Can I get Insurance For My 6 month ADVANCE RENT PAYMENT

Anon_John

My circumstances (at present) mean that the only way I can get a flat to rent is to pay at least 6 months downpayment towards future rent. This is no problem to me because my savings are sufficient. However, I cannot afford the risk of losing say £6000 on the occasion that the landlord loses his property to his lender.

As there is absolutely no 100% way of knowing if the Landlord has permission to let or not, my downpayment could be at risk. I know this may be a rare risk, but I just want the peace of mind to know that my money is safe (especially as £6000 is a lot of money to risk. Does anybody know of a Company or organisation which would provide insurance cover for my downpayment?

I look forward to your reply.
Thanks

sooz

Anon_John wrote: »

As there is absolutely no 100% way of knowing if the Landlord has permission to let or not, my downpayment could be at risk

Find a landlord with no mortgage?

jjlandlord

Anon_John wrote: »

As there is absolutely no 100% way of knowing if the Landlord has permission to let or not

Ask your prospective landlord to show the written permission to you. If he refuses you'll have your answer...

Anon_John

Thanks for your contribution, but I am trying to ascertain how I can get insurance cover. I already know about the point you made. Does anybody have an answer to my question?

G_M

I have never come across such insurance. Ask an insurance broker but don't hold your breath.

I would follow up the suggestions above as protection.

Also check that the letter/document the LL gives you from his lender confirming CTL is actually the same lender as is listed on the Charges register for the property. If he shows you a letter from Natwest but the LR shows a charge in the name of HSBC... you have a problem!

jjlandlord

Anon_John wrote: »

Thanks for your contribution, but I am trying to ascertain how I can get insurance cover. I already know about the point you made. Does anybody have an answer to my question?

You're very welcome. Good luck.

Anon_John

sooz wrote: »

Find a landlord with no mortgage?

How do I find such a LL if I am using a letting agent? Isn't it much safer to find a LL through an agency rather than a LL advertising on say Gumtree. My experience of using Gumtree is that there are a lot of rogue or pretend LL's using it.

If I approach a LL direct, how can I be sure that I can trust them. Even if they can be trusted, they may decide to give the property to someone else rather than spend time getting the written permission from the Lender. I want someone I can trust who can prove this to me but do not want to lose out by putting them off me. What should I do?

Anon_John

G_M wrote: »

I have never come across such insurance. Ask an insurance broker but don't hold your breath.

I would follow up the suggestions above as protection.

Also check that the letter/document the LL gives you from his lender confirming CTL is actually the same lender as is listed on the Charges register for the property. If he shows you a letter from Natwest but the LR shows a charge in the name of HSBC... you have a problem!

Thanks G_M
I believe it is safer to use an agency. Surely the agency will not entertain me if I ask them to get me a permission letter from the LL? Even if they did obtain one it would take too long to get it. Agency's are keen to let out asap, so if another tenant (after me) is "easier" they may give that property away before I get the LL letter.

Obviously I cannot secure the property without a holding deposit. I will not give a holding deposit until I obtain the letter. Seems a catch 22 situation?

tyllwyd

I think you might be worrying a bit too much - the time scale is only six months, and your initial £6000 will be decreasing to zero over that time. If you move in, even if the worst happens I think (may be wrong!) you'd be entitled to stay for your whole six-month contract - or it will take a few months for everything to go through before they could get you out, so realistically you wouldn't be risking more than a month or two's rent.

jjlandlord

You seem to be looking for an insurance to protect you against your landlord basically going bust: Whether they have permission from lender or not should not impact the rent you paid in advance, what would is their capacity to pay it back to you in case the property is unexpectedly repossessed.

tbs624

Anon_John wrote: »

I believe it is safer to use an agency.

Why do you believe it is "safer" to use an LA? Anyone - absolutely anyone- can set themselves up in business as an LA, dealing with thousands of ££'s worth of other folks money and property. No formal training, qualification, expertise or indeed commom sense is required before opening up your LA shop/office.

You can find private LLs who self-manage their properties by going via the local or national LL associations. Some Councils run schemes to accredit PRS LLs so it may be worth asking whether they hold a list.

I have not heard of any insurance policies of the type you suggest - as G_M says, ask a broker for guidance. It may be worth you emailing the National LL Association too.

Your thread header is misleading btw - "Can I get Insurance For My 6 month deposit" - it would not be a "deposit" ( which would need to be scheme registered if property is in Eng/Wales) but an "advance rent payment"