Withholding rent due to landlords mortgage lender seeking repossession of house we rent

HarryCarter1995

We are currently renting a house through a private landlord. Myself, partner and 3 children live here. All rent is paid to the agent. The rent has been paid on time every month since we moved in March 2020.

Throughout our tenancy we have had numerous visits from debt collectors asking for the landlord.

Last year we received a letter to advise that an order for sale of the property we rent has been applied for and our landlord has been taken to court due to +200k of debt not being paid back to this company.

We also found out that private investigators had been taking photos of the house we rent and had even approached my partner in the street to ask her questions about the property we rent. 

We were sent the application and evidence to support the order for sale prior to the hearing. It was quite sickening to see that someone had been spying on us and one part even noted 'I could not see inside the property because the curtains were closed'. I considered contacting the police but I assume this is all probably legal?

Firstly, for all of the above reasons I feel our right to 'quiet enjoyment of the property' has clearly been breached.

Landlord did not attend court so the order for sale was granted and stated possession of the property must be handed over to this company in December 2021.

We were in contact with this company's solicitors who advised us not to worry as they are not in the business of kicking families out of their homes during Christmas.

Meanwhile I received a phone call from the agent telling me not to worry as the property will remain the landlords ownership. I assume this was a complete lie.

During December we received another letter, this time from the landlords mortgage lender stating that they are seeking to repossess the property with a court date set to 08/02/2022.

To top things off, I found out that our deposit was never protected.

I have been in touch with Citizens Advice and Shelter. They have advised that our tenancy IS NOT binding on the mortgage lender, therefore there is nothing that can really be done.

They also advised that we can ask the lender for a 2 month delay and if there dont response we can ask the court to delay possession.

We are actively looking for alternative accommodation and the rental market is very tough at the moment with such high demand.

So down to my question. Should I pay next month's rent? If they house may be repossessed after the 8th?

Its hard enough finding somewhere else to rent and even if we find somewhere, the prospective landlord will want to see a reference from my current landlord (if he will even give one). I imagine it won't look good if I landlord advised that I stopped paying rent.

On the other hand, I will probably not get my unprotected deposit back so feel I should keep the rent to cover that.

I could sue for the unprotected deposit but with the landlord most likely becoming bankrupt what are the chances of getting it back?

Apologies for such a long post. I really appreciate any advice or to hear what you would do in my situation?

Many thanks

SuseOrm

The property may well not be repossessed and the only person you’re causing problems for is by not paying rent is yourself because you’ll be in arrears for which the landlord campus you for.  

SuseOrm

Can pursue you for that should’ve said blooming spellcheck

emmajones1976

I have no idea of the answer to this, but would the bank taking possession of a house overwrite the rights of a tenant on a AST? If no, then its none of your concern who owns the house.

HarryCarter1995

emmajones1976 said:

I have no idea of the answer to this, but would the bank taking possession of a house overwrite the rights of a tenant on a AST? If no, then its none of your concern who owns the house.

Landlord has already been issued an order for sale for 250k worth of debt that he owed the company.

But now the mortgage lender is getting involved and they will have mandatory right to possession.

princeofpounds

The 'right' thing - in a very narrow legal sense - is to pay your rent. The fact that the LL is in trouble with the bank doesn't technically change your contract with the LL.

If you do not pay your rent, you still have a liability to the LL for the rent owed up until the point that possession of the property changes. They can, in theory, still take you to small claims court and demand the arrears.

Whether they choose to do that is another question entirely! Because the fact that your deposit is not protected changes a huge amount. Firstly, it means that you have no guarantee of getting it back. Secondly, it makes it far less likely that your landlord will pursue you for non-paid rent, because a) they already have it covered by the deposit and b) you could counter-sue them for the deposit and non-protection penalty. 

So the right thing to do practically is probably not send any more cash to the LL and to use that extra two months of occupation if required/useful. That way you can 'consume' your deposit.

You can think about suing him for the non-protection penalty anyway, but if he is bankrupt you won't really be able to obtain the money.

You won't get a reference, but you probably wouldn't anyway if he has gone bankrupt and lost interest.

emmajones1976

HarryCarter1995 said:

emmajones1976 said:

I have no idea of the answer to this, but would the bank taking possession of a house overwrite the rights of a tenant on a AST? If no, then its none of your concern who owns the house.

Landlord has already been issued an order for sale for 250k worth of debt that he owed the company.

But now the mortgage lender is getting involved and they will have mandatory right to possession.

And my question would be does that wipe out the rights of a tenant, or not?

HarryCarter1995

emmajones1976 said:

HarryCarter1995 said:

emmajones1976 said:

I have no idea of the answer to this, but would the bank taking possession of a house overwrite the rights of a tenant on a AST? If no, then its none of your concern who owns the house.

Landlord has already been issued an order for sale for 250k worth of debt that he owed the company.

But now the mortgage lender is getting involved and they will have mandatory right to possession.

And my question would be does that wipe out the rights of a tenant, or not?

Yes as far as I am aware. The bailiffs would only have to give us 14 days notice to evict us and we would have no right ti stay in the property.

princeofpounds

emmajones1976 said:

I have no idea of the answer to this, but would the bank taking possession of a house overwrite the rights of a tenant on a AST? If no, then its none of your concern who owns the house.

It depends. If the LL has obtained consent to let or a buy to let mortgage then the tenancy would bind the lender. If they are breaching the terms of their mortgage by letting the property then no, it does not bind the lender who can seek possession. A change in possession automatically cancels any subsidiary interests in the title, like an AST (which is why the bank sues the LL for possession and not the tenant in occupation).

In the bad old days, tenants had no voice in the process. Usually they would get a letter from the court explaining that proceedings were occuring, but it was a difficult situation - you didn't necessarily know who would win (and so were uncertain about whether to pay rent) and you didn't necessarily know the timescale.

About maybe 15 years ago the rules changes so that tenants could apply to the court for an extra two months, which was a much more normal and reasonable notice period for people who were effectively innocent parties.

user1977

emmajones1976 said:

HarryCarter1995 said:

emmajones1976 said:

I have no idea of the answer to this, but would the bank taking possession of a house overwrite the rights of a tenant on a AST? If no, then its none of your concern who owns the house.

Landlord has already been issued an order for sale for 250k worth of debt that he owed the company.

But now the mortgage lender is getting involved and they will have mandatory right to possession.

And my question would be does that wipe out the rights of a tenant, or not?

From the OP:

"We have been in touch with Shelter and CAB and our tenancy is not binding on the mortgage lender."

canaldumidi

Post 6: Repossession: what if a LL's mortgage lender repossesses the property?

Answer to the Q is in princeofpounds post above.