A landlord popped into our office the other day , who has a managed portfolio and wanted to know how we deal with rent arrears .
We told him about two landlords , two very similar tenancies. Both fully referenced however one landlord decided to take out the Belvoir Warranty for 12 months and one didn’t.
Both tenancies commenced without any hitch. However after a couple of months due to a change of circumstance the tenants got into rent arrears.
This is where it changes:
Landlord A : had paid approximately £180 for our 12 month warranty.
With no excess we were able to contact Let Alliance immediately they also commenced paying the rent. And legal action at no extra cost. They served the appropriate notices and also attended court. And whilst this process took place the rent still got paid.
Eventually the tenants vacated before a bailiff was called.
The solicitor will also continue to pursue the former tenants for recovery of the rent.
Landlord B : hadn’t taken any insurance
The landlord had to instruct a company to act for him
- Their in-house legal team serve notice on the tenant cost £117.00
- Choose Section 21 for Accelerated possession only (£802 includes court fee, solicitors fee and VAT)
- Choose Section 8 for rent arrears and possession (£859 includes court fee, solicitors fee, advocate fee and VAT) Checking your notice, proceedings issued, court date set and advocate instructed. He appears before a judge to get a possession order.
- If the tenant doesn’t leave by a date set by the court. Arrangement for officials to remove the tenant. Cost between £227 and £780.00 Don’t forget that during this time the tenant may still not pay any rent so this could still be accumulating.
- And this process could take up to 2 months, if the rent was £600 per month this could add up to £2400. And there may be additional costs for dilapidations.
Landlord A : total cost £180.00
Landlord B : approx total cost £4156.00 possibly more
I know which Landlord I would prefer to be !!!