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Help/Advice Needed - Tenant wanting break agreement!
stevekoz
Posts: 15 Forumite
Hi,
First of all i'd like to advise we aren't the normal landlords. Our property is rented out only as our family grew, we were in negative equity and couldn't afford to buy a new property as we had £30,000 debt, we only have 4 years of that debt left to pay now and by 2015 we'll be debt free bar the mortgage. But rather than lose the house we rented it out to cover the cost of the mortgage and to use the balance of the rent to cover part of the rent on a large family home, so we aren't in this for profit or a business but to keep our heads above water. So please don't judge on that basis, i've posted befoer as a landlord and get a torrent of abuse say im this and that and only in it for the money. If only that were true!!
Last week our tenant advised that due to redundancy of his partner (joint tenant) from his family firm they'd be no longer in a position to remain in the agreement and requested to leave the property.
To note, they advised straight away no proof of redundancy was possible - funny given its his dads business she's got the boot from. Soemthing just didn't feel right.
Did some digging for advice and we submitted them an agreement as follows -
Scenario 1
i. You will remain liable (for rent,utilities etc.) whilst the property remains vacant, until such time a new tenant/s are able to take over the rental of the property. *(This may be a week or up to and including the end of the fixed term as documented in your original Assured Shorthold Tenancy.)
ii. You will forfeit your deposit paid on the original Tenancy Agreement in respect to the property being made vacant before the completion of your Assured Shorthold Tenancy.
iii. You will be fully liable for the re-letting cost associated with finding any such new tenant, including but not limited too Agency fees, Advertising costs/Marketing etc.
iv. The property will be made available immediately either to the Landlords or to the Agents instructed, for any such viewing necessary, in adherence with the first two points. As a reminder, please keep the property clean & tidy at all times should it be necessary to show any such proposed tenants round
v. Any monies remaining unpaid following your vacation from the property pursuant to your original tenancy (rent, utilities, fees stipulated above etc.) will be passed to relevant debt collection agency with the Tenants liable for the 15% collection fee.
vi. Only upon agreement of points 1-5 will an suitable Surrender of Tenancy be drawn up for both parties to sign to say they understand and will adhere to the Terms and Conditions set out herein.
Scenario 2
A lump sum will be paid to the amount of £1425 to release you from your contractual obligations as of the 30th June as requested. This amount will include the following;
i. You will remain liable for rent till the 30th June 2011 – payable on or around the 27th of the month before, as stipulated by your original Tenancy Agreement.
ii. You will forfeit your deposit paid on the original Tenancy Agreement in respect to the property being vacant.
iii. A further 1 months rent payment £475 (Four Hundred and Seventy Five) will be made on or before the 30th June 2011 in final payment in lieu of the original tenancy, and to release you from your contractual obligations barring those set out herein.
iv. Any such utility, council tax bill etc, received following the relinquishment of the Tenancy but in relation to the term of your Tenancy (30th January 2010 - 30th June 2011) will be forwarded to a relevant contact address for subsequent payment, else be forwarded to a Debt Collection Agency pursuant to the terms laid out in point iv set out in Scenario 1.
v. Following a satisfactory and full inspection of the property and its contents, the keys will be relinquished to the Landlord and the contractual obligations of the Tenancy will be dissolved.
vi. Only upon agreement of points 1-5 will a suitable Surrender of Tenancy be drawn up for both parties to sign to say they understand and will adhere to the Terms and Conditions set out herein.
there response was as follows -
As agreed, we shall continue to pay all rent outstanding until the 30th June (£475) and all utility bills until that date.
>
> Secondly we shall pay for all fees incurred due to the re-let of the property in question up to a maximum of (£475). This amount being taken from the holding deposit Which was paid at the start of the tenancy and will be paid only once the deposit has been gained by ourselves. If however a new tenant is not found by the 30th of June then we shall forfeit the whole deposit (£475) to yourselves. This will not be paid if a new tenant is in the process of signing a contract for the property in question but has not completed said contract by the 30th June.
>
> If the whole deposit is forfeited to yourselves and no tenant is occupying the property, we will accept no utility bills or council tax or further marketing fees owed after the 30th June.
>
> If however a tenant is found prior to the 30th June and they wish to move in earlier, we shall pay rent until the 30th June (£475) and end all utility bills from the date we vacate the property and that will be all we would pay to yourselves, with us keeping all of the deposit.
lease do not hesitate to contact me via email as we are away this weekend and would like to sort this before your first viewing on Monday 23rd may"
I'm now not only a bit angry but unsure of how to take further steps. Surely they have a legal obligation here and it doesn't seem to be sinking in...secondly, i think our offers were fair, one months rent to live there, one months rent in compensation for relet fees etc and the forfeit of deposit. All open to negotiation.
As it stands tehy propose we pay them back their deposit and then they forfeit it if we can't find new tenatns - how can i guarantee this? Secondly no further commitment financially in lieu of the agreement, leaves us otu of pocket and not compensated. I don't know what to do next and can't afford legal advice. Anyone able to offer any useful help and guidance??
First of all i'd like to advise we aren't the normal landlords. Our property is rented out only as our family grew, we were in negative equity and couldn't afford to buy a new property as we had £30,000 debt, we only have 4 years of that debt left to pay now and by 2015 we'll be debt free bar the mortgage. But rather than lose the house we rented it out to cover the cost of the mortgage and to use the balance of the rent to cover part of the rent on a large family home, so we aren't in this for profit or a business but to keep our heads above water. So please don't judge on that basis, i've posted befoer as a landlord and get a torrent of abuse say im this and that and only in it for the money. If only that were true!!
Last week our tenant advised that due to redundancy of his partner (joint tenant) from his family firm they'd be no longer in a position to remain in the agreement and requested to leave the property.
To note, they advised straight away no proof of redundancy was possible - funny given its his dads business she's got the boot from. Soemthing just didn't feel right.
Did some digging for advice and we submitted them an agreement as follows -
Scenario 1
i. You will remain liable (for rent,utilities etc.) whilst the property remains vacant, until such time a new tenant/s are able to take over the rental of the property. *(This may be a week or up to and including the end of the fixed term as documented in your original Assured Shorthold Tenancy.)
ii. You will forfeit your deposit paid on the original Tenancy Agreement in respect to the property being made vacant before the completion of your Assured Shorthold Tenancy.
iii. You will be fully liable for the re-letting cost associated with finding any such new tenant, including but not limited too Agency fees, Advertising costs/Marketing etc.
iv. The property will be made available immediately either to the Landlords or to the Agents instructed, for any such viewing necessary, in adherence with the first two points. As a reminder, please keep the property clean & tidy at all times should it be necessary to show any such proposed tenants round
v. Any monies remaining unpaid following your vacation from the property pursuant to your original tenancy (rent, utilities, fees stipulated above etc.) will be passed to relevant debt collection agency with the Tenants liable for the 15% collection fee.
vi. Only upon agreement of points 1-5 will an suitable Surrender of Tenancy be drawn up for both parties to sign to say they understand and will adhere to the Terms and Conditions set out herein.
Scenario 2
A lump sum will be paid to the amount of £1425 to release you from your contractual obligations as of the 30th June as requested. This amount will include the following;
i. You will remain liable for rent till the 30th June 2011 – payable on or around the 27th of the month before, as stipulated by your original Tenancy Agreement.
ii. You will forfeit your deposit paid on the original Tenancy Agreement in respect to the property being vacant.
iii. A further 1 months rent payment £475 (Four Hundred and Seventy Five) will be made on or before the 30th June 2011 in final payment in lieu of the original tenancy, and to release you from your contractual obligations barring those set out herein.
iv. Any such utility, council tax bill etc, received following the relinquishment of the Tenancy but in relation to the term of your Tenancy (30th January 2010 - 30th June 2011) will be forwarded to a relevant contact address for subsequent payment, else be forwarded to a Debt Collection Agency pursuant to the terms laid out in point iv set out in Scenario 1.
v. Following a satisfactory and full inspection of the property and its contents, the keys will be relinquished to the Landlord and the contractual obligations of the Tenancy will be dissolved.
vi. Only upon agreement of points 1-5 will a suitable Surrender of Tenancy be drawn up for both parties to sign to say they understand and will adhere to the Terms and Conditions set out herein.
there response was as follows -
As agreed, we shall continue to pay all rent outstanding until the 30th June (£475) and all utility bills until that date.
>
> Secondly we shall pay for all fees incurred due to the re-let of the property in question up to a maximum of (£475). This amount being taken from the holding deposit Which was paid at the start of the tenancy and will be paid only once the deposit has been gained by ourselves. If however a new tenant is not found by the 30th of June then we shall forfeit the whole deposit (£475) to yourselves. This will not be paid if a new tenant is in the process of signing a contract for the property in question but has not completed said contract by the 30th June.
>
> If the whole deposit is forfeited to yourselves and no tenant is occupying the property, we will accept no utility bills or council tax or further marketing fees owed after the 30th June.
>
> If however a tenant is found prior to the 30th June and they wish to move in earlier, we shall pay rent until the 30th June (£475) and end all utility bills from the date we vacate the property and that will be all we would pay to yourselves, with us keeping all of the deposit.
lease do not hesitate to contact me via email as we are away this weekend and would like to sort this before your first viewing on Monday 23rd may"
I'm now not only a bit angry but unsure of how to take further steps. Surely they have a legal obligation here and it doesn't seem to be sinking in...secondly, i think our offers were fair, one months rent to live there, one months rent in compensation for relet fees etc and the forfeit of deposit. All open to negotiation.
As it stands tehy propose we pay them back their deposit and then they forfeit it if we can't find new tenatns - how can i guarantee this? Secondly no further commitment financially in lieu of the agreement, leaves us otu of pocket and not compensated. I don't know what to do next and can't afford legal advice. Anyone able to offer any useful help and guidance??
0
Comments
-
I would say tenant liable for any genuine relet costs plus rent up to the point new tenant takes over.
Don't know why the T should forfiet deposit aswell unless there is damage to the propery.0 -
I agree, I don't understand why the tenant should forfeit the deposit - it's for damage caused etc not just to make you feel better for them leaving early.0
-
Which country are you in, England, Scotland or Wales?If you've have not made a mistake, you've made nothing0
-
[Assuming AST in England or Wales]
Your scenario 1 is not fair in that it explicitly allows for the tenant to be liable for the rent of the full fixed term in addition to forfeit the deposit and pay re-letting cost. That'd make it more expensive that there current obligations.
In my view a fair and reasonable deal for scenario 1 should be that they are liable for the minimum of the 2 amounts below:
1. the remaining rent until the fixed term expires
2. the rent until a new tenant moves in + any extra you may wish to add.
Also I don't see the point of item (v). If they leave debts behind sue via money claim.
When will the fixed term expire?I'm now not only a bit angry but unsure of how to take further steps. Surely they have a legal obligation here and it doesn't seem to be sinking in...secondly, i think our offers were fair, one months rent to live there, one months rent in compensation for relet fees etc and the forfeit of deposit. All open to negotiation
If it's open to negotiation you should not complain that they do try to negotiate
I agree, I don't understand why the tenant should forfeit the deposit - it's for damage caused etc not just to make you feel better for them leaving early.
Tenant is liable for the full fixed term and thus landlord may ask whatever he wishes in order to bring the contract to end end earlier than that.0 -
I'm now not only a bit angry but unsure of how to take further steps. Surely they have a legal obligation here and it doesn't seem to be sinking in...secondly, i think our offers were fair, one months rent to live there, one months rent in compensation for relet fees etc and the forfeit of deposit. All open to negotiation.
I'm assuming this is an assured shorthold tenancy in England/Wales, and the T wishes to end the contract before expiry of the fixed term.
This being the case, the bottom line legal position is that T is liable for rent up to expiry of the fixed term. As LL, you have no obligation whatsoever to agree an early surrender (which is what the T is offering).
In addition, rent is a debt and you have no obligation to mitigate a debt (e.g. by trying to find a replacement tenant).
Therefore, the T is in no position to dictate terms. And you may demand whatever terms you wish in exchange for agreeing an early surrender. If T refuses your offer, you simply say that you will treat the tenancy as continuing, and intend to pursue him for rent for the remainder of the fixed term (BTW, how many months left to run on the fixed term?) and he will remain liable for utility bills and council tax as per the terms of the contract.
So let's say that is what happens. The T moves out without you and he having reached any agreement. If you do acts which are inconsistent with the tenancy continuing - the obvious one being reletting the property - then at that point there will be a surrender by operation of law and the current tenancy will end, together with T's liability for rent. If you do precisely nothing, and treat the tenancy as continuing, the tenancy and the T's liability will continue until expiry of the fixed term.0 -
Agreed.jjlandlord wrote: »[Assuming AST in England or Wales]
Your scenario 1 is not fair in that it explicitly allows for the tenant to be liable for the rent of the full fixed term in addition to forfeit the deposit and pay re-letting cost. That'd make it more expensive that there current obligations.
Depending on the length of the unexpired term, I would probably demand two months rent plus reletting/legal fees in exchange for agreeing an early surrender (as opposed to the vagueness of until-a- new-tenancy-begins). It's a slight gamble but possibly more attractive an offer from T's POV (and it's preferable to reach a firm agreement), and if I were to relet sooner than two months, then it's particularly advantageous.
If T refused the terms on offer, I would treat the tenancy as continuing and pursue T for rent for the remainder of the fixed term (as it falls due).0 -
P.S. Do not refund the deposit before the tenancy ends.As it stands tehy propose we pay them back their deposit
And if you do negotiate mutually acceptable terms of a surrender, formalize it in a Deed of Surrender (which will need to be drafted by a landlord & tenant solicitor - T can pay the cost of this).0 -
In respect to the deposit. Yes. I feel it is certainly within our rights to request it be forfeited. A proportion will be kept for cleaning etc and any repairs found to be needed prior to the relinquishment of the keys. I already know the door frame has been damaged and im sure there is other such damage around,t here is bound to be after 2 years of tenancy. So to request 100% of it , the remainder in compensation i don't think is unfair.
I could threaten legal action but unfortuntely financially im in a limited position, i could not afford to go to court and pay fees without a guarantee i wouldn't be out of pocked afterwards, as stated before, this isn't my business this is a way of just about keeping my head afloat while my property returns to positive equity. If i end up out of pocket then it would see us seriously struggle to meet our own Tenancy and Mortgage obligations.
The Tenancy began 1st February 2011 for a 12 month term.
Your right i shouldn't be angry. But i know his tone and his nature and i think i let that get to me slightly, negotiations go both ways, your right. Hence for my request for help and advice.0 -
Personally I'd find your offer inflamatory. I'd be really annoyed at having to loose my deposit and your attitude of having them having to pay 15% if their utilities are in arrears as well would really get my back up.
As it stands they seem quite happy to come to a compromise with you and agree to loose some of the deposit.
Not sure what the problem is - as you know unless between you you can come to some sort of agreement then they are liable for all the rent as contractually agreed - no idea why you are getting upset about it as you have the upper hand. They appear to want to negotiate
.
How long a term did they sign for and how long have they got left? How easy or otherwise do you feel it will be for you to find a new tenant?
Have they caused any other problems or are you worried about them causing other problems - ie with damaging the house or something?
dfMaking my money go further with MSE :j
How much can I save in 2012 challenge
75/1200 :eek:0 -
Agreed.
Depending on the length of the unexpired term, I would probably demand two months rent plus reletting/legal fees in exchange for agreeing an early surrender (as opposed to the vagueness of until-a- new-tenancy-begins). It's a slight gamble but possibly more attractive an offer from T's POV (and it's preferable to reach a firm agreement), and if I were to relet sooner than two months, then it's particularly advantageous.
If T refused the terms on offer, I would treat the tenancy as continuing and pursue T for rent for the remainder of the fixed term (as it falls due).
I think what we meant perhaps wasn't written out properly - that is my fault, i had no help didn't think it was that bad to be honest, but. yes. unfair.
So you would propose the following as my understanding goes -
2 x months rent = 950
Agency Fee for relet - £432
they keep their deposit minus any damage/cleaning etc as per norm?
Its only very slighly less than the original scenario 2 offered before and they are unlikely to pay it. Which i think will leave me in a "cut my loss or take to court" scenario.0
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