Agency refusing to send countersigned rental contract before full payment: is it normal?

davidmcn

mitch2509 wrote: »

How is that not what I said? Minus the sarcasm!

You said "you don't get a copy until the money has been transferred", which is incorrect. And there's no requirement for the contracts to stay with either of the solicitors. You gave the impression that you didn't understand the difference between exchange and completion, my apologies if in fact you do.

I'm currently a tenant, I would say the landlord carries the most risk at least financially. They could be thousands down on rent and have a wrecked house.

But they're only going to have a wrecked home or be thousands down on rent if they've been daft enough to hand over the keys before they get their money. When the tenancy agreement is signed isn't relevant.

Thrugelmir

SouthLondonUser wrote: »

My question was: what risks does the landlord expose himself to if he sends me a signed copy of the contract before I make my payment? This question remains unanswered.

Does it matter? If that's the way the LL wishes to conduct their business. Either you accept the terms or move on. As they are in the driving seat. Your opinions are of no value.

SouthLondonUser

Trugelmir, it matters to me. That was the point of the question. If you can't answer the question, don't post. Just saying that they are in the driving seat, which of course I acknowledged already, does not answer the question and does not add anything to the discussion.

For the last time, the question was not: help me convince them.
It was: do they have a point?

Any clearer now?

chris_wa

With tenancies the expectation from all parties ie LL and tenant is that when the tenancy begins the LA or LL has "cleared funds" including the first month rent, SD and any associated fees.

The main reason they wont sign the contract without the funds is that if they sign the contract and provide you with a copy you "could" technically not pay them and take up occupation.

The tenancy is legally binding and you could take the occupation with no rent etc having been paid - it is then a very drawn out lengthy process to evict you.

You may be the most trustworthy person in the world but unfortunately there are alot that arent and this can happen which I have seen first hand. I would be very surprised if any agent or LL allowed a contract to be signed by both parties regardless of when it starts without having all the funds paid upfront.

You may not agree with this practice but is the industry norm

SouthLondonUser

They will obviously only give me the keys after the payment clears, so please explain how I could possibly take up occupation without the keys.

By breaking into a property protected by a burglar alarm?

By holding the agent at gunpoint and getting him to give me the keys.

Really, please explain how as I don't get it.

chris_wa

Once the contract is active ie the commencement date - lets say the 15th August then you are not breaking in.

You have the legal right to occupy - you dont need the keys or the alarm code.

You ring a locksmith as you have "lost" your keys - tenancy agreement and ID shows you have the right to be there - you disable the alarm or ring an engineer as you have lost or forgotten the code.

It happens.....

bowlhead99

SouthLondonUser wrote: »

They will obviously only give me the keys after the payment clears, so please explain how I could possibly take up occupation without the keys.

By breaking into a property protected by a burglar alarm?

By holding the agent at gunpoint and getting him to give me the keys.

Really, please explain how as I don't get it.

You walk up to the door and kick it down. Or you walk through the window leaving a you-shaped hole in it, cartoon-style.

Then you are inside the property. If an alarm goes off, it will self silence after a period of time. If you like, you call the alarm company telling them you are the new tenant of the property and have forgotten or weren't given the alarm code. Or you snip a pertinent wire, knowing that you can afford to repay the landlord for that criminal damage when he sues you (the police have better things to do than argue the toss between tenants and landlords in relation to minor damage).

You then change the locks (or even buy a new door, fitted by a builder or locksmith) to make going in or out more convenient.

Once you are inside the property, with a tenancy contract, you have the rights of being a tenant. The landlord can of course apply to the court to get the bailiffs in and kick you out based on your being behind with your rent (having paid him nil against an expectation of £x by that point in the tenancy). If you don't make good the arrears maybe the court will side with him, but it could take months to evict you. After months of going through the court process, he gets you out; you having given him no security deposit and caused untold damages.

Having "thoroughly assessed your financial situation", landlord hopes you will pay up for the damages, but perhaps you are the sort of person who lies, makes things up, or is vulnerable to losing your job, meaning that a court assesses that you can only pay him back for the £40,000 of damages at £2 a week because you are on the dole.

That is the agent's point, when they say they don't want to risk giving you a fully executed tenancy contract before you have paid in advance. Perhaps they are too tactful to tell you all the ways you might try to screw them over if you are a wrong-un because they don't want to imply you are a wrong-un because it's not good for client relations if the landlord knows they told a prospective tenant that they might be a bad guy. Also, they don't want to give you ideas of all the ways people have screwed them in the past or could perhaps screw them in the future.

So, they simply tell you "it's policy".

If you cant imagine how you could possibly screw them over, then good for you -you're probably a fine upstanding citizen. However, they don't know you from Adam, so when you tell them you're a fine upstanding citizen, they'll take that with a pinch of salt, and stick to their tried and tested policy.

SouthLondonUser

bowlhead, how is what you describe different from someone just breaking into and squatting in a property, which I could do this very moment, if I were such a lowlife? To be clearer: is there any difference in treatment, speed of eviction etc if:

a) a stranger breaks into the property now (which I or anyone could do now!), and
b) I receive the contract, don't pay, and break into the property?

Is the contract even considered in place if the tenant never even makes the first payment? In the contracts I deal with at work, like I said there are often conditions precedent related to the payment, so no payment -> it's as though no contract was ever signed.

I am paranoid, but I am paranoid because I have been screwed over by every single letting agency except one in my life as a tenant. One even claimed the contract I had signed entitled them to certain fees, when it fact it wasn't true: this is why I am so hesitant to pay without having a contract first, because I don't know them from Adam, either, and because my starting assumption is that they will try to steal every possible pound from me, like their colleagues have tried to do in the past. I had to sue a landlord who stole my deposit (before the protection scheme kicked in); another one tried to claim that I didn't have the landlord's authorisation to dispose of certain items whereas in fact I had written confirmation, etc.

Btw, it seems my landlord has asked the same question on landlordzone:
https://forums.landlordzone.co.uk/forum/residential-letting-questions/1035851-sending-the-contract-to-the-tenant-before-he-pays-the-first-month
Interestingly, no one has mentioned that receiving the contract could allow me to take up occupation, and one poster even said the agents are being unreasonable!

Also, 'industry norm' doesn't mean anything. It's the norm that many people don't read nor understand what they sign! When I tried to sell a property, I told quite a few agents to get lost because they were proposing unacceptable terms: many demand payment when a ready and able buyer is found (f* that). Many wanted sole selling rights, so I'd have to pay if I sell to a relative - f* that. Another one put in a clause that if they lost my keys, they'd only be liable for the cost of cutting another one, not to replace the lock. F* that, how is that fair or reasonable? Etc etc etc...

Throwaway1

You seem to be not understanding that if you broke in now, you could just be arrested for breaking and entering. If you 'broke in' after receiving your contract you have a legal right to be there and it could take the landlord months to evict you. You seem to have reached a sticking point in your mind about not having keys. Let's just say then that they don't give you the keys, and you don't fancy breaking in so you simply put up a tent in the garden and sleep in that. The landlord still couldn't rent the property to anyone else as you have a legal contract with them until they manage to go through the lengthy process of making that contract null and void. Once you receive that contract you are legally their tenant with all the rights that tenants get (whether you have paid anything or not).

SouthLondonUser

Throwaway1 wrote: »

You seem to be not understanding that if you broke in now, you could just be arrested for breaking and entering. If you 'broke in' after receiving your contract you have a legal right to be there and it could take the landlord months to evict you.

The tenancy doesn't start before 5 weeks. My right to be in the property doesn't start before 5 weeks. So what you said only applies if I received the contract today, didn't pay for 5 weeks, then tried to break in before the 5 weeks. But if I didn't pay for 5 weeks the landlord would surely serve a notice, try to have the contract voided etc

May I humbly ask if what you say is supported by evidence, by the opinion of legal experts, etc, or if it's just hearsay? I dare ask it because I find it puzzling that no one on landlordzone pointed out the potential problem you mentioned. I am no legal expert, so I have no way of knowing whether you are right, they are right, you are both wrong, or what. That's why any kind of evidence and reference to support what you have said would be most useful.

What is signed is signed but, for the future, I'm wondering if it could make sense to add a clause stating something like: "the funds for the first payment and security deposit must clear within 3 business days from signing, otherwise the contract is null and void
This way if I don't pay I never acquire any rights to the property.

I have seen how stubborn agencies can be, and how they like to hide behind the "it's policy" reply. I argued a lot about uninhabitability, because the contract states that payments is no longer due if the property becomes uninhabitable due to fire or any other risk the landlord was insured against. This means that, if the landlord was not insured against that risk, rent continues to be due. Those gentlemen hid behind the usual it's policy, it's standard, there are complex implications (so complex they couldn't explain them), etc. In the end I accepted it because the risk is remote, and because another clause states that after 1 month of inhabitability the parties can terminate the contract. Still, this doesn't make the clause fair.

bowlhead99 wrote: »

Then you are inside the property. If an alarm goes off, it will self silence after a period of time. If you like, you call the alarm company telling them you are the new tenant of the property[...]

Not quite. The alarm is active and monitored, meaning the landlord would be notified immediately, and security guards sent to the property straight away.

bowlhead99 wrote: »

Having "thoroughly assessed your financial situation", landlord hopes you will pay up for the damages, but perhaps you are the sort of person who lies, makes things up, or is vulnerable to losing your job, meaning that a court assesses that you can only pay him back for the £40,000 of damages at £2 a week because you are on the dole.
.

Landlords tend to forget this risk goes both ways. Yes, I could fritter away all my savings on gambling drugs and prostitutes, then lose my job. But so could the landlord, leaving me with a broke landlord who won't have the money for repairs and maintenance.