Sending the contract to the tenant before he pays the first month?

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    Sending the contract to the tenant before he pays the first month?

    I am letting a property in England, through a well-known agency. They have found me what seems to be a good tenant, who has paid the holding deposit, passed all reference checks, and has signed the contract using the agency's online document signing tool.

    The tenant wants to receive a signed copy of the contract BEFORE making the first payment.
    The agency advises against it and recommends sending the signed contract AFTER the payment has cleared, but when I asked for details, they couldn't really elaborate why - they just said that's how they do it. The tenant is furious, screams and shouts it's unacceptable, and has pointed out that he doesn't see what the risk for me would be, since of course I wouldn't give him the keys before the payment clears.

    I must say he does seem to have a point: no payment, no keys, so what's the story here? Is the tenant right? Or what would I risk by giving him the signed contract before payment? I haven't been renting in many many years, but what I remember as a tenant is that I'd sign and pay in person at the same time - no electronic signing back then. If they had told me to pay first, and receive a signed contract later, I wouldn't have been happy about it.

    Thoughts?

    #2
    If the contract is on an online service signed with advanced electronic signature, then they already have access to it, they can just print a copy off themselves......

    Have YOU signed the contract? The tenant is rightly concerned about sending over large amounts of money without a contract first.
    I am not a lawyer, nor am I licensed to provide any regulated advice. None of my posts should be treated as legal or financial advice.

    Comment


      #3
      It's not an advanced electronic signature with digital certificates etc, like other (more advanced!) countries use. It's simply a system where the tenant receives a PDF and is asked to "sign it" with a few clicks. Clearly I don't see what the tenants see, but the agents tell me that, if they log in the system, all they can see is a line saying "Mr Tenant --> signed; Mr Landlord --> signed" but they cannot download an executed PDF, they can only download the blank PDF, till the agency "releases" the executed versions.

      I have signed the contract, with the same online click-based thing the tenant has used.

      Yes, of course I get it that the tenant is rightly concerned about sending largish payments without a contract first; what I'd like to understand is if there is any risk in sending him the executed contract before payment. I can't see what they would be (no payment, no keys, and possession is 9/10 of the law!) nor has the agency managed to explain it. I find the agency's "don't worry your pretty little head because we have always done it this way" approach annoying, so I get it the tenant likes it even less than me!

      Comment


        #4
        There's no reason for the tenant not to receive a copy of a contract that's been signed.
        The agents are just being stupid.
        The contract is a binding agreement and it's been signed.
        If anyone challenged something in it, do the agent think they're going to be able to delete it to fix the problem?

        On the other hand, any tenant who reacted to a small setback by screaming and furious shouting is a worry.
        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


          #5
          Or simply send a draft, watermarked "draft, not signed"
          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...

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            #6
            OK, but what's the worst that could happen? This is what I'd like to understand. Say he gets the contract then doesn't pay. I won't give him the keys. What can he do? Kick the door down and occupy the property? Isn't that a criminal offence? If he were such a scrote he could do that this very moment, after all. It may all be theoretical, but I'd like to understand what's the worst that could happen, because I don't like the agency's approach of "we have always done it this way" without being able to elaborate or explain.

            Comment


              #7
              Originally posted by YetAnotherLandlord View Post
              OK, but what's the worst that could happen?
              The contract exists - so not having access to it right now doesn't affect anything - positively or negatively.
              So I don't think there is a worst that could happen as a result.

              The tenant may need a copy to claim housing benefit?

              Unless they're very new, the agency can't have always done it this way, because the technology allowing it hasn't been around for that long.

              On the other hand, the agency is meant to be working for you, so I'd thank them for their advice and tell them to send the tenant a copy of the contract.
              I suspect that they then might have to admit that they can't or don't know how to - which might be a bigger problem.

              Again, the tenant seems to be massively overreacting, which is more of a worry.
              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
                Yep, the tenant seems to have a short fuse. But then I'm not sure if a tenant who signs a contract without reading it is necessarily better: I have had tenants who did that then kept the property in terrible conditions. If anything, not reading the contract is a sign of sloppiness.

                In fact, there was quite some interest in my property, and this person secured it by offering to pay asking price, but the first 6 months in advance, which isn't bad!

                What do you guys do? When exactly do you or your agents give the contract to the tenants? How many of you give the contract before payment?

                Most importantly, has any of you received legal advice on this point?

                Comment


                  #9
                  I always meet my proposed tenants first to weigh up if I can get on with them and this is what you are missing out on in this virtual tenant find world. Is it out of the question to meet him at a coffee shop or somewhere to discuss things? This is where internet letting falls down IMO. I would not proceed until meeting and chatting with tenant.



                  Freedom at the point of zero............

                  Comment


                    #10
                    You made an offer, it was accepted, even if it were subject to contract both of you have signed one. You have a valid and binding contract. It's perfectly reasonable for him to want a copy as evidence of the agreement before fulfilling his part of the contract by transferring not an insignificant amount of money over.
                    I am not a lawyer, nor am I licensed to provide any regulated advice. None of my posts should be treated as legal or financial advice.

                    Comment


                      #11
                      I did meet with him before we signed because, yes, I agree, it's important to ensure you are on the same wavelength as your tenants. But, at the same time, I am careful not to read too much into these meetings as the world is full of con artists who are very skilled at deceiving trough good first impressions!

                      Comment


                        #12
                        I have no problem with tenant seeing contract. Just he won't be seeing one signed by me before he coughs up.

                        There would be no need to kick the door down. He could just call a locksmith, and show him the agreement to effect entry. The police wouldn't help you then either.

                        Comment


                          #13
                          I hadn't really thought of that. Isn't that a criminal offence? How is it different from a total stranger breaking in? Does the contract even have any value if he doesn't make the first payment?

                          Mmm, if that's the risk I suppose the agency did have a point, but why not tell me? Makes me think someone at the agency had though of that, but the drones working in the office have no clue.

                          Comment


                            #14
                            Old Landlordzone threads are full of stories of landlords who issued a tenancy agreement, but never got a penny. Don't be one of them.

                            Comment


                              #15
                              You mean of landlords who gave the keys before the funds cleared? That would be a totally different story, though.
                              Or of landlords who gave the contract, didn't give the keys, and then... what?
                              The only risk I can see is that described by JKO, but, to be honest, he could do that (kick the door down or call the locksmith showing him a fake contract) now anyway. Not saying I will give him the contract, just trying to understand.

                              Comment

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