Here is a question to the blog clinic about rent arrears from Jummy who is a landlord
I have a tenant who has refused to per her rent for over four months.
I have started a court case to repossess the property but the court case is two months away!
The rent arrears owed now is over £5000 and I am worried that I will lose all this money. How can I persuade the tenant to leave my property now? I know she is unlikely to be able to pay what she owes already but each month she stays, the more money I lose.
Another alternative line of action I have considered is this: I suspect the tenant is getting Housing Benefit. Is it possible to get the benefit paid to me directly?If so, how do I go about it?
This is my only buy-to-let property and I am already regretting getting myself into this. Thank you
Answer
I have some good news for you and some bad news. First the bad news.
Getting the tenant to move out
I am afraid that, however serious the rent arrears, unless the tenant is willing to go, you cannot force her to leave without a court order (and then only by using the court bailiffs).
You could maybe try to persuade her by pointing out that if you get a CCJ for the rent arrears, this will affect her credit rating and ability to get another property.
Getting the rent arrears back
So far as this is concerned, as you say, you are most unlikely to get the money any time soon.
The only possibility I can see is to get a CCJ for the rent arrears (you should get this as part of your claim) and then wait a couple of years when hopefully the tenant will be in a better position financially and enforce it then.
For example if she gets a job you could get an attachment of earnings order.
You can enforce a CCJ at any time during the next six years.
Getting the housing benefit paid to you
Here the news is better. As the rent arrears are more than eight weeks worth, you can write to the Housing Benefit Office and ask them to pay the rent direct to you in future.
The Housing Benefit Regulations provide for this so they should agree to do it.
On my Landlord Law site there is a special letter for members to use to send to the benefit office.
Further tenants
Just as a general rule, it is most important that landlords check tenants carefully before accepting them as a tenant.
As you have seen it can take a long time to get them out if they prove unsatisfactory or run up rent arrears.
So be very careful about letting them in, in the first place.
How can I get my tenant to leave when she is not paying rent?
As an alternative to continuing litigation the landlord could come to an agreement with the tenant where the landlord agrees to forfeit any right to recovery of the rent arrears and legal costs in return for the tenant surrendering possession of the property within a reasonable timeframe, say 14 days, of written notice of the offer.
Although I can appreciate making such offer can be difficult to justify in the landlord’s mind, as they would have effectively allowed the tenant live at their property for free and without consequence.
However with this particular situation, as the tenant seems unable (or unwilling) to make any payment at all, and vacant possession may potentially take another four months to achieve; it makes financial sense to make such an offer. By way of an explanation, the landlord would mitigate any further loss of rent and could potentially find a tenant who will pay going forwards generating a cash flow.
Of course if the tenant is destitute and seeking assistance from the local authority then they would not be in a position to accept this offer as they would be considered to be making themselves intentionally homeless.
I agree Jonathan, but many landlords will not be willing to agree to forfeit any of their rent.
Although realistically they are unlikely to receive any of it and as you say, this way they will at least get their property back quicker.
Just be very careful in any negotiations involving inducements and any form of persuasion for the tenant to vacate early. This can be deemed harassment.
Second be extremely careful never to put in writing any reference to the sky falling in if a tenant doesn’t respond to a s8 or s21 notice and vacate. If a local authority sees it they will accuse you of harassment and breach of PFEA 1977 Act rights of the tenant – no matter how true your statements and how well intentioned the advice re the impact of proceedngs and Judgements against the tenant on their future credit status etc.
There are a couple things which he could do to prevent this happening again.
1. Appoint an agent to manage the property. So landlords feel that agents fees are excessive, however by having an agent they could’ve / should be able to have taken faster action.
2. There are schemes available for landlords called rent insurance / guarantee. The landlord pays a small fee each month and he is protected against arrears.
3. Have the back up of a guarantor and have the guarantor sign a guarantor agreement, this gives you another avenue should arrears happen