more or less risk.
We have the following decision outcomes and recommendations:
Acceptable: We recommend you proceed with this applicant ☀️
Acceptable with conditions: This is a recommendation on the basis that the described conditions are met. For example, "acceptable with Guarantor", or "acceptable with rent paid up front". 🌤
Unacceptable: We recommend that you do not let to this applicant ⛈
Our default criteria has been mapped to be identical to Homelet's decision engine. To summarise:
Permanently employed or self-employed
The applicant must be employed, earning enough money to meet the affordability requirements (by default 2.5x annual rent).
Applicants who don't meet the affordability requirements will require a guarantor.
Income can be verified through online banking, using our internal benchmarking, OR:
Homelet will require a suitable employment reference over the phone or email.
Unemployed or UK students
- Will always require a guarantor
- International students sponsored by their Government don’t require a guarantor if they can provide proof of sponsorship, and the annual amount is at least 2.5 times the annual rent
All benefits can be verified using Movem, or manually through the hybrid.
- We can accept Disability Living Allowance.
- We can’t accept Incapacity Benefit if it’s short-term.
- We can accept both Working and Child Tax Credits. However, we don’t accept the childcare element as this is for childcare purposes only.
- We can accept Child Benefit.
- We can accept long-term Incapacity Benefit.
- Carers’ and Foster Carers’ Allowance will be assessed on an individual basis.
- The applicant must have savings of at least three times the rent for the term of the tenancy. Else it will be considered on a case by case basis. Savings can be proven through both instant and hybrid methods.
- The applicant can be approved instantly by verifying their previous rental payments through online banking, OR:
- Through a satisfactory reference from the applicant's current landlord/letting agent.
Paying rent in advance
- Applicants paying the full rent in advance aren’t eligible for Rent Guarantee cover. Applicants paying part of the rent in advance can be considered upon application.
- We don’t require a reference from the applicant’s financial referee.
- Adverse credit history (CCJs, bankruptcies, etc.) can be overridden, depending on circumstances.
- We still require either verified rental payments, or a landlord or managing/letting agent reference if the applicant is a private tenant.
Can a tenant find out if they'll pass before completing the reference?
It's really annoying for everyone involved to complete a reference, only to learn they passed, but don't earn enough to be able to afford the property. It's important our clients understand the criteria they are using, and complete pre-application checks. For example:
- Checking the applicant is employed.
- Preparing the applicant for what will be asked in the form.
- Ensuring they have appropriate credentials/documents ready.
- Confirming they earn enough — based on the affordability calculation — to rent the property in question.
Reapplying after a fail
Applicants can reapply for a reference as many times as they like, however they need to be invited by a Movem user, and the client will need to pay for each attempt.
We recommend that you only reapply after an unacceptable decision if there have been material changes to the application. For example, they have a new employment.
Disputing referencing decisions
If you wish to dispute a referencing decision we've given, please get in touch with your account manager and we'll be able to discuss this with you.
Rental affordability in joint tenancies
Let's say the property in question requires a rental affordability of £1000 a month. You have two tenants sharing together; Mr X and Mrs Y.
Mr X earns £200 a month, and Mrs Y earns £2500 a month.
Mr X would not be approved based on our default criteria. However, if renting with Mrs Y, their combined affordability would be higher than the rental amount, and they'll both pass, as long as Mr X was suitable for a zero rent share.
The important thing is that the overall affordability is sufficient.
Define: Zero rent share
This is a term for someone who is renting, but not responsible for any of the rent. In the example above, Mrs Y would be responsible for everything. Mr X still needs to pass other parts of the reference though.
Editing information after decision has been made
From time to time applicants will fail a reference, but then request to modify some information and see if it passes a second time round. Although this makes sense, from a logistical stand it causes problems. 🤯
As an example; once the applicant has finished the process, we run a credit search. If the applicant was able to go in a week later to modify their address history, we would need to run a new credit search, to ensure that nothing has changed in the interim.
Then, if we're running a new credit search, we may need to verify rental payments again, if they were attached to a specific property, or looking for dates of a previous tenancy.
This quickly unravels and you have to do the whole thing again.
With this in mind, we do not allow information to be modified once it's been submitted for a decision. If the applicant wishes to re-apply with new information, they will need to complete a fresh reference, and agree to another credit search.