Delayed rent payment due to weekend or bank holiday

tallac

The tenancy agreement says rent payment should be paid in full, in advance in cleared funds on 1st the month.

What happens if the 1st is a weekend or a long bank holiday weekend? As I understand, standing orders setup on the 1st of the month where they fall on a weekend or bank holiday will be paid on the next working day.

So as a landlord, if the payment has not been received on the 1st where this day is a Saturday, what is reasonable?

Should landlord request tenant to ensure payment is cleared on or before 1st of the month (as per the tenancy agreement) or
Should landlord allow until the first working day (which may be a 2 or 3 day delay)?

I don't want to be heavy handed but neither do I want to be taken advantage of.

I feel a polite reminder for the tenant that payment must be cleared by the 1st of the month is best approach so it nips it in the bud.

Thoughts?

propertyrental

Good grief! If the rent arrives on the first working day after the 1st, be pleased!

And if this is your most troublesome issue with your tenants, again - be pleased!

pjs493

It’s normal for the rent due date to be 1st of the month but a grace period of a few days to allow for payment to clear on the next working day if the first falls on a weekend or bank holiday. I’ve always expected that when the 1st falls on a weekend or bank holiday for the money to be paid into my bank on the next working day. It would be a difficult landlord who would make life harder for a tenant by demanding the payment be paid early so funds are cleared before the 1st. I’m happy with a next working day payment. 

Most well worded tenancy agreements would allow for this eventuality. If a landlord tried to make life difficult for a tenant because rent was paid on the next working day, I can’t see a tribunal or similar siding with the landlord. They’d likely see the next working day as reasonable. 

DullGreyGuy

Presumably they're paying you directly rather than you using an intermediary that may use DDs to collect funds?

Ideally you'd ask the tenant to set up a standing order for the last working day of the month so you get cleared funds by CoB of the 1st. Getting it by the first business day of the month doesn't feel the end of the world though. 

user1977

Technically it probably should be paid in advance, but the first banking day seems reasonable - assuming your outbound payments are also postponed to then (which mine certainly are).

_Penny_Dreadful

tallac said:

The tenancy agreement says rent payment should be paid in full, in advance in cleared funds on 1st the month.

What happens if the 1st is a weekend or a long bank holiday weekend? As I understand, standing orders setup on the 1st of the month where they fall on a weekend or bank holiday will be paid on the next working day.

So as a landlord, if the payment has not been received on the 1st where this day is a Saturday, what is reasonable?

Should landlord request tenant to ensure payment is cleared on or before 1st of the month (as per the tenancy agreement) or
Should landlord allow until the first working day (which may be a 2 or 3 day delay)?

I don't want to be heavy handed but neither do I want to be taken advantage of.

I feel a polite reminder for the tenant that payment must be cleared by the 1st of the month is best approach so it nips it in the bud.

Thoughts?

Tenants tend to set up rent payments by standing order meaning that if the payment date falls on a non-banking day it gets paid the next available banking day. As a landlord I accept that as it’s how my own bill payments work and I wouldn’t go sending any reminders to enforce the 1st. 

Schwarzwald

, tallac said:

I don't want to be heavy handed but neither do I want to be taken advantage of.

technically it should arrive the day before then.

but practically, this really is not a biggie, either or is typically fine, 1 day early or 1 day late.

How do you think you are taken advantage of? Missing out on implied interest income for 1 day?
Assuming rent is £1,000 pcm and 4% interest rate .... you want to make a fuss for 0.10 cents? really?

Jemma01

If it is DD then the bank will authorise it on the day automatically, but will be cleared the following business day. None of my landlords every haggled me over this. The DD is already setup, whenever the bank issues it to them, it goes. 

Are you asking them to pay cash?

If you're a first time landlord as it sounds, please don't be a painful landlord. Already having an attitude over "being taken advantage of" and "nips it in the bud" is unamusing. 

born_again

Schwarzwald said:

, tallac said:

I don't want to be heavy handed but neither do I want to be taken advantage of.

technically it should arrive the day before then.

but practically, this really is not a biggie, either or is typically fine, 1 day early or 1 day late.

How do you think you are taken advantage of? Missing out on implied interest income for 1 day?
Assuming rent is £1,000 pcm and 4% interest rate .... you want to make a fuss for 0.10 cents? really?

Say 1st is a bank holiday Monday.
Then the day before is a Sunday, the day before that is Saturday, none of which are working days. So that would require a payment 4 days early on Friday.

We previously paid ours on the 1st. Landlord never had a issue with this if it dropped on a non banking day.

If a Landlord does, then i dread to think what other issues a tenant may face 😶‍🌫️

saajan_12

There's the legal requirement per  your contract and what's practically enforceable. 

Legally: If your contract says rent by the 1st, then its their responsibility to ensure the payment clears by that date, so they could set a standing order for the 28th of the month if necessary. 

Practically: If they fail in the above requirement, there's nothing much you can do about it. Since the tenancy fee act, late charges are limited to interest after a grace period (i think 14 days). No judge is going to evict on a discretionary ground (S8 G10/11) over repeated late payments when the lateness is at most the next working day. 

So you can remind them and have nothing to back up what happens if they ignore your reminder, just a slightly annoyed tenant.  Or you can leave it alone and only mention when its later than the next business day. 

tallac

Thanks for all the replies, useful info. Just to be clear, I'm not worried about payment being late due to weekend or bank holiday, it's where that is the start of a slippery slope.

saajan_12 said:

There's the legal requirement per  your contract and what's practically enforceable. 

Legally: If your contract says rent by the 1st, then its their responsibility to ensure the payment clears by that date, so they could set a standing order for the 28th of the month if necessary. 

Practically: If they fail in the above requirement, there's nothing much you can do about it. Since the tenancy fee act, late charges are limited to interest after a grace period (i think 14 days). No judge is going to evict on a discretionary ground (S8 G10/11) over repeated late payments when the lateness is at most the next working day. 

So you can remind them and have nothing to back up what happens if they ignore your reminder, just a slightly annoyed tenant.  Or you can leave it alone and only mention when its later than the next business day. 

Yes, I think this seems the best option. Wait until the first working day and then mention to tenant if it's later than that.