October 3

How much does a Money Claim Cost against your tenant for money they owe over and above their deposit?

How much does a Money Claim Cost?

The court fee is based on the amount you’re claiming, plus interest.

Claim amount
Fees
Up to £300
£35
£300.01 to £500
£50
£500.01 to £1,000
£70
£1,000.01 to £1,500
£80
£1,500.01 to £3,000
£115
£3,000.01 to £5,000
£205
£5,000.01 to £10,000
£455
£10,000.01 to £200,000
5% of the claim
More than £200,000
£10,000

To calculate 5% of the value of the claim, take the amount you’re claiming and multiply it by 0.05. If necessary, round down the result to the nearest 1 pence.

The fee will be calculated for you if you make your claim online.

If you do not know the claim amount

Use the paper claim form if you do not know the exact amount - you cannot make a claim online.

You’ll need to estimate the amount you’re claiming and pay the fee for that amount.

For example, if you estimate you’re claiming between £3,000.01 and £5,000, you’d have to pay £205.

If you leave the ‘amount claimed’ blank, the fee is £10,000.

Fees as at 3 October 2022 - The latest fees are here Money Claim. 


I am Busy, Can anyone lodge this on my behalf? Such as my Letting Agent.

Whilst your letting agent can provide the information for the submission (and in some cases provides statements to support your claim including rent schedules) it is only a solicitor or yourself that submit the Money Claim Online. Lettings Agents and/or third parties are not able to represent you in court. 

Obviously a solicitor will charge you for the preparation and in many cases it may cost you more than the amount claimed. You may get some of these costs awarded however winning a claim is no guarantee that you will actually receive the money. So it could be throwing good money after bad. 


Are you going to throw 'Good Money after Bad'.

In our experience you are highly likely to win the court case as there isn't much to argue from the Tenants perspective. The tenant may not turn up and the court is likely to grant all of the arrears, interest and costs. This is the best case, however you then need to get get the money from the Tenant. This will prove harder. 

If they turn up the court is likely to grant them a payment plan usually somewhere upwards of £20+ per month but usually disappointingly low. They will get a County Court Judgement (CCJ) against them which will make it hard to get credit so this can be a motivator to pay (although not a very good one). However we do find that after a couple of months they stop paying (and you have to decide which direction to go then). 

You can pay about another £750 - £1000 for court enforcement through a Bailiff which may allow you to get the debt, these costs would be added to the debt as well.

The tenant usually doesn't defend the case, but if they do, which is definitely possible, we have to go to court over this, then you may have to hire a solicitor/barrister to attend court this would present further costs (around £1200 to £2500). 

Many cases never get to this stage and you can of course represent yourself and save yourself the money (I won't get into the merits or risks of this).

So it's a judgement call on your part on this. I detest the tenants walking away from their commitments to you but I also don't want a situation where good money goes after bad money. The decision is yours and you can get legal advice on this. 

There is also a saying 'You don't sue a man of straw' in other words if the tenant feel behind in their rent it's likely they didn't have the money then so are they likely to have it now. So the best we usually get is a court directed repayment plan. 

However I personally loathe the fact that many tenants where you don't proceed go and do the same thing to the next Landlord again. It has become a sport of sorts and we have seen it regular that even in the same building these tenants reapply for another property as if nothing has happened. Appalling that this is allowed to happen. 

We can prepare the Rent Schedule for you to go to the next stage, but over and above this, it will be chargeable. 

So it's up to you the best case is that you pay around the Money Claim fees and preparation fees and you win the case and they pay the arrears etc.  The worst case is the you start the case and it goes to court and you have either pull out at this stage or add additional costs which make it unviable to progress and you have lost your fees and still didn't get the arrears, interest and costs back, plus you lost more time. 

You can also wait up to 6 years before lodging this giving the tenant time to hopefully build up some more assets, get back on track and then pursue the debt. Or you can receive the judgement and then chase with a bailiff down the track.

If your tenant has fallen behind be sure to chat with the team about how you can begin the eviction process, in our experience it is very rarely that a tenant who has fallen seriously behind will they be able to catch up so every day that passes without them paying rent is another day a landlord has lost money.

One Final Point
Of course things happen and tenants are genuinely unable to pay the rent, that's fine and many tenants will work with the agent to bring things back on track but where the tenant refuses to pay and have no excuse this is what is appalling and this is where politicians should step in and protect the landlords, the less landlords the less property available to rent and the higher the rents so its in everyone's best interests to have a fair system. That's certainly not what we are seeing in the past 7 years. 


Tags

legal claim, money claim, tenant default


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