Debt Collection - rent arrears

Rumana03

Have any landlords on here chased previous tenants for rent arrears? Which company did you use? Were they any good?

Just for background my previous tenants left in 2022 but they were in about £20k rent arrears. I don't have any current address for them. But I heard that it's possible to chase rent arrears as long as it's within 6 years.

fatbelly

I think the sensible policy might be to forget it and move on

sherlock228

you are correct that the statute of limitation is 6 years. That clock ticks down from the later of either the tenancy end date or the date they last "acknowledged" the debt to you (ie responded to you in writing)

For 20k you might get a debt collection company interested as there will be enough money in it for them to make an effort. And yes, such companies do have more experience in, and access to searches of, debtors with no forwarding address. However, finding your ex tenant is one thing, getting money out of them is another. You will need to go to court and almost certainly end up needing to pay bailiffs to collect whatever they can.

Only you can decide if 20k is worth further cost to you

MacMickster

You need to ask yourself why the tenant ran up £20K in rent arrears.

If you think that they did this deliberately because they thoght that they could take advantage of you, while still having significant financial assets then you could consider pursuing them.

If, on the other hand, their rent arrears were likely to be merely a part of larger debts, and they probably don't have a pot to p!** in, then debt collectors aren't going to get anywhere. You are just going to run up additional costs yourself.

theartfullodger

In my experience the easy bit was getting court judgement, the tough bit wass collecting the ££££.

But in one case not knowing where ex-tenant was, I got HMRC letter (to him) giving tax code and name of employer. A small chain of hotels. 3 'phone calls later and I knew his address…

FreeBear

you are correct that the statute of limitation is 6 years. That clock ticks down from the later of either the tenancy end date or the date they last "acknowledged" the debt to you (ie responded to you in writing)

In Scotland, it is five years.

UKTaxHelper

Which basis are you on? If cash, that 20k was never taxed, so whatever the collector gets back is income in the year it lands.

mlz1413

I haven't chased a tenant but have chased businesses and getting a CCJ is the easy bit.

And before you start you need to decide how much more you are willing to spend trying to get any money back …

If your ex tenants don't have jobs and rent their home then a CCJ rarely bothers them.

If they do have a job you can get an Attachment of Earnings, but don't think that will pay you much as you get a % after a min protected income.

If they have an asset like a car then bailiffs might be able to seize and sell, but depends on the age of the car and any finance agreement on it.

If you are doing this for the principle then get your ducks in a row and find out the costs of the CCJ and further Debt Enforcement beforehand. Although they may add their fees it is likely you will need to pay some costs upfront.

_Penny_Dreadful

https://forums.moneysavingexpert.com/discussion/6681426/debt-collection-rent-arrears

You don't use a private company. You ask the court to enforce the CCJ or decree, and there are various enforcement actions the court can take.

In England & Wales the County Court can grant:

• Warrant of Control. Bailiffs and HCEO visit the debtor's home or business to seize and sell valuable goods)
• Attachment of Earnings. The court orders the debtor's employer to deduct regular sums directly from their salary and send the money to you.
• Third-Party Debt Order. The court freezes and uses funds from the debtor's bank, building society, or business account to clear the debt. You will need to know the debtor's bank details.
• Charging Order. The debt is secured against the debtor's land or home.

In Scotland the Sheriff Court can grant:

• Attachment or Money Attachment. Attachment allows Sheriff Officers to seize and sell a debtor's physical assets (like vehicles or stock) outside the home. Money Attachment allows them to seize physical cash or cheques directly from a business premises.
• Earnings Arrestment. The Sheriff Court orders the debtor’s employer to deduct regular, calculated amounts directly from their wages to pay the debt.
• Bank Arrestment. This instantly freezes funds held in the debtor’s bank account. It only captures whatever money happens to be in the account at the exact moment the order is legally served.
• Inhibition. This is a court order registered against the debtor's property. It prevents them from selling or refinancing their land or home without paying off your debt first.

In Scotland, I've successfully used Bank Arrestment and Inhibition to recover money through the courts.