Most common legal questions for landlords
Whether you are already renting a property or at the stage of considering it, we have compiled a list of the most common legal questions to consider.
Do I need a tenancy agreement if I know the tenant?
Many people think that if they are renting to someone that they know then a tenancy agreement isn’t necessary. However without an agreement in place stating the term of the tenancy, the financial commitments and the expectations of both parties, there is scope to get into a dispute that can prove tricky to navigate. Having an agreement in place also ensures that you are able to give notice to leave and should an eviction be necessary, that you are fully covered to follow the appropriate legal proceedings. A good tenancy agreement will avoid disputes in the future and ensure that everyone involved knows what their roles are.
So, even if you know your tenants, be sure to have an agreement in place before they move in.
What is covered in a tenancy agreement?
An Assured Shorthand Tenancies agreement (AST) outlines the term of the tenancy – either fixed term or on a rolling tenancy basis and on what date the tenant should pay rent. It outlines the roles and responsibilities of the landlord and tenant and the expectations placed on both parties (such as checks on the property, who is responsible for maintenance etc). Having an AST in place also enables the landlord to give 2 months notice to tenants by issuing a Section 21 notice.
(NB: Notice periods are currently 4 months in England due to the Coronavirus pandemic, however this is due to return to the pre-pandemic notice periods later in the year.)
I’m worried that I will be out of pocket if my tenants refuse to pay. What can I do in this situation?
The first thing to do is talk with the tenant and try to find out what has happened – particularly if they have been living in the property without problems for some time. They may have fallen on hard times and need to set up a plan to pay back the arrears, in which case you may be able to keep a good tenant for many years into the future. If the tenant claims that a payment has gone through, be sure to check your bank account and ask for proof from them that the payment has left their account. You should keep a log of these conversations and put into writing for the tenant whatever has been agreed. If you have reached agreement on a payment plan for arrears, this should be put into writing and signed by both tenant and landlord.
If this fails to reach a satisfactory conclusion, you should send a letter to the tenant stating that they have 7 days to pay or you will start eviction proceedings.
How long is the eviction process?
This can differ defending on the circumstances, however an average is around 6 weeks. Depending on the type of tenancy the landlord has, they can be issued with a section 21 notice at the end of a fixed term tenancy, or a section 8 notice if they have broken the rules of their tenancy. The appropriate eviction process is vital to be adhered to correctly and so legal advice to evict tenants is strongly recommended.
What should I do with the tenants deposit?
All deposits must be put into a TDP within 30 days of receiving them. This is a government backed tenancy deposit scheme aimed to protect both parties. Details of available schemes can be found here.
Do I need to tell my mortgage lender I am renting the property?
Unless you have purchased the property with a buy to let mortgage, you will need to let your mortgage company know that you are now renting the property. Failure to do so is classed as fraud and so full disclosure is vital. You will also need to ensure that you check your insurance policy and inform them of the change to ensure that your property is covered.
What can I do if I find myself in a dispute with tenants?
The best way to avoid disputes with tenants is to ensure that your tenancy agreement is comprehensive and lays out all expectations on both parties. However, should a dispute arise you should try to discuss these with the tenant and keep a record of the conversations you have had. We recommend mediation to help settle disputes as this impartial service allows both parties to be heard and reach an amicable conclusion. Most disputes can be solved without the need for court, however should you need more legal support we are able to assist with your needs.
Can I refuse to let to someone because they claim benefits?
Refusal to rent to anyone in receipt of benefits has recently been challenged in courts as discriminatory against some potential tenants (for example those claiming disability benefits). Whilst it isn’t illegal to state that you do not wish applicants to be in receipt of benefits, it is recommended that you assess your tenants on a case by case basis rather than issuing a blanket ban. You are able to carry out affordability checks if necessary which may give you greater peace of mind that your tenant is able to meet the monthly payments effectively.
If you want to discuss your unique circumstances or if you need legal advice on any aspect of property letting, get in touch with our team today and we will be able to help.