surrender of tenancy - reasonable terms?

tumbledowngirl

Carrying on from my previous 2 threads, we intend to ask our tenants to sign a surrender of tenancy.

As they are now up to date with the rent, and we want the surrender dated for the last day of this rental month, is that the end of costs - or are we entitled to claim any kind of costs, eg in lieu of any kind of notice.

The original agreement has been ended 5 months early and we want to get the surrender now so that there is no problem with getting new tenants and a new tenancy agreement. Because of this, we are potentially saving the current tenants another month's rent, council tax etc - so can we make a request for a settlement in return for freeing the tenant from the agreement?

Kynthia

Probably best not to start new threads when it's the same topic as people will need the facts on the original thread.

You can ask for what you want and if they don't agree the tenancy and their liability for rent continues. However the surrender should include all the costs apart from any damage done as only once the tenancy is ended can you check the property and then claim against the deposit. Therefore the more strongly you want them to accept the surrender the more you should make it something they are happy to accept. Usually the landlord is getting nothing from a surrender so fully asks for all their costs in order to be not out of pocket at all. However you are really keen for them to surrender so don't ask for too much.

tumbledowngirl

Kynthia wrote: »

Probably best not to start new threads when it's the same topic as people will need the facts on the original thread.

You can ask for what you want and if they don't agree the tenancy and their liability for rent continues. However the surrender should include all the costs apart from any damage done as only once the tenancy is ended can you check the property and then claim against the deposit. Therefore the more strongly you want them to accept the surrender the more you should make it something they are happy to accept. Usually the landlord is getting nothing from a surrender so fully asks for all their costs in order to be not out of pocket at all. However you are really keen for them to surrender so don't ask for too much.

Apologies if starting a new thread wasn't a good idea - I though my question might get bogged down by the ins and outs of the background story. I was asking for general info on what an agreement to surrender might contain in the way of costs but I can see now that that depends on the motivation of either party.

Thank you for you advice.

G_M

Who now wants the Surrender?

Obviously the party requesting the surrender is more likely to have to offer something to persuade the other party to agree.

You can offer/suggest/demand whatever conditions you want - the other party can either
* agree
* tell you 'no' or
* make a counter-offer

edit: and yes, lots of new threads is annoying and unhelpful for readers who then do not have all the facts/history in front of them

tumbledowngirl

G_M wrote: »

Who now wants the Surrender?

Obviously the party requesting the surrender is more likely to have to offer something to persuade the other party to agree.

You can offer/suggest/demand whatever conditions you want - the other party can either
* agree
* tell you 'no' or
* make a counter-offer

edit: and yes, lots of new threads is annoying and unhelpful for readers who then do not have all the facts/history in front of them

I can only apologise. It was a genuine mistake - I thought, as I said, that the specific topic of surrenders might be easier for people to respond to, rather than having to wade through a lot of other responses under a different heading. I'm sorry - I can see the mistake I made.

To answer your question - I'm not even sure who wants the surrender. The tenants have verbally said they want us to look for new tenants.
The LA has agreed, whilst also reminding the tenants they are liable for all rents and responsibilities for the property until a new tenancy is agreed. At the same time, he has warned us that it is up to us to be "fair and reasonable" in helping the tenant, ie that we must do our best to get a new tenancy agreement in place.
To this end, the agent is now pushing possible tenants at us left, right and centre - not necessarily tenants that we would choose. We feel that we are being pressured to let the current tenant out asap, under threat of being accused of not being reasonable if we don't.

The agent's proposal is to sign up new tenants and then agree a surrender. Is this a surrender "by operation of law"?
It feels very risky - could we end up with new tenants signed up and the current tenant messing us about?

Our thought is that we would be better to get an agreement of surrender to terminate the tenancy on the last date of this rental month, and before any new tenancy agreement is signed. Obviously this has a benefit to the tenants, because it releases them from any further rent liability - hence my question about whether a financial trade-off was appropriate.

I see now that our wanting to clarify the situation by way of this surrender rather leaves us in no position to haggle.

Kynthia

As I said in the other thread you don't have to mitigate your loss during a tenancy. This is one point that contract law and tenancy law differ. Your tenant continues yo be liable for rent so only accept replacement tenants you are happy with. I personally would get a surrender first for a set amount to be paid by the tenant before signing a contract with new tenants. I would accept the risk of having a void if it meant being free if these tenants that were set high risk of not paying meaning the hassle of courts.

franklee

Kynthia wrote: »

I personally would get a surrender first for a set amount to be paid by the tenant before signing a contract with new tenants. I would accept the risk of having a void if it meant being free if these tenants that were set high risk of not paying meaning the hassle of courts.

Yes, the landlord has the hassle of collecting the money if the tenants have overstretched themselves by having two properties at once. Rent on the old property will be a low priority for them to pay compared to keeping their current roof and their living costs.

tumbledowngirl, If you think there is a good chance of reletting with good tenants soon then I''d get the surrender out of the way. You do not want to be in breach of contract with the new tenants if the old tenants haven't signed the surrender and then refuse your terms to do so.

If it's not going to let for weeks then delay the surrender.

I'd have thought most decent lets get taken quickly but you are right to hold out for good tenants. Remember the agent works for you so you tell them what you want. If you're not happy with the tenants they are finding you could switch agent?

CKhalvashi

franklee wrote: »

I'd have thought most decent lets get taken quickly but you are right to hold out for good tenants. Remember the agent works for you so you tell them what you want. If you're not happy with the tenants they are finding you could switch agent?

This was going to be my advice too if necessary.

My agent guarantees the rent if it's not paid (and charges 9% instead of 7.5-8%), but IMO the extra is worth it for this 'insurance', especially as half the rents here are for pilots/cabin crew.

CK

tumbledowngirl

Thank you for the excellent advice.

Kynthia and Franklee - you have said exactly what we were thinking.
We want a clear finish to the current tenancy BEFORE any new tenancy is entered into. That way, we can take our time to select tenants, rather than be pressured by the agent to take the ones who can sign quickest.
The house is a popular let - we have never had a void, and always have a choice of tenants who want it. Indeed, we've had 3 lots this week saying they want it before they've actually viewed BUT the agent was pushing us to press ahead with a couple with a dog - we have stated not pets, so that gives you an idea of how pushy the agent is to get us to re-let asap.

Another carrot the agent is trying to dangle is an overlap of rents - if we sign up new tenants asap, we'll be quids in by getting the remainder of this month paid for by both current and new tenants.

As the tenant is habitually late with paying the rent, I can foresee a situation whereby we are chasing him for rent next month at the same time as trying to sign up new tenants - or worse still, after we've signed them, if we do what the agent wants.
At least in our current position, the rent is paid until the 26th and we're up to date.

tumbledowngirl

Kynthia wrote: »

As I said in the other thread you don't have to mitigate your loss during a tenancy. This is one point that contract law and tenancy law differ. Your tenant continues yo be liable for rent so only accept replacement tenants you are happy with. I personally would get a surrender first for a set amount to be paid by the tenant before signing a contract with new tenants. I would accept the risk of having a void if it meant being free if these tenants that were set high risk of not paying meaning the hassle of courts.

We have told me the agent we are happy to suffer a void by doing it this way, simply to be rid of the current tenants - in reality, I am pretty sure any void will only be of our choosing, as we have had a lot of interest in the property and all are able to move in asap.

So...what would be a reasonable set amount?
Presumably less than a month's rent, because that's probably the reality of the saving we're giving the current tenant by surrendering before a new agreement is in place.

poppysarah

Get the surrender ASAP and don't let anyone sign a new tenancy for the property until you have.

If you relet before the end of the bit the old tenants have paid for then you could refund them the rent difference.
How much work is needed before reletting?