Tenant refusing to pay last month's rent. Update: sublets & retaining deposit

tygr

Hi

I let my property myself for the first time last year and everything has gone very well, until now. I know many people on this board say never do anything without agents but I did thorough research before I started, have experience of commercial property management and think the last year has vindicated my decision. However, I would appreciate some advice from anyone with experience of deposit schemes and tenants refusing to pay the last month's rent to make sure I have all the bases covered in my current situation.

The tenants are foreign students and the lead tenant's visa expires the day after the tenancy (don't think this is relevant to the issue per se but explains why they are acting as they are). As a result, they initially asked to leave a few weeks early as he is returning to his home country. I agreed that if I could find a new tenant, then they could leave early and I would repay the rent for the overlapping period but I stated that they needed to pay for the full month up front as per the lease.

6 weeks' rent is being held in a deposit protection scheme.

The last month's rent was due on 9th October. On 10th October, I received an email from the lead tenant to say that they do not have enough money to pay the last month's rent and that I should take it out of the deposit.

I have emailed back to state that this is not the purpose of the deposit and that because it is in a deposit scheme, I need to wait until the end of the tenancy to retrieve it and they will be liable for any legal costs I incur in doing so (solicitor's fee for single claim etc) and that I will charge interest as per the provisions of the lease for every day that the rent is late.

I have strongly suggested that they try to find the money. I'm hoping that the mention of interest and legal costs will encourage them to do so. However, this might not work.

I just wondered if I should be doing anything else? As the deposit is 6 weeks then I'm fairly confident that I won't end up out of pocket in the long term. Although I haven't inspected the property yet to see what condition it's in. Last time I was there it was dirty but generally looked ok.

Also, I would normally expect to inspect after they vacate but would anyone recommend inspecting early? I'm quite keen to check the property is in a suitable condition for viewings (I'm using an agent to accompany viewings this time) and I want to make sure that there isn't any serious damage while they are still in the country and we have time to sort this out.

Any advice much appreciated. Thank you.

sarahevie

Ridiculous to suggest that there is a solicitor's fee involved with a single claim. Costs £5 to be witnessed nothing else.

Also you do not have to wait until the end of tenancy to retrieve the deposit with the DPS, although I would recommend you do so as an 'incentive' for the tenant to leave property in as good a condition as it was let in.

If the deposit has already gone, there is argument that this is the 'green light' to cause damage. The DPS told me this themselves when I almost had to go for a deposit halfway through tenancy, due to large rent arrears. Didn't come to that, did extra hours at work.

As for viewings they have the right 'to quiet enjoyment' so do not have to let you 'inspect.' I don't think it would make a lot of difference to be honest whether you inspect now or later, if they want to thrash the place they will. There is the option of court once they have left to recoup the losses although probably a no goer due to the fact they won't be in the country.

Chalk it up to experience, if there is damage, is my best advice. A single claim with DPS is fairly straightforward especially if the tenants don't object. They get two weeks to respond to your claim, if they don't then you automatically win.

tygr

Thanks

I don't expect them to trash the place but I see what you mean. Surely they'll be keen to get the rest of the deposit back if they can. Our relationship has been very good and I suspect the non-payment issue is mostly because they will be on the other side of the world and are worried about sorting out the deposit from there (although with global banking and the internet I don't see that this is really a problem but anyway).

I've already clicked the button to apply for a single claim form. I didn't know the fee was only £5 (I found that out today and I emailed them yesterday) but I think it's reasonable to use the possibility recovering any legal costs incurred as a lever and the lease includes provision for it.

I think for my own peace of mind, I'd like to know that the place is in good condition before they leave. They've had quiet enjoyment for most of the tenancy. As long as I give them sufficient notice, I think that will be fine won't it? They've also bought furniture which they're keen to sell to me so it's in their interest to let me come and see it!!

At least then I can point out anything which they'd need to put right to get the full deposit (less rent owed) returned and it gives them a few weeks to do it ... or not.

Annisele

tygr wrote: »

I think for my own peace of mind, I'd like to know that the place is in good condition before they leave. They've had quiet enjoyment for most of the tenancy. As long as I give them sufficient notice, I think that will be fine won't it?

Sorry, but your tenants have the right to quiet enjoyment for their entire tenancy - it would be a pretty useless right if they could only have it most of the time!

It sounds like you have a fairly good relationship with them, so if it would make you feel happier I don't see a problem with you asking to look at the place.

tygr

Well obviously I will ask!! I wasn't intending to a) let myself in or b) demand that I come at a particular time. I know the law and I'm not an idiot. But point taken if I didn't make that clear.

I now live 100s of miles from the property and so I am trying to minimise the number of times I need to travel there because it has practical implications for me. I am trying to work out what is the best thing to do to protect my position and minimise stress and I was hoping for some advice from others with more experience than me.

I don't want to visit twice if I don't have to and I am expecting to need to visit between tenancies to ensure the place is ready for the new tenants. However, last time I visited (which was to replace the washing machine and yes I did ask if they minded me coming in to get the new one installed!), I noticed how dirty the place was and how overgrown the garden was and I would prefer the place to be looking at its best when viewings are being conducted. Again, I am within my rights to ask them to rectify these things, which I did, as both are covered in the agreement.

Also, worst case scenario, if they are leaving the country two days after the end of the tenancy and there is serious damage, I'd prefer to know about this sooner rather than later.

vax2002

If landlords did not rip people off for deposits and the DPS companies actually did the job they were set up to do then this would not happen, but all too often landlords fiddle the deposit, tenant's know DPS schemes just give it straight to the landlord with no checks so they make sure they get it back one way or the other.
DPS has been a disaster, I know at some who have been ripped for £800 deposits by DPS when they left the house in better condition than they rented it, landlord sent pictures of a completely different house and DPS coughed up to the landlord no question no arguments.

tygr

I agree vax but not all LLs are rogues. I did some research on this issue and on many forums, tenants are being advised not to pay the last month's rent on the assumption that all LLs will try to unfairly withhold the deposit.

My rental property was my home for 10 years but I moved due to a change in personal circumstances. I like to think I'm honest and reasonable and am not out to make a quick buck but I do rely on the income. Luckily I have savings to pay the mortgage and service charge with this month but it's not as if we're all fat cats with loads of resources at our disposal and exploiting tenants for fun.

All property is theft though eh?

G_M

Obviously amicable agreement is best, both as regards inspections, viewings by prospective tenants, rent payment, deposit return etc.

So the more you can agree amicably on these topics the better.

However if they withold the last months rent, in practice all you can do is claim it from the deposit and hope the remaining deposit is sufficient to cover any other costs.

Brallaqueen

I found it to be common when renting to students in general - partly because they didn't quite understand the importance of contracts (youth and inexperience) partly because they had previous experience of landlords treating them badly so were trying to protect themselves as much as possible from losing money.

If you are looking to rent to international students in future you might want to consider taking a lump sum of rent in advance?

GAH

OP, I fully agree with G_M above.

You will have to take rent from the deposit. Theres no point intaking legal action as they will have left the country by then.

You will then have two weeks money left, which you will probably need for a cleaner, Students rarely leave a property clean.

Not all tenants are like this, but most don't trust getting there deposit back in time, so it does happen.

vax2002

The case in question I knew of the LL fiddled the deposit with photographs of a different property and then tried to get a CCJ for damages, however I acted as Scam buster and investigated the evidence, we matched the tenants own family pictures with the landlords and found out he had had two new windows fitted on walls were there were no windows, that these new magic windows allowed light in but were still bricked up walls on the outside, in other words this was not the same house, also the wallpaper was the same as he must have owned several houses, but plug sockets and light switches, again were not in the same place, we requested that the court make an order to allow us to take further investigative pictures to match up with the landlords own property, mysteriously the LL dropped the case.