Unlicenced HMO; advice needed please

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    Unlicenced HMO; advice needed please

    A friend has been running a large HMO without a licence.

    Someone has found out and she thinks he's likely to report her. Assuming she intends to rectify the situation, what course of action would be advised?

    Can she apply for a Temporary Exemption Notice (TEN)?
    Are those easy to get (the 1st one) and how long does it take?
    Does having applied for a TEN offer any protection from fines / prosecution while waiting for a decision - either in theory or practice?
    What kind of information is asked upon application and what does the decision depend on?
    If a TEN is denied, are there repercussions for the current or past unlicensed HMO status?

    Any other suggestions?

    #2
    Amongst other repercussions, to have to repay all rent under rent repayment order.

    Do they never learn? Anything?
    I am legally unqualified: If you need to rely on advice check it with a suitable authority - eg a solicitor specialising in landlord/tenant law...

    Comment


      #3
      Originally posted by otorongo View Post
      A friend has been running a large HMO without a licence.

      Someone has found out and she thinks he's likely to report her.
      Good for the reporter. Though I do think that the design of HMO law is perverse and ill considered.

      Originally posted by otorongo View Post
      Assuming she intends to rectify the situation, what course of action would be advised?
      Report herself first

      Comment


        #4
        Yes seen a few of these in the news recently, if your friend annoyed a tenant they will probably have to pay "all" tenants rent back leaving them with no income. Not sure what happens where tax return already filed and payed, maybe have to re-open back tax assessment.

        Given that you put at risk all your income and the fact that it's not hard for "anyone" to find out a license does not exist as most councils have a list online it's probably a very daft mistake.

        I would be tempted to either convert to a single residence but given it's large I doubt they would want to do that, so best apply for a license quickly and hope the property is all up to spec in terms of fire protection, gas certificates etc, EICR's.

        Depending on the amount of HMO's in the immediate neighbourood you may find the council will not grant a license and you have to give notice to the tenants.

        All the best - I have no legal training the above is just my personal view

        Comment


          #5
          Originally posted by Stew View Post
          I would be tempted to either convert to a single residence but given it's large I doubt they would want to do that
          Actually she is willing to do that, at least temporarily, which would still leave the option to bring the property up to spec and licence it at some point in the future.
          As it stands, the property has one tenant too many and he's moving out very soon. Once he's out, it will no longer be a large HMO.

          The thing she's worried about the most is the immediate risk of prosecution and fines, should the situation be reported and investigated before the tenant's move. What would be the best course of action to avoid prosecution in this situation?

          Comment


            #6
            Originally posted by otorongo View Post
            Actually she is willing to do that, at least temporarily, which would still leave the option to bring the property up to spec and licence it at some point in the future.
            As it stands, the property has one tenant too many and he's moving out very soon. Once he's out, it will no longer be a large HMO.

            The thing she's worried about the most is the immediate risk of prosecution and fines, should the situation be reported and investigated before the tenant's move. What would be the best course of action to avoid prosecution in this situation?
            Personally I would think your ""friend" should simply apply for the HMO licence now. Most authority's are unundated and there is close to zero chance of enforcement action if an application is in progress. They can look up local authority affectiveness for example Hackney where they have identified 45000 hmos of which a tiny fraction are licensed.

            Comment


              #7
              Originally posted by otorongo View Post
              Actually she is willing to do that, at least temporarily, which would still leave the option to bring the property up to spec and licence it at some point in the future.
              As it stands, the property has one tenant too many and he's moving out very soon. Once he's out, it will no longer be a large HMO.
              The regulations for large HMOs and other HMOs are pretty much the same (less any licence specific requirements).

              The fire safety and other obligations are still there.
              When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
              Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

              Comment


                #8
                A temporary exemption notice is only for 3 months I think. You can sometimes get a second one for a further 3 months, but I think thats it. At the moment is is likely to take 2 or 3 times that length of time to remove the tenants if they refuse to leave. I think the landlord should probably apply for an HMO licence now. They will then have to ensure that the property meets the conditions while all the administration is being dealt with, but from the date of application they will be "covered" against further RRO claims, possibly insurance defaults, possibly mortgage defaults etc

                In addition to the RRO the Council can impose up to a £30k penalty or an unlimited fine. In my own borough its usually about £8k.

                Comment


                  #9
                  Originally posted by Section20z View Post
                  Most authority's are unundated and there is close to zero chance of enforcement action if an application is in progress
                  My most recent HMO licence renewal application finally received a response around 21 months after submission. So yes I think the above has some merit.
                  There is a fine line between irony and stupidity. If I say something absurd please assume that I am being facetious.

                  Comment


                    #10
                    I can't imagine the exemption notice is an option.
                    On what basis would the council issue one?
                    When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
                    Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

                    Comment


                      #11
                      Originally posted by jpkeates View Post
                      The regulations for large HMOs and other HMOs are pretty much the same (less any licence specific requirements).

                      The fire safety and other obligations are still there.
                      The fire safety is already in place. It's more about licence specific requirements and the whole application process.

                      The process seems overwhelming and she doesn't want to deal with that, not now anyway. Maybe in a year or two.

                      She has 5 tenants and reducing the number to 4 would remove the need for a licence, while still providing a good income, but with less stress and headaches.

                      As she has a lot going on in her life, she doesn't feel now is the time for her to take the plunge into HMO licensing, so applying for a TEN to avoid the most immediate risk, knowing she'd be compliant by the time the TEN expires, sounds like an attractive option.

                      Originally posted by DPT57 View Post
                      A temporary exemption notice is only for 3 months I think. You can sometimes get a second one for a further 3 months, but I think thats it. At the moment is is likely to take 2 or 3 times that length of time to remove the tenants if they refuse to leave.
                      Only one tenant needs to leave. He's already found a place to move to, signed an agreement and will be moving very soon for his new job.

                      Comment


                        #12
                        Originally posted by jpkeates View Post
                        I can't imagine the exemption notice is an option.
                        On what basis would the council issue one?
                        That's exactly what she's trying to find out.

                        But this has clarified some things: https://www.anthonygold.co.uk/latest...rty-licensing/
                        A TEN can only be granted where the landlord notifies the local authority of their intention to take particular steps with a view to securing that the house is no longer required to be licensed.

                        This might be evicting tenants or reducing the number of occupiers. [..]

                        Finally, local authorities are much more likely to grant a TEN where a landlord has found themselves involved in a licensing regime inadvertently. As a tenant will likely be evicted as part of the process a TEN is not likely to be looked on favourably if it is being sought by a landlord who ought to have been aware of a licensing scheme but was simply ignorant.
                        The intention (reducing the number of occupiers) is there. The inadvertency spoken of in the last paragraph, not quite. Let's say it's a case of her having been ignorant.

                        Comment


                          #13
                          Has this "friend" done any training in landlord/tenant law, specifically any in HMO legislation, please?

                          Any reason she's not asking on here??

                          I am legally unqualified: If you need to rely on advice check it with a suitable authority - eg a solicitor specialising in landlord/tenant law...

                          Comment


                            #14
                            I would worry about someone who finds the process of applying for a licence overwhelming running any kind of HMO.
                            When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
                            Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

                            Comment


                              #15
                              Indeed, .. or a whelk stall...
                              I am legally unqualified: If you need to rely on advice check it with a suitable authority - eg a solicitor specialising in landlord/tenant law...

                              Comment

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