Letting agent management - Charging landlord exit fee?

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    Letting agent management - Charging landlord exit fee?

    I am a landlord. New tenants moved in yesterday and tenancy agreement has been signed. Letting agent manages the property. They sent me the contract between myself and the managing letting agent the day after tenants moved in.

    I have not signed contract yet.
    There's a clause that says if I decide to leave the letting agent at any time they will charge an exit fee of 6 months management fees.

    Is this a standard clause and are they allowed to charge this fee? They had not mentioned anything about this previously. Are there any rights for landlords since the new tenancy fee act came in to effect?

    #2
    Originally posted by Mudbar View Post
    Is this a standard clause and are they allowed to charge this fee? ... Are there any rights for landlords since the new tenancy fee act came in to effect?
    Pretty much, possibly no and no.

    It's probably an unfair term, but it is pretty standard.
    Letting agents need to make money and their costs are front loaded, they do all the work at the start of the tenancy and then, like you, hope that the tenant(s) just send the rent and nothing else happens.

    The worst thing that can happen is that the tenancy creates work for them or that you start to manage the tenant directly and cut them out of the arrangement.

    If push came to shove, you could probably argue that it's not enforceable, on the basis that it's obviously a penalty clause, which aren't allowed in consumer contracts.
    The agent would argue differently.

    Unless you're planning to move away from the agent, it's probably academic.
    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).

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      #3
      On the other hand the tenants are there and the LA has no agreement with you so you have the upper hand. Personally I wouldn't sign unless they remove it as it is an unexpected penalty. I don't use an agency so don't know if it's a standard term. The fact that they've done the work without a contract would ring alarm bells for me, I'd wonder what else they hadn't done.

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        #4
        You could cross out the line and then sign it.

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