September 24

How can buy-to-let landlords get rent arrears paid?

10 steps to follow when you need to chase up rent that is owed to you

Recent data from Your Move concludes that almost one in 10 tenants are in arrears with their rent. PropTech company RentalStep has said that rent arrears cost buy-to-let landlords around £900 million each year – with billions owed at any moment in time. Our systems reduce the risk of tenants falling into rent arrears, but what can you do if your tenant does fall into arrears?
Here are the 10 steps to take to get your rent arrears paid.

1.    Make sure you have full tenant details

Always get a would-be tenant to complete a tenancy application form, providing details such as date of birth, next of kin details, place of work, etc.
Vet the tenant comprehensively – never shortcut this process. This should help ensure you don’t let to a nightmare tenant, but the details you discover and confirm will help you to chase rent arrears should you need to.

2.    Work out what you are owed

While you may be most concerned about the rent arrears, you shouldn’t forget there may be property damages and stolen property, too. Ensure that you have all the rental payments and missed rental payments documented. Also, compare the property against your property inventory.

3.    If the tenant is still on your property, talk to them

Keep those lines of communication open! Speak to the tenant about the arrears to find out what the problem is. It may be that the tenant has overlooked payment, or they may have been away on holiday or for work. They may need some financial assistance. It could be possible that you could help them claim housing benefit, and you may be able to schedule payments in the coming months to catch up with the arrears.

4.    Serve a Section 8 or Section 21 Notice

If you can’t contact your tenant, or they are refusing to speak to you, then you should issue a Section 8 or Section 21 Notice, depending upon the circumstances. You should speak to a solicitor before doing this, to make sure that you follow due process and the right course of action.

5.    Get hold of your tenant referees

Contact those people who stood as references for your tenant. Speak to their employer, family members and friends. You want to try to find out where the tenant is now living.

6.    Check their social media accounts

You must love Facebook when a tenant leaves your property and owes rent. Check the tenant’s social media accounts regularly to look for clues as to where your tenant now lives and works. You may be surprised just how much you can find out. (A word of warning here: never write or say anything derogatory about your tenant.)

7.    Check their credit file

Check the tenant’s credit file to see if they owe other monies elsewhere.

8.    Take further legal advice

Now, with all the information that you have gathered, you should seek legal advice again. It is likely that you will need to chase the debt through the courts.

9.    Be prepared for court

Gather all your paperwork and evidence together, including:

  • A copy of the tenancy agreement
  • Evidence of the tenancy deposit and that it is held in an appropriate tenancy deposit protection scheme
  • Copies of all communication between you and the tenant
  • Proof that you own the property
  • Proof of the amount of arrears

Ask your solicitor if there is any other evidence that may be required, in advance of the court proceedings.

10. Be sure of the outcome you desire

There are several outcomes possible, including:

  • Attachment of earnings – where you are paid directly from the tenant’s earnings before they receive their take-home pay
  • An order for a bailiff to seize money and goods to make good the debt
  • Freezing of the tenant’s bank account

What if you can’t find the tenant?

If the tenant has gone to ground and ‘disappeared’ (it does happen) or you cannot find them, you could hire the services of a private detective or tracing service to try to locate them. If you wish to take this route, then ask:

  • How successful have they been in tracing people?
  • What are their charges, and how much will they charge if they are unsuccessful?
  • What are their minimum and maximum charge?

Is the debt worth chasing?

One final question that you must ask is whether the debt is worth chasing. You will need to gather estimates of costs from solicitors and other services you are using to chase the rent arrears and weigh this against the amount you may be paid.

DIY landlords are most at risk of rental arrears

DIY landlords are three times more likely to have tenants in rent arrears than those who have their properties managed professionally. Landlords who let their properties through Ezytrac benefit from our experience, expertise, systems and procedures to chase up arrears before they become problematic. Our property inspection service allows us to keep a closer eye on your tenant and your property, and our payment systems send out reminders as soon as a rent payment becomes late.
Isn’t it time for you to contact Ezytrac at +44 0 1522 503 717   and discover the benefits of effortless property management?
Live with passion,
Brett Alegre-Wood


Chase up rent arrears

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