COVID-19: Support for landlords?

goltho

Apologies if this is already being discussed. Our primary source of income is rental from three properties. I also have a small work pension and my wife has the state pension. I completely understand the government's desire to protect renters just as they are protecting mortgagees. What I am worried sick about is the prospect of being forced to carry our tenants' financial issues for them, with no means ourselves of receiving support. All the properties are mortgage-free as we've worked our butts off over the years to make them so.  There is a general (mis)conception that landlords rake in shedloads of cash and are wealthy. This is absolutely not the norm, and certainly not for us! It's simply our method of paying our bills which of course carry on regardless of whether tenants pay on time (or at all).  We have little savings as it's tied up in the properties, so we have little-to-no buffer to take the tenants' strain.

What are we supposed to do?

pramsay13

You are worrying about one part of the situation but we don't know yet if anything will happen and if it does what the detail will be.

If the government allow tenants to take a break without offering provision for landlords then come back and ask for advice.

NewShadow

It will probably be worth you talking to your bank - I believe the Government backed loans are not restricted in the same way as mortgages/loans so you may be eligible.

Lots of people will be in difficult situations given these unprecedented events so I wouldn't dismiss any option based on what would 'normally' be the case... 

If you have business insurance - I don't know if that's a thing for landlords? - then the Government also confirmed they'd secured agreement from insurance companies to pay on claims relating to loss of income as a result of Government advice... I know that was for pubs/restaurants, not sure if this is also covered, but it's worth phoning your insurer and asking the question. 

goltho

pramsay13 said:

You are worrying about one part of the situation but we don't know yet if anything will happen and if it does what the detail will be.

If the government allow tenants to take a break without offering provision for landlords then come back and ask for advice.

Oh right. So you don't think I should be asking the question now? I'd be glad to know who the "we" are who don't know anything. Clearly like me, you don't, but it's pretty unlikely you can speak for the the rest of the population on here. I'll not come back as I'm sticking with the question here, thanks.

You are right about one thing though. I am worrying about one part of the situation. And that's the reason I've posed the question.

goltho

NewShadow said:

It will probably be worth you talking to your bank - I believe the Government backed loans are not restricted in the same way as mortgages/loans so you may be eligible.

Lots of people will be in difficult situations given these unprecedented events so I wouldn't dismiss any option based on what would 'normally' be the case... 

If you have business insurance - I don't know if that's a thing for landlords? - then the Government also confirmed they'd secured agreement from insurance companies to pay on claims relating to loss of income as a result of Government advice... I know that was for pubs/restaurants, not sure if this is also covered, but it's worth phoning your insurer and asking the question. 

Thanks, that's helpful.

goltho

My rent guarantee cover on my insurance policies kicks in at the start of month 2 of arrears. It's also contingent on eviction proceedings being started at that point which is not being legislated out (for COVID-19 arrears), so how that will be dealt with by the insurers, we'll have to wait & see. If they waive that condition in these circumstances, that would mitigate the situation.

NewShadow

goltho said:

My rent guarantee cover on my insurance policies kicks in at the start of month 2 of arrears. It's also contingent on eviction proceedings being started at that point which is not being legislated out (for COVID-19 arrears), so how that will be dealt with by the insurers, we'll have to wait & see. If they waive that condition in these circumstances, that would mitigate the situation.

In the - hopefully remote - chance that you end up in that situation... come back and update the thread for others who may have the same questions? 

jimmyjammy001

You could sell one of the property's to get some liquidity and still rent out the other 2, you may have to reorganise lifestlye finances if this will bring in less income, unfortunately relying on rental income to fund your Main income is never guanteed, I'm sure there will be a few in your position over the coming months

[Deleted User]

goltho said:

My rent guarantee cover on my insurance policies kicks in at the start of month 2 of arrears. It's also contingent on eviction proceedings being started at that point which is not being legislated out (for COVID-19 arrears), so how that will be dealt with by the insurers, we'll have to wait & see. If they waive that condition in these circumstances, that would mitigate the situation.

What constitutes starting eviction proceedings? Would issuing a Section 8 even though you know you can't do anything with it in the immediate future be enough to satisfy that condition? 

davidmcn

goltho said:

What are we supposed to do?

Do you need to do anything at the moment? Have any of your tenants said they'll have trouble paying the rent? You'd need to be pretty unlucky for them all to stop paying rent.

In the meantime you'll find plenty of suggestions elsewhere on this website for how to reduce your outgoings.

rudigarude

Can I ask, don't you have savings (an emergency fund)? What would happen to your finances if all three properties needed expensive repairs at the same time, e.g. like roof damage from a storm, boilers breaking? As others have said, you're probably worrying unduly at this point, you'd be unlucky if all your tenants to stop paying, just as you'd be unlucky if all your properties need serious repair at the same time. My biggest piece of advice is to stop watching the news and deal with what you actually have to deal with if it happens.