Rent arrears: How to deal with tenants in arrears
It can be a potentially tricky situation to have a tenant in arrears, but, as a landlord, there are some methods you can legally employ to help recover any money a tenant owes or evict the tenant. The exact procedure will depend on the tenancy agreement and its terms.
What does rent in arrears mean?
This term means that rent has gone unpaid. This can be for an entire month, or an underpayment. The tenancy agreement you set out at the beginning of the tenancy will determine how regularly and how much rent should be paid and being in arrears means that this agreement has been broken.
How can you help manage rent payments?
Rent payments are regulated by your tenancy agreement with the tenant. How much they pay and when will have been agreed. Most tenants will set up a direct debit to their landlord or letting agent to make sure the payments are taken regularly. To manage rent payments and, in particular, manage multiple tenants that all pay rent separately, consider:
- Keeping a record of all payments made
- Send receipts for payments to tenants and keep a copy for your own records
Can you evict a tenant for not paying rent?
If a tenant fails to pay rent, there a few options for landlords. If you are using an agent to manage the property, they can help you to contact the tenant to secure the money. If you are a private landlord you can begin the process of getting the rent yourself, but you must do so legally.
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How should a landlord request rent arrears be settled?
Contact your tenant
Begin by contacting your tenant. There could be a genuine mistake or technical issue that has affected a delay in rent. If however this is not the case, you can write a formal letter to ask for the rent to be paid in full, plus a reminder of the terms set out in the tenancy agreement.
Contact the guarantor
If your tenant provided a guarantor, and especially if you have not heard from your tenant after writing to them or calling them, contact them too. Make sure you clearly state that the tenancy agreement terms have been broken.
Serve a Section 8 notice
If, after contacting your tenant, there has been no payment made by their guarantor (if applicable), you can serve a Section 8 notice. Essentially, this informs your tenant that you intend to take them to court if they don't pay within a further 14 days from your final written communication with them.
A Section 8 notice comes in different forms depending on the type of tenancy agreement you have in place, so be sure that you are filling out the correct version of the form. The grounds for serving a Section 8 eviction order are set out in Schedule 2 of the Housing Act 1988 and one of the most common reasons for evicting a tenant is in fact rent arrears.
You must specify which terms of the tenancy have been broken – in this case, the rent going unpaid or being paid late and the tenants will have between 2 weeks’ and 2 months’ notice to move out of the property depending on the terms set out in your original tenancy agreement.
At haart, we can help landlords with every aspect of renting, from finding you the right type of tenant for your property to helping you manage multiple properties in your portfolio.
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