Recovering lost rent from housing benefit tenant.... any hope?

sarah3891

Hi,

I wasn't sure where to post this so apologies if in the wrong section.

First, before anyone feels the need to highlight my naivety, stupidity, and all together not-very-good-at-this-ness, please don't, there's really no need. I am well aware of my idiocy at this point.... :mad::eek::T

I have one very small BTL property (by way of becoming an accidental landlord, I never had any intention of being one; lost my job, had to move away for work, couldn't sell my property for toffee it seemed so opted to rent it out to offset the mortgage payments) which for the past two years has been rented to tenants in receipt of housing benefit. This will be a common story that follows I suspect....

In recent months, shortfalls have started happening month on month. I had many sob stories, and although I do think there is a lot of truth in the situation, in all honesty, I was probably naive and suckered but I tried to be supportive and offer time and grace to allow them to catch up. I understand now that as payments have been late/short for some time, I could have acted on this sooner. I was however, trying to be nice and help my tenants out by being supportive during a difficult time for them (they had some quite upsetting troubles for a while but hopefully all sorted now). They have been very nice people, and kept the property beautifully. However, they have not caught up on rent and things have suddenly gone from bad to worse...... I was advised by my letting agent I was not able to request direct payment from the council itself for the rent until the tenant had fallen 8 weeks into arrears (please note they were appointed as the letting agent, not a managing one; I am regretting that now....). This has now happened and they are almost £1500 in the red. The tenants have actually come to me and asked for eviction as they have stated to me they cannot afford the rent any longer and the property is no longer suitable, but they have asked for eviction so they can be rehoused.

I discussed with the agent and asked them to take this over, and the tenants have been served a section 21 for eviction (2 months notice and I will be trying to sell again once tenant is gone as sick to the back teeth of it all - I have no idea how anyone can want to be a landlord!) by the agent and upon their direction I have contacted the council about receiving payment moving forwards for the remainder of the tenancy, but does anyone know if there is a process in place to recover lost rent?

I have insurance and a DPS protected deposit but I am doubtful of what my options are from here, if any?

Does anyone have experience of this situation and is there any hope of recovering lost rent?

Thanks x

Caz3121

some landlord insurance policies will cover this so worth checking yours
it does appear that outstanding rent can be deducted from the deposit with any excess being claimed through the court process
http://www.landlordsadviceline.com/landlord-advice.html

sarah3891

Thanks Caz - much appreciated

dancingfairy

I'm not sure on the lost rent but your first priority is to get them out before they owe you even more money and hope they don't trash the property.
What sort of tenancy were they on? Was it for a fixed term or had it gone on to a rolling contract?
When was the S21 served?
Whilst I appreciate you have appointed an agent, I frankly don't trust them to serve the notice correctly so it is worth your while learning about the notice and the procedure as well (to make sure your agents are doing it correctly).
I know there is a useful post on ending tenancies around on here somewhere - hopefully someone will point you at it.
df
Edit: see this post here with details of the differences between ending a fixed term tenancy and where it has gone on to a rolling tenancy:
http://forums.moneysavingexpert.com/showpost.php?p=67759913&postcount=4

[Deleted User]

I'm afraid evicting them this way (the only way) is probably not going to be quick. You have to wait for the two months notice to run out, then wait for a court date to get a possession order, then appoint bailiffs. The council may only help once bailiffs are at the door (not the way it should happen but it can do). Prepare yourself for the long haul.

If they have rent arrears, the council may regard them as intentionally homeless and not be as helpful as the tenants expect. Particularly if they were in receipt of housing benefit. It might be best to get the tenants to go to the CAB or phone shelter before you start court proceedings, they might then realise rent has to be top of their priorities.

MisterB1959

not being able to afford the rent is totally different than paying what they can afford, which MUST be the money theyre receive in housing benefits as minimum, that should reduce your losses, but make it clear, in writing, that there is still rent outstanding every time that happens

sarah3891

dancingfairy wrote: »

I'm not sure on the lost rent but your first priority is to get them out before they owe you even more money and hope they don't trash the property.
What sort of tenancy were they on? Was it for a fixed term or had it gone on to a rolling contract?
When was the S21 served?
Whilst I appreciate you have appointed an agent, I frankly don't trust them to serve the notice correctly so it is worth your while learning about the notice and the procedure as well (to make sure your agents are doing it correctly).
I know there is a useful post on ending tenancies around on here somewhere - hopefully someone will point you at it.
df
Edit: see this post here with details of the differences between ending a fixed term tenancy and where it has gone on to a rolling tenancy:
http://forums.moneysavingexpert.com/showpost.php?p=67759913&postcount=4

Thanks - yes, rolling tenancy on an AST.

Notice has been served as of last week, but under the two month rule upon monthly renewal of contract, it won't expire for approx ten weeks as tenant was 'mid-month' at that point.

sarah3891

deannatrois wrote: »

I'm afraid evicting them this way (the only way) is probably not going to be quick. You have to wait for the two months notice to run out, then wait for a court date to get a possession order, then appoint bailiffs. The council may only help once bailiffs are at the door (not the way it should happen but it can do). Prepare yourself for the long haul.

If they have rent arrears, the council may regard them as intentionally homeless and not be as helpful as the tenants expect. Particularly if they were in receipt of housing benefit. It might be best to get the tenants to go to the CAB or phone shelter before you start court proceedings, they might then realise rent has to be top of their priorities.

Thanks, yes, I understand I can't apply for the court order until the S21 has expired, which is in about ten weeks time as they were 'mid-month' at point of issue. I am hoping however that we are looking at something in the 4 month region?? I hear long haul and I think 'a year'...... council has already contacted me to discuss the NTQ/S21 and I have supplied all necessary info, and have also requested 'payments' to landlord from this point forward in the hope that remaining rents will be paid direct to me.

I feel quite sad about it all; I genuinely like them and really do feel they have been trying; they have kept the property immaculately and with a huge sense of pride (in that sense, they've been the best tenants I have had!! The place has never looked better!) and are raising a young family and I feel as though things just haven't really gone their way.......which is exactly why I am not cut out for this lark and never have been, but hindsight is a wonderful thing hey?

I have huge concerns about trying to sell it too as things are just pretty flat in that area sales-wise, but I'll just have to worry about that when the time comes...... it was a stupid purchase at the time, but I was an idiotic 22 year old with blinkers on back then - never even considered what would happen if I wanted to sell it, move away or if I ever found myself in the position I did. Wish I could go back and have a long hard chat to myself! But onwards and upwards!

jjlandlord

sarah3891 wrote: »

Notice has been served as of last week, but under the two month rule upon monthly renewal of contract, it won't expire for approx ten weeks as tenant was 'mid-month' at that point.

What? Who had the idea to include that in the tenancy agreement?

sarah3891

jjlandlord wrote: »

What? Who had the idea to include that in the tenancy agreement?

I don't understand? From what I can see, to serve a S21 you have to issue it with two months' notice, with the last day being the last day of a period of tenancy when on a rolling contract? So, therefore, as an AST 'renews' the tenancy 'period' month on month, the last day is the last day of a full rental month?

It isn't anything to do with the tenancy agreement? As I understand it, that's the law? Same advice received from several legal parties and the following is from Landlordzone:

'In the case of the Periodic Notice (Section 21(4)a) the notice given must be a minimum of 2 months, ending on the last day of a tenancy period (a day date before the date the tenancy agreement was signed) specifying that possession is required AFTER that day.'

jjlandlord

sarah3891 wrote: »

I don't understand? From what I can see, to serve a S21 you have to issue it with two months' notice, with the last day being the last day of a period of tenancy when on a rolling contract? So, therefore, as an AST 'renews' the tenancy 'period' month on month, the last day is the last day of a full rental month?

Ah, I see.

Well, no there is no longer any requirement that the notice expire on the last day of a period: It can just give two months of notice.

It does not make the notice you (or you agent) served invalid, but you could have saved 2 weeks.

https://lettingmate.uk/book/1-possession-via-section-21-notice