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New rent arrears guidance issued by leading housing organisations

A number of organisations from across the housing sector have teamed up to support landlords and tenants facing rent arrears as a consequence of the Covid-19 outbreak.

The organisations are launching guidance offering practical ways in which landlords and tenants can work to address arrears that might be building as a result of the pandemic.

The guidance suggests that both parties need to raise concerns that might be arising early on, along with advice about measures that can be taken such as agreeing rent deferrals, reductions and suspensions.



It provides support also for tenants applying for benefits where need be and points to resources available to help develop budgeting plans to ensure that tenants can cover the cost of essential items.

In a joint statement, the National Residential Landlords Association, the Chartered Institute of Housing, The Property Redress Scheme, My Deposits, the Tenancy Deposit Scheme and ARLA Propertymark said: “Covid-19 has posed significant challenges for both tenants and landlords. As a group we are committed to doing everything possible to sustain tenancies both through and beyond this period of crisis.

“The guidance being launched today has an important role to play in achieving this and we encourage all tenants and landlords to work through it together in a spirit of positive co-operation.”

The debt guidance can be accessed here

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    • 03 July 2020 11:11 AM

    No budgeting skills needed.
    Tenants just need to stop being spendthrifts.

    So when they receive their income deduct first their rent.
    Then their water, elect and gas bills monthly.
    Then CTax
    Then Tv licence
    Whatever is remaining is what they have to spend on food.

    Highly unlikely there is any room for feckless spending like on fags, drink or drugs.

    But because tenants are feckless they prioritise these ahead of all the previous others.

    Tenants having problems budgeting is not the problem.
    Feckless spending is!

    • 09 July 2020 11:58 AM

    You are so right.

    How come the Local Authorities do not deduct the amounts they can.ie - Rents, CTax, TV Licence, Electric and Gas.

    It would save them also from having to chase and probably never get what is owing to them too!!!

    I suppose it is so simple for them that they have not even ever thought of it.

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    Guidance for dealing with rent arrears:
    1. Talk to tenants and agree short term repayment plan or accept their request to leave your property before the end of the lease period with the deposit going towards unpaid rent.
    2. Suggest they seek financial support elsewhere as we're neither banks nor charities and tell them you will alert their guarantors shortly if 1 above not satisfactory - or immediately regret not insisting on guarantors.
    3. Give notice that you will get a ccj against them and their guarantors.
    4. Warn them you are considering eviction.
    5. Keep promises made in 3 and 4 above.
    6. Expect to be out of pocket for quite a considerable time.

    • 09 July 2020 12:05 PM

    I have a much simpler idea:

    When any tenant get into arears:

    1. Begin evection processes
    2. Open up a CCJ immediately
    3. Follow it through to the High Court as soon as possible (This will save you at least 3 months being the length that local Bailiffs take to attend an eviction.)

    Job done. Goodbye and good riddance. It is also good with the HC Agents as the tenant has just a week to collect all their belongings BUT a the time discretion of the landlord.

    And when that point arrives, I always leave it to the very last possible date and time so as to inconvenience the evicted tenant to the utmost, especially if it means they cannot get to their favourite Wetherspoon on a Saturday night. That really messes them up. And causes them more cost in transport.

    I love that little one.

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    'As a group we are committed to doing everything possible to sustain tenancies both through and beyond this period of crisis'

    No its time for realism to set in. I say these tenancies shouldn't be sustained. These people need to move out back to their relatives or share with friends. The properties can then go to future tenants that can afford, then everyone is housed. The system is then sustainable!

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    They want Tenant & Landlord to work together which is what we always have done and is fine. A pity Shelter, Government, Local Authorities, laws, Regulators, Generation rent etc, have spent so many years driving a wedge between us.

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    • 03 July 2020 18:29 PM

    I'm more than happy to work with my now vacated rent defaulting tenants.
    Trouble is my former tenants are not prepared to work with me.
    Consequently I am over £9000 out of pocket!!

    Will Govt assist me to work with those absconded rent defaulting tenants!?

    Nope...................thought NOT!!

    I've lost hundreds of thousands of pounds due to rent defaulting tenants.
    Govt has actually deliberately prevented me from achieving recovery of these massive debts.

    There is no point in being an AST LL when faced with Govt sanctioned rent defaulting.

    Which is why I am getting out of AST lettings.

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    Ok I have read this lot but what happens when the power companies and council rates come in for their money? Even worse, after the tenant has vanished and these people think its the landlord's debt.

    I have managed to get an electric company to take ownership of their debt as they had the supply contract but the council are worse than the hounds from hell. They are immoral.

    In these situations you need a non paying tenant out, fast , and a new good tenant in.

    • 04 July 2020 00:19 AM

    Easy to say NOT so easy to achieve.

    The dysfunctional eviction process conspires against any LL when faced with a rent defaulting tenant.

    Knowing what I NOW know about how dysfunctional the eviction process is there is no way I would have invested as I did 10 years ago.
    I should have in fact invested in one very lightly mortgaged house.

    This would have resulted in my being far more financially resilient such that I could cope relatively easily with rent defaulting tenants.

    It is simply impossible for LL to be continue to be subject to all the losses that the State effectively encourages via the dysfunctional eviction process compounded by the current eviction ban.
    It makes no economic sense to maintain multiple mortgaged properties if LL cannot service the mortgage payments on all the properties for at least 1 year.
    This is how long it can take to evict.
    Unfortunately the CV19 crisis has horribly exposed how vulnerable LL are to feckless rent defaulting tenant.

    Many tenants could have savings if they were bothered.
    But they aren't as they know how long it would take to evict them.

    The BTL game has changed.
    The old certainties are GONE!!!

    LL need to adopt a far more defensive strategy if they expect to survive for the future.

    Matthew Payne

    Provided you can demonstrate that the tenant was contractually bound to the tenancy then utility companies should pursue the debt fom the tenant. Yes the council try it on and sometimes suggest a landlord needs to pay the council tax in the absence of the tenant doing so and I have had some entrenched battles with them in the past, until I started sending them tenancy agreements and notices where applicable and they then back down. Only had one last week where a tenant just upped sticks and vanished, and all have accepted that they need to go after the tenant if they want their bills paying.

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    • 07 July 2020 12:06 PM

    @matt payne

    Crikey you were lucky.
    A tenant absconded!

    I wish my 5 wronguns had absconded rather than not paying rent and trashing the properties before I was EVENTUALLY able to evict!!

    In my case average 10 months to evict.
    Of course the ultimate humiliation for mortgaged sole trader LL is they are subject to S24 taxes even with a rent defaulting tenant!!

    Govt still expects S24 taxes to be paid even though the LL has no rent coming in.
    Never mind us LL all have our own magic money tree.
    This must be the case as how else does Govt imagine LL can pay S24 taxes without any rent!!

    I'd say you just managed to swerve a massive bullet.
    Just imagine if your wrongun had stopped paying rent and waited until you evicted.
    I'd say you had a clueless tenant.
    The savvy ones know they can live rent free for at least a year until eventually evicted.

    Of course that will only be the case of the LL is able to service any mortgage costs.
    If not then the lender will repossess pretty quickly evicting tenant as quick.

    The repossessed LL will probably be bankrupted as well.

    I'd say you were very lucky your tenant disappeared.

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    • 07 July 2020 12:30 PM

    We all talk about the issues of the system, so how do we lobby to get the system changed to be fair...?

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    you dont

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    • 07 July 2020 13:24 PM


    As terry states very succinctly

    You don't!!

    The PTB are scheduled to make eviction even more difficult

    Just one of the many reasons I will be selling up.

    It must be apparent to most LL by now that Govt intends to use LL spare assets and capital to subsidise feckless tenants.

    This saves Govt and Councils fortunes.

    No way will Govt make eviction easier.
    They know that this is not electorally damaging as there are more tenant votes than LL ones
    It can therefore hit LL as much as they like with total impunity.

    LL must realise they are on a loser all the time.
    They may well consider it appropriate to amend their business models.
    Rent defaulting is the biggest business risk for LL ESPECIALLY leveraged ones.

    With a completely dysfunctional eviction process LL have an effective dysfunctional business model if letting on an AST.
    This means for many LL that their business isn't really viable.

    I've come so close to bankruptcy myself.
    I don't have a magic money tree to pay mortgages if tenants rent default for whatever reason.

    I am simply not prepared to suffer this level of risk anymore.
    It just isn't worth it.
    I'd far rather have a reduced but more stable income than risk maximisation of my portfolio which could collapse immediately if all tenants stopped paying rent.

    Fortunately my lot were furloughed and they have now returned to work.

    But too close for comfort for me.
    Not prepared to suffer these financial risks anymore.
    I'd rather less but more stable income.
    I'm selling up!


    Hi Paul,
    May I ask whether you used an agency to find you a tenant in the first place? Did they vet them?
    What area are these properties in?

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    no tenants on benefits ever

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    • 09 July 2020 11:55 AM

    Absolutely agree with Terry.
    Not even if the Local Authority pays me directly.

    NO, NO, NO! and NO again!!!!!!

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    • 09 July 2020 12:26 PM

    @irina wood

    Nope I do all my own tenant sourcing.
    Agents are useless.
    Cost me thousands.

    There simply aren't sufficient tenants of quality that can pass RGI checks.
    I am fully exposed to rent defaulting tenants and the dysfunctional eviction process.
    I have no alternative.
    But now have some good occupants though now struggling to let a vacant property.
    I was planning when one became vacant to sell off but then CV19 came along!!

    So this has slowed my hoped for exit from the PRS.
    Effectively I'm trapped into remaining a LL for the time being.

    Rents seem to have reduced and certainly don't reflect S24 costs.
    Such rent levels won't even pay the mortgage.
    As I never remove occupants unless they rent default I'm stuck being a LL until the property occupants choose to vacate.

    My properties are in Bishop's Stortford.

    There is now a reduced market as many properties were taken by cabin crew.
    There are far fewer of them currently!!
    I tend to take on Ryanair.
    Fortunately I had no easyjet!

    But I consider that with declining demand tenants are seeking lower rents.
    That simply isn't viable for me especially because of S24.
    Then add all the other recent costs imposed on the PRS and the business viability is suspect to say the least.
    One 4 bed house with lodgers would make far more business sense for me.
    My risks of wrongun tenants would be gone as lodgers don't have the same tenure rights.
    It is also far easier to source single occupants prepared to rent a room rather than a whole flat

    But personally I'm done with tenants.
    I will be having lodgers only once I have been able to sell up and reinvest in one house.
    I tend to use spareroom; word of mouth and ads on noticeboards.
    Haven't used a LA in over 10 years.

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    I believe that LA vet, credit check etc. thus making sure that the tenant is reliable. Would hat not have worked for you?

    • 09 July 2020 13:23 PM

    Nope LA referencing is useless.
    The only referencing worth doing is that which RGI companies would accept if a claim was submitted.
    Very few LA have referencing that RGI companies accept

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    I didn't realise that not all references are accepted...Which references are accepted?

    • 09 July 2020 13:59 PM

    What you would need to do is contact a RGI company and ascertain what referencing etc would be required in the event of a RGI claim.
    Be aware that what requirements a RGI company has for taking out a policy are less than the requirements for a claim.
    So ensure you comply with both sets of requirements BEFORE you bother paying for a policy.
    Adhering to RGI referencing requirements will give you the best referencing even though a tenant may not qualify.
    The DD that RGI companies require is far superior to the usual rubbish LA referencing

    Matthew Payne

    Hi Irina, you have to check before commiting to a policy ie what referencing may be acceptable and what criteria within that referencing or in addition to, if it is a provider who doesnt also do referencing themselves. Most reputable LAs use a third party referencing agency, in house is not fit for purpose. These companies like FCC Paragon or Van Mildert will have their own RGI policies that they offer off the back of their own references, safe in the knowledge that they are underwriting the risk themselves. Some may accept references from other businesses but not many. Like any industry there are some excellent referencing agencies and some dreadful ones, and likewise some have very stringent criteria that only the very best tenants will pass and others deliberately have less demanding criteria for a pass, as some LAs dont want their deals to fall through. Some LAs dont want tough referencing otherwise they would never write any business as convincing a LL to accept a failed tenant reference is dangerous territory. Insurance providers know all this and will tell you what they want to see.

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    Thanks, guys! It is really helpful... I will be looking for a tenant in a few months...

    • 09 July 2020 15:31 PM

    Be aware that some of the best RGI policies are from DAS.
    They white label their RGI product with lots of LA providers and others.
    DAS policies are good policies but the necessarily stringent criteria means few can qualify.

    Since this CV19 thing it may well be that RGI isn't as effective as it used to be.

    Insurers will naturally be pricing in a future pandemic into their business models and most likely increase pricing or reduce scope of the RGI.

    As with most things and especially in light of the CV19 crisis you need to shop around to obtain the best deal for your circumstances.

    I don't believe you should rely on anything that was stated before CV19 hit.

    Which is why you should really ignore everything I have stated and do your own research.

    So much might have changed.
    I am going by the way things were from years ago.
    That information is probably out of date by now.

    So check with ALL providers
    Have a look on propertytribes as they partner with a few good reference and RGI providers.

    But really anyone who has or has had RGI etc needs to come at this with a clean sheet of paper.
    The providers must have reacted as far as their product offerings are concerned.
    I doubt very much that RGI requirements and conditions are less than they were.

    I suspect they will be far more rigorous and policy conditions not as good as they used to be

    You can't really blame the RGI insurers.

    This CV19 has exposed them to massive claims.
    It is fortunate for them that many idiot LL that could have qualified their tenants for RGI didn't bother.

    So there shouldn't be many RGI claims.
    But many LL will now see the error of their ways and obtain RGI where they can.
    You can't blame insurers from tightening up on referencing criteria and quality.

    Just to give an example of the losses compared to premium income an insurer could suffer.

    For an £89 RGI annual premium it cost them over £10000 to evict etc.
    Best £89 I ever spent.
    Now imagine me multiplied by about a million.
    RGI claims could bankrupt RGI insurers.
    So not unreasonably underwriting criteria will be enhanced!!


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