Rent arrears

debbieobrien50

Hello

I am new to the forum and seeking advice on an issue we have with a tenant.
The tenant moved in March 2008 and paid two months rent in advance.
The two months rent in advance being payment for the first months rent and the other payment for the last month rent when the tenant eventually moves out of the property.
The rent has been continuously late but paid, but the last two months we
have been experiencing problems. He has asked us the use the months rent we are holding to pay last months rent and this months rent was due on the 20th November.
Can someone please let me know if we still have to give this tenant any notice to leave our property. Do we need to issue Notice 8 (not really sure what this means) so much conflicting information out there; not sure of the right route!

N79

debbieobrien50 wrote: »

so much conflicting information out there; not sure of the right route!

Then avoid the conflicting information and read

http://www.statutelaw.gov.uk/legResults.aspx?LegType=All+Legislation&title=housing+act+1988&searchEnacted=0&extentMatchOnly=0&confersPower=0&blanketAmendment=0&TYPE=QS&NavFrom=0&activeTextDocId=2128236&PageNumber=1&SortAlpha=0

Also bear in mind that you are in breach of the deposit regulations which you can read here

http://www.opsi.gov.uk/Acts/acts2004/pdf/ukpga_20040034_en.pdf

subsection 213 and following.

Being honest you need to get professional help and to actually learn what it takes to be a LL. This T has seen you coming. You can not even use the normal S21 eviction route.

1. Join a LL association. Either

www.landlords.org.uk - the national landlords association

or www.rla.org.uk - the residential landlords association.

2. Read the housing acts and understand them.

3. Buy a good book.

4. Use the associations helplines.

Just as an aside, do you have a valid gas safety certificate for the property?

As for a S8 notice to use G8 you need 2 months rent unpaid. The mess you are in over the Ts deposit is going to make this more complicated than it needs to be. Don't rely on G10 or G11 for eviction - they rarely work.

Have a general read and then post back any specific Qs and we will be happy to help.

Jowo_2

It is hard to circumvent the landlord's legal requirement in England and Wales to lodge a deposit in a tenancy deposit scheme by charging rent in advance, quite a grey and risky area. Take advice from the landlordzone forum on this as they have housing solictors as members. You don't want to risk being taken to court and ordered to pay x3 the sum of the deposit to the tenant as a penalty.

Did the tenant give you his notice in writing?

A section 8 is used by landlords to take a tenant to court who owes 2 months rent at the time of serving it (if rent is paid monthly) because if the continue to owe arrears of the same or greater sum, the judge must award possession back to the landlord (there's no discretion).

A section 21 is 2 months notice given by the landlord to the tenant and is known as a 'no fault' notice - if served correctly, a judge will also award possession back to the landlord (but many landlords complete it incorrectly and the case gets thrown out of court). A landlord cannot serve this if the deposit should have been, but was not, lodged in TDS.

N79

Jowo - a secition 8 notice is used not just for taking Ts to court that owe 2 months rent but also for a host of other things unrelated to rent (not all are relevent to a standard residential AST). Hence the term issuing a S8 notice is slightly misleading to the amateur LL as it is very important that they specify the correct grounds that they intend to rely on - normally S8, S10 and S11 if the precondictions have been met.

For anyone, including the OP, reading this then the grounds and their requirements can be found as schedule 2 of the 1988 Housing Act, a link to which I posted in my above post (in its modified form).

Jowo_2

Thanks, N79, re the section 8.

To clarify, some of the grounds that landlords can cite on this are discretionary and many of the mandatory grounds are unlikely to apply to a private landlord. A judge presented with discretionary grounds, such as late payment, is less likely to award possession to the landlord compared to the most-used mandatory ground of owing 2 months rent.

Full grounds here

http://www.landlordzone.co.uk/grounds_for_possession.htm

tbs624

N79's post gives good info/suggestions.

However, whilst I agree ( & frequently suggest) that all newbie LLs get signed up to a national LL association or to Tessa's LL Law site, the RLA are of course responsible for a muddying of the waters on this "rent in advance" malarkey, in an effort to circumvent Tenancy Deposit Regs, and have had to post up what amounts to a backtracking on the issue. ( the deposit reg stuff is of course irrelevant if the OPs property is in Scotland)

"It may well be the case in time that the position is clarified in favour of the landlord. We are however, issuing a strong warning to landlords about the problems which could be encountered by you. Our advice therefore is not to take an advance payment of rent from the tenant because of the potential uncertainty and problems you might face."

Source :http://www.rla.org.uk/landlord/tenancy_deposits/tds-Alternatives.shtml

I think in the OPs circumstances, depending on what was formally agreed at the start of this tenancy, I would be tempted to

(a) register that "advance rent" for the tenancy's final month within a scheme and make sure that the T was given the relevant scheme's info pronto.

Then issue a S21 notice, give him a rent statement and ask him to bring his rent payments up to date within 7 working days and take it from there, serving a S8, Gr 8, 10 & 11 when appropriate.

Am assuming that you have signed this T up for a 12 months Fixed Term, rather than an initial 6 months Fixed Term which has since become a periodic agreement?

Hindsight is of course a wonderful thing but if you try to take short cuts to get round legal obligations, it does have a nasty habit of backfiring - experienced T "in the know", realises that LL isn't and can be given the run around.

N79

TBS - I agree that the RLA's super macho tough guy we will evade the spirit (and letter - oops!) of the law approach to deposits has landed them with egg on their faces but it remains the case that 99% of what either association has to offer would be extremely relevent to all new and most experienced LL.

I will illustrate this from my personal position. I retain membership of an association not because I need the advice line but because they are quick to inform me of changes to the legislative environment and, by providing a network of contacts great for keeping up with local gossip and market conditions (not to mention finding out about the odd professional T to avoid). Even though I have many properties I am not a big landlord and can not really do this "in house".

As a non resident this service is doubly helpful and far cheaper than paying my solicitor (who is a Land Law specialist but even so tends not to be as quick of the mark as the associates with all the changes).

As for the OPs case, if the OP follows your advice then the OP can only now register the rent by confirming that it was, in fact, a deposit.

This could open the case to a 3 x claim. However, if the status of the money is unclear another option would be to slip all the rent due dates by a month by taking this payment as the rent for month 2 and then calculating the statement of rent from there. This would delay a S8G8 by a month but would remove, depending on what was agreed in writing at the start, the threat of a 3x penalty.

Either way has their difficulties and I'm not saying that either is right and alot will depend on the shape of the pre tenancy paperwork but I thought I should post the opposing view.

tbs624

Thanks for your response N79

I'm not saying that the fact that the RLA looks to have got this one wrong negates all the other information/support available ( as I say, I frequently post that joining a national LL association can be a useful thing to do as a newbie LL). The point was more that it's not surprising that people get themselves in a pickle with the regs & rules when even those whom you would think would have a handle on the topic don't appear to have.

We have, of course, both garnished our respective suggestions with "depending on what was formally agreed at the start of this tenancy" in my case, and "alot will depend on the shape of the pre tenancy paperwork", in your own.

None of our posts constitute "advice" as such and posters should seek professional clarification of anything that any of us post on here before acting.

clutton_2

you are in breach of the deposit regulations - i do not agree

monies taken at the beginning of the tenancy which are specifically for rent - surely are not classified as "deposit" monies.....

deposit monies are specifically for unpaid rent and dilapidations

if the OP's AST specifies exactly what these sums are for - ie £x for rent from x date to x date and £x for rent from x date to x date - then i cannot see that the deposit regs apply

theartfullodger

Get on an introductory "How to be a Landlord" course - both NLA & RLA run them, worth the money..

Read this board & also Landlordzone and learn...

I'm sure you realise you need to treat your tenant and his home (his home, your investment) with respect, care and due legal caution...

Cheers!

Lodger

tbs624

clutton wrote: »

you are in breach of the deposit regulations - i do not agree

monies taken at the beginning of the tenancy which are specifically for rent - surely are not classified as "deposit" monies.....

deposit monies are specifically for unpaid rent and dilapidations

if the OP's AST specifies exactly what these sums are for - ie £x for rent from x date to x date and £x for rent from x date to x date - then i cannot see that the deposit regs apply

Read the link I gave to the RLA page on the issue of Advance Rent payments. You may change your mind. It would be nice to have some test cases through the courts.