It’s important to be able to offer advice on how to manage rent arrears for all involved. Rent arrears remain a significant issue for landlords and tenants.

The extent of the problem was analysed by the National Residential Landlord Association (NRLA) earlier this year suggesting 840,000 private tenants may have built up arrears since the pandemic started.

A report was published in May 2021 estimating over 400,000 private tenants may still be in significant rent arrears by the end of the year. The Government projection is unemployment may rise to 6.5% impacting the tenant’s ability to pay the rent.

Landlord’s are facing difficult circumstances and tenant’s are facing significant challenges.  

In order to assist Landlord’s managing rent arrears or uncooperative tenants, we do the following:

1. Maintain a comprehensive record of payments

It’s vital to keep detailed records of rent payments to keep on top of any arrears.  If a joint tenancy agreement, Tenant’s should be reminded they all share equal responsibility for payments and any debts are owned collectively.

2. Good communication

It’s also important to maintain contact with the tenants.  Having a good relationship with the tenant throughout the tenancy could help prompt payments. A good relationship also makes it easier for them to discuss any issues they are facing or clearing up a genuine mistake.  A simple reminder of the terms of the tenancy agreement, a call or text may encourage them to pay arrears before commencing further action.  

3. Discounts

Tenant’s may not be aware, they can sometimes apply for a Discretionary Housing Payment (DHP).  The Government made £140M available in DHP funding, for local authorities in England and Wales to distribute to support vulnerable people with housing costs.  Tenants should be notified and encouraged to apply to their local council.

4. Contact the Guarantor

The Guarantor should be made aware of the issues with rent arrears and reminded they must also meet their obligations of the Tenancy Agreement which includes paying rent and arrears.

5. Start possession claim through delivering a Section 8

If all else fails, and a repayment agreement can’t be agreed, it may become necessary to reclaim possession of the property. For arrears, we use Section 8 of The Housing Act 1988 to limit the extent of the arrears if all other avenues have failed.  From 1st August 2021, the minimum notice period for tenants with arrears is 2 months notice.

6. Court proceedings

This final option, a Landlord can take the tenants to court, when in significant arrears to repossess or ask the court to make a money judgement on the arrears and reasonable costs incurred. Worth noting, however, any money judgement is ineffective if the tenants cannot pay, meaning some Landlord’s take the option of getting a CCJ and their property back and move on.

Here at PIIM, we will always advise and take overall instruction from the Client on how they want to proceed.  We remain professional and will try to gain repayment agreements with the Tenant’s and this generally works well given out close relationship with them.

If you are having issues with rent arrears, need advice or someone to step in, get in touch here.