Understanding your rights as a landlord
As a landlord renting out a property there may be times when things don’t quite go according to plan. Whether through a problematic tenant, an accident on your property, a dispute over deposits or something else entirely, things can quite often go wrong.
This is why it’s very important to get to grips with exactly what you are responsible for as a landlord, but also what your own rights are so that you can quickly resolve any issues when they arise and protect your assets. Here we will look at some tips and best practices as well as the recommended processes for when these kinds of situations occur.
Choosing a tenant
Letting a property is not without risks and we often hear horror stories of tenants who have damaged properties, been a nuisance to neighbours, broken conditions of tenancy and left rent unpaid. While there is no way of truly knowing how a tenant will behave once they begin renting your property, there are some methods which can limit the risks posed to you.
First of all it is important to have every potential tenant properly referenced, either by a letting agency or yourself, prior to signing contracts. A rental application form should be filled out which gives details of their previous addresses and if possible their current landlord who you can then contact and ask for feedback on their tenant – the same way you would cross check a new employee when hiring at a business. Next, you should contact their employer and ask them to verify details of their position and income. Where possible you should try and independently verify the details that you have been given by the tenant to make sure the former landlord or employer you are calling are actually who they say they are.
Next you should check their identity and credit history. This allows you to check they have the right to live in the UK and also that they are who they say they are and will be able to pay their rent on time. A credit check company will be able to provide you with details of your potential tenant’s ability to meet financial commitments. To verify their nationality and name you should ask them for the original documents that prove where they were born such as their passport or birth certificate. If you are in doubt as to whether a tenant is eligible to rent in the UK you can check using the Home Office’s online ‘Right to Rent’ form.
While it’s important to trust your instinct when renting out your property, you should also be diligent and do all the checks on a tenant before you hand over the keys – it could save you headaches further down the road. At this point it may be wise to do a brief internet search of their name as this could reveal positive or negative details about their character which may help in your decision.
Tenant responsibilities and behaviour
While you have many responsibilities as a landlord to maintain the property and deal with any problems that the tenant encounters, the tenant also has their own responsibilities and rules to follow. They are required to pay their rent on time and in full in accordance with the terms of your tenancy agreement. They are also committed to follow the rules over sub-letting which means checking with you before they invite anyone else to move in or sub-let a room. In terms of general behaviour, they are committed to acting considerately towards neighbours and not engaging in any anti-social behaviour.
They also have responsibilities regarding the upkeep and safety of a property and this means that if there are any repairs that need to be carried out – such as mould or structural damage - then they should inform you promptly rather than waiting until a problem gets much worse. They should also carry out regular checks of smoke alarms and carbon monoxide detectors and replace batteries when necessary.
One good way to make sure that your property is being looked after and also to spot any potential problems is to perform a scheduled visit. To do this you must provide your tenant with at least two days notice, as you are not able to access the property freely as you wish.
The first and most important thing to be aware of when dealing with rent arrears is that under no circumstances can you go to your property and physically evict the tenant yourself if they fail to pay their rent on time. Landlords are required to go through a legal process before a tenant can be ordered to vacate a property.
If you have noticed in your records that your tenant has failed to pay their rent on time then after a few days you can send them a formal letter by post reminding them that their rent is due. If after 14 days there is still no payment then you can send another postal reminder, either to the tenant or to their guarantor if they have one. If after 21 days you are still yet to receive any payment then you should contact them with a formal letter prepared by a solicitor informing them of your intentions to recover the outstanding rent through legal action and take steps to reclaim your property. If there is a guarantor then they should also be informed that the situation remains unresolved.
Under the Housing Act (1988), in order for you to take action to reclaim your property the tenant must owe a minimum of two months in arrears. You may then be able to apply to the courts to serve a section 8 notice seeking repossession of your property. See the ‘Ending a tenancy’ and ‘Section 8’ notices of this article for further advice on the eviction process.
Outside of the eviction process you also have other options for recovering rental arrears. If you have a good relationship with your tenant then the first place to start would be to talk to them about their circumstances and see if you are able to help them find support through services like Citizens Advice Bureau, The Money Advice Service or debt advice charities like Step Change. You may also be in a position to work out a short-term repayment plan if the tenant has a history of normally paying their rent on time.
However, if you do not have a positive relationship with your tenant then you may instead want to seek out a professional mediator such as a solicitor to help come to an agreement about any rental arrears.
Even with mediation though, tenants are sometimes unable or unwilling to pay the money that they owe. In this case you may need to consider legal proceedings to help obtain the money you are owed. Using the small claims procedures of the County Courts you will be able to apply to recover money you are owed, even if you do not wish to get possession back of your property, through what is called a Money Judgement. A Money Judgement can be served by means of an attachment of earnings, a warrant of execution (bailiffs) and other methods like a charging order or oral examination. Following a successful money judgement the tenant may also be served with a CCJ which will make it difficult for them to obtain credit in future.
Ending a tenancy
There often comes a time when you want to end a tenancy because you want to repair and renovate your property, put it on the market or perhaps to move in to the property yourself. In order to get your tenant to vacate the property you must wait for any fixed period to be over and then give a minimum of two months notice and serve a Section 21 notice. Equally, if your tenant decides that they would like to leave then they must give you the notice required in your tenancy agreement which is normally one month.
If your tenancy has gone well and there haven’t been any problems then you or your tenant may want to continue the tenancy after the initial fixed period term. Quite often there is simply a rolling periodic tenancy after this point, however the danger here is that the tenant can leave at just one months notice which gives you less time to find a replacement tenant – so it may be best to sign up to a new fixed term with your tenant.
Upon ending a tenancy there are a number of matters to attend to such as returning your tenants deposit. When you initially receive a tenancy deposit you have 30 days in which to deposit it through an official deposit scheme. At the end of their tenancy you may be able to make reasonable deductions from the deposit for things like cleaning bills, unpaid rent or bills and damage to the property.
Once a tenant has left your property you are legally allowed to dispose of any of their left over possessions after 14 days; however you should inform your tenants if possible and give them the opportunity to collect any belongings that have been left behind.
Section 8 notices
If there have been serious problems with your tenant such as non-payment, anti-social behaviour or they have broken the terms of your tenancy agreement in other ways then you will be looking to remove your tenant as quickly as possible.
However, if your tenant contract is operating under an Assured Shorthold Tenancy then the tenant can stay in the property for six months unless you can prove that they have broken any major terms of your tenancy agreement. Once those six months are up then the tenancy can be ended by either party without providing a reason for termination.
You may also be able to opt for an accelerated possession procedure. This process involves no court hearing and so is a good choice for landlords with very little time on their hands, or landlords who live outside of the UK.
It’s important to remember that the courts view eviction and removing someone’s place of abode as a very serious matter and therefore can be very strict with any mistakes made in the paperwork you provide. So, while section 8 notices and section 21 notices can be carried out yourself you run the risk of having your case held up with errors which can further delay the eviction process, so it’s best to use a solicitor to help prepare your case.
Your property is a financial investment and accidental damage to your property or the people who live in or visit it can result in lost income for you. The easiest way to protect yourself is to purchase landlords insurance.
Content insurance can be purchased to protect against damage and theft of your furnishings, legal expenses insurance for any tenant disputes that might occur, home emergency insurance to cover the cost of repairs from things like gas leaks and break-ins, liability insurance to protect against claims from tenants or visitors injured at your property and loss of rent insurance to cover you if damages leave you unable to let out your property for a period of time. Click here to learn more about landlords insurance.
Here at Rollingsons our property litigation team has extensive experience acting for landlords in relation to all manner of property disputes. Contact us on 020 7611 4848 or visit our property litigation page for more information.