In all honesty, I cannot see what difference failing credit references or not being able to provide a guarantor makes. If he doesn’t pay rent, he doesn’t pay rent! The type of tenancy is not really relevant as to whether he will pay rent or not but it does make it more difficult to get him out if it is not an AST.
I think there are 2 issues here. Firstly, the fact that he may be subletting not only subletting but subletting to a company for staff but also you will be in breach of your mortgage conditions unless your lender agrees to this type of tenancy agreement. It is unlikely they will allow you to let the property on anything other than a AST.
So the first thing you need to do is get consent from your lender to the different kind of tenancy agreement and they will want a copy of the agreement. I think they’re unlikely to agree to it.
If they do agree, and the tenant subsequently fails to pay rent, you are then faced with making a bespoke application for possession, without using the section 21 or section 8 process. You can still get them out, it’s just a much more convoluted process.
I would get an agreement from the agents they will pay the cost of removing the tenant if the tenant fails to pay rent.
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