Serving S21,Tenancy Deposit rules and Sword of Damocles

MissMoneypenny

clutton wrote: »

i rechecked this - the tenant gets the interest - but i received this interest as the tenant had absconded and so was not contactable.

I read it the rules as, the LL gets the interest on the part of the deposit they are allowed to keep and the tenant gets the interest on the deposit amount they get back. Well, the interest allowed after the cost of running the scheme is taken out.

franklee

Hi scrummy mummy,

Thank you very much for getting this clarified. For reference the previous discussion started here:

http://forums.moneysavingexpert.com/showthread.html?p=5915926#post5915926

scrummy_mummy wrote: »

Obviously for those of you seething at this method of operation, the new regulations won't eradicate this proceedure, it might just make it a little bit more tricky....perhaps not

I think it will.

Of course the Sword of Damocles S21 does not actually have to be served on the day the tenancy actually starts, it can be served later. I would consider any S21 that is served when the landlord doesn't actually want possession on expiry of the notice to be a Sword of Damocles. The point being that it allows the landlord to start possession proceedings anytime later on without having to wait the two months notice period.

The main reason the S21 is usually served on the day the tenancy actually starts is:

1. The tenant is busy with the move and so probably won't realise notice has been served.

2. The tenant has just been given other paperwork to sign and will probably overlook the notice, signing it at the same time as "routine".

3. If the tenant queries why he is being given notice the landlord/agent is there to give false reassurances. They will say the notice is "just routine", "will not be actioned should things go well" etc. All lies but enough to make the tenant forget the S21.

I think the new regulations make it harder to disguise the Sword of Damocles. If the landlord has to return to the property to serve the S21 the tenant is more likely to notice and query it. Also there is more chance for the landlord to make a mistake if he is not aware of this aspect of the new regulations.

silvercar wrote: »

If the tenant receives the S21 at the same time as the deposit paperwork (and TDS have just told me they are not sending paperwork direct to the tenant so the landlord will have to do that), what can the tenant do? They are already into the tenancy and living in the property, so they can't refuse it.

The point is the Sword of Damocles only works if the tenant ignores the S21 notice. Tenants are unlikely to do this unless they've been given reassurances that they can or they didn't realise the notice was served. It is easier for the landlord to do this at the start of the tenancy.

If the notice turns up after the tenant is already living in the property then the landlord will have problems convincing the tenant they can stay without invalidating the notice. If the landlord says nothing then the tenant will think the S21 is asking them to leave and leave.

This is why the Sword of Damocles is vile, it requires the tenant to be mislead into ignoring the S21 while at the same time leaving it in place for the landlord to use later on without the tenant realising they can then be asked to leave without any more notice.

The solution to the Sword of Damocles is for tenants to wake up to what it means and ask the awkward questions that force the landlord into reassurances that invalidate the notice. Tenants should also get all renewal discussion in writing. Ultimately tenants can ask in advance, before paying any fees, if the SoD is to be used and walk away from SoDing landlords/agents.

Guy_Montag wrote: »

Silvercar's point, i think, is that once the tenancy has started the tenant can do nothing if they are served an S21 immediately after.

Yes but that was the case before TDS. An S21 has always had to be served after the tenancy has started to be valid. By that point the tenant is committed for the initial fixed term.

silvercar

clutton wrote:

Why would a landlord want to change between schemes ?

I've not been that impressed with TDS. Chose that one because the tenant was renewing so I was already in possession of deposit and also it was the one recommended by one of the landlord associations.

I'm sure all the schemes will have teething problems, but TDS managed to screw up their online payments and now they have stated that they won't be notifying tenants of the deposit and landlords should do this. They have also just brought out a 6 page list of changes to the way the scheme will operate -more paperwork, and if I'm not happy with the changes there is nothing I can do as the deposit has now been protected.

They now say that on a renewal of AST you need to unprotect the original deposit and protect it again! Can't decide if that means you need to do an inspection and agree any charges before renewing a smaller amount or not.

coal9011

Excellent "franklee" ............ I entirely agree with your reasoning and sentiment.

Landlords who issue Sect 21 Notice at the start of a tenancy usually do this in an attempt to camouflage their future intentions. Quite often the new tenant will - as has already been said - miss the inclusion of the notice in the agreement pack. This is no more then an attempt at deception on the part of the LL.

If however the tenant is smart and does notice the s.21 he is usually told by the LL that it's " just routine" or "don't worry, I want you to stay for 12, 18 or 24 months" which is falsely reassuring the tenant, then there is a case (in law) for the tenant to claim that the landlord has "estoppled" himself by making such statements, in particular the latter statement.

MissMoneypenny

franklee wrote: »

The solution to the Sword of Damocles is for tenants to wake up to what it means and ask the awkward questions that force the landlord into reassurances that invalidate the notice. Tenants should also get all renewal discussion in writing. Ultimately tenants can ask in advance, before paying any fees, if the SoD is to be used and walk away from SoDing landlords/agents.

Have I understood this correctly? If a tenant signs another 6 month contract, then the tenant can't be removed from the property until the term is up (unless the mortgate company wants the property back)? At the end of that 6 months, the tenant can just move out, without having to tell the LL or EA that they are leaving if the LL has an S21 in place?

Guy_Montag

MissMoneypenny wrote: »

Have I understood this correctly? If a tenant signs another 6 month contract, then the tenant can't be removed from the property until the term is up (unless the mortgate company wants the property back)? At the end of that 6 months, the tenant can just move out, without having to tell the LL or EA that they are leaving if the LL has an S21 in place?

Yes, that's the case.

MissMoneypenny

So why is an S21 a problem if you have a fixed term contract? Why don't tenants just insist on a fixed term contract? Am I missing something?

coal9011

MissMoneypenny wrote: »

Have I understood this correctly? If a tenant signs another 6 month contract, then the tenant can't be removed from the property until the term is up (unless the mortgate company wants the property back)? At the end of that 6 months, the tenant can just move out, without having to tell the LL or EA that they are leaving if the LL has an S21 in place?

Yes ......... and it would be the landlord's own fault - being left with an empty property - for attempting to deceive/mislead the tenant in the first place!

clutton_2

""they won't be notifying tenants of the deposit and landlords should do this"

so unscrupulous landlords will now be able to keep the deposit anyway as the tenant will not know where their deposit is !!!!!!!

I am a member of the NLA - but chose not to use their scheme purely on the basis of cost - and i am very glad now that it did not. DPS is highly organised as it has been running a deposit scheme in Australia for 8 years, it knows what its doing and has the computer infrastructure to deal with millions of clients.

Franklee says ""The point being that it allows the landlord to start possession proceedings anytime later on without having to wait the two months notice period.""

Within the fixed term this is simply incorrect Franklee.

A landlord cannot seek repossession under Section 21 during the fixed term. He can seek possession under Section 8 etc for no rent, for anti social behaviour blah blah. Section 21 does not need the landlord to give a reason why he wants his house back.

If a tenant moves in on January 1st and a Section 21 notice is included in the AST the Section 21 notice MUST include a date when the tenant must move out by and that date cannot be earlier than May 31st.

Whether a Section 21 has been issued or not the tenant is perfectly entitled to move out on 31st May without giving the landlord any notice whatsoever - as the fixed term is now at an end.

By issuing a Section 21 at the beginning of the tenancy, as far as i am concerned, this levels the playing field somewhat. It allows me to initiate court action 2 months earlier than i could if i had not issued a Section 21.

If i have a tenant who i really want out, why should i have to wait a further 2 months from the end of the fixed term, when he could just walk out if he wanted to. ?

Lets be clear - the tenant can give a months notice once into the periodic and leave

If the landlord wants the tenant to leave - the landlord either has to give two months notice, (and hope the tenant leaves) or then has to issue a Section 21, apply to court, wait a month or two, apply back to the court for a bailiffs warrant, wait a few weeks, then get the tenant out by force - this takes several months and costs £235 in court fees plus any unpaid rent - as in my experience, tenants under threat of eviction tend to stop paying.

So, if there is a sword of damocles here - it is much more over the landlords head than the tenants.

Your experiences with a previous landlord have clearly made you very bitter, and you now choose to judge all other landlords by the same yardstick.

It is sad that you seem to have become absolutely obsessional about this Section 21 business - its the law, and some landlords choose different times to use it - you cannot change this by your one man campaign on this website.

Beating a few landlords here over the head may make you feel better, but, it wont change a thing.


Moneypenny says

If a tenant signs another 6 month contract, then the tenant can't be removed from the property until the term is up (unless the mortgate company wants the property back)? At the end of that 6 months, the tenant can just move out, without having to tell the LL or EA that they are leaving if the LL has an S21 in place?""

A tenant can be removed if s/he does not pay 2 months rent or uses the house for criminal activity or anti social behaviour at any time during any type of tenancy. Section 21 is different in so far as there are no grounds needed - its just the landlord saying 'i want my house back'. This section 21 is useful for landlords who wish to get the house back for their own use for example.

I issue Section 21s on day one because you never know how a tenancy is going to turn out, people can appear nice initially, but, can turn into something quite different. i have never taken any of my tenants to court, so have never had to use the Section 21. i always explain to my tenants that it is a notice to quit. I also explain that we may renew the tenancy. Not all landlords issue Section 21s under duplicitous circumstances. On the first renewal of my ASTs i have never re-issued a Section 21 as by that time i know that i want these tenants to stay on.

Guy_Montag

MissMoneypenny wrote: »

So why is an S21 a problem if you have a fixed term contract? Why don't tenants just insist on a fixed term contract? Am I missing something?

There's no problem if you don't mind moving every six months, but that does not a happy home make. Most landlords won't give out long contracts at least in the first instance.

Finally according Franklee if you stay beyond the end of the tenancy the landlord can let you live happily for months if not years, but then apply for immediate possession using the S21 even though it was served months ago & dated to end at the end of the tenancy (is that right Franklee?)