Coronavirus - no rent payments due to self-isolation

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    Coronavirus - no rent payments due to self-isolation

    I have an investment property I have been renting out for five years. I use the services of a letting agent who provides a full management service. This includes vetting prospective tenants and providing a rental guarantee and eviction service if the tenants fail to pay the rent. It is expensive as they take 20% commission but it provides peace of mind. Up until now I have had no problems. Last month no rent arrived my account. I tried to contact the agents but no answer. Concerned, I phoned the main tenant to see if everything was alright. I had a very amicable conversation with the gentleman and he explained that his family had to stop work and self-isolate due to suspected coronavirus symptoms and might have issues paying the rent. I fully understood and knew I could rely on the rental guarantee if need be.

    I kept calling and e-mailed the agent and eventually had a voice message saying that most of the staff had to stay at home and there would be a delay dealing with my query. The next day I received an angry text message from the tenant telling me he was offended by our earlier conversation. He informed me that an eviction was not possible due to the new legislation banning any evictions during the coronavirus period for three months (plus another three months when the legal process takes place). I already knew about the emergency legislation but was more concerned about getting in touch with the letting agent. Afterall - they are not earning any commission when the tenants stop paying the rent.

    Fortunately I am in a good situation whereby I have a smallish mortgage of about £800 per month (the tenant pays the council tax and bills of course) and my income can cover it without relying on the rent. I understand these are desperate times and I have no intention of getting rid of the tenants - I don't understand why he went on the defensive.

    Basically, I thought I would share my situation with you and am wondering if anyone else has encountered a similar situation with their tenants. It would be interesting to find out how you are dealing with the situation as it is early days for me.

    #2
    I would apologise for offending the tenant and point out that you thought you had an amicable conversation and was surprised by his text. Perhaps point out that you aren't intending to evict but, rent arrears will accrue and must be paid at some point. Tenants need to claim any housing benefit due to them so this can be paid towards their rent.

    However, your agency should be doing this, not you.

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      #3
      I'd still be issuing him a s21 notice for his cheek. He doesn't have to know you have no intention of progressing it.

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        #4
        From what you've said, it looks like you have RGI. To make a claim payable, you will need to follow the steps detailed in the policy so keep that in mind. Your LA should be doing all this for you.

        If it's a large chain, you should name and shame the LA, they're doing a piss poor job for 20%! Except for maintenance work at the property, almost everything else about lettings management can be done perfectly well remotely.
        ​​​​

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          #5
          It is not acceptable that the LA is totally absent with no form of contact from their homes, they are the kind of business which is perfectly suited to working from home, they may simply be avoiding all the full maintenance customers due to this issue....... a bit cynical i know.

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            #6
            Originally posted by LandlordJ View Post
            you should name and shame the LA,
            ​​​​
            Not allowed on this forum afaik.

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              #7
              Originally posted by AustralianGuy View Post
              The next day I received an angry text message from the tenant telling me he was offended by our earlier conversation. He informed me that an eviction was not possible due to the new legislation banning any evictions during the coronavirus period for three months
              he may have received some communication from your (p-poor) agent.

              Whilst eviction is not possible, the issuing of S8/S21 notices is.

              Comment


                #8
                Thank you for all your advice. Yes, the letting agent should be taking care of their end of the bargain. I sent a text message apologising to the tenant and explained that I meant no ill and have no intention of evicting him and his family. I also e-mailed the agent to explain the same. So far no reply from the tenant (which should be a good thing) but I did receive a reply from the agency. They apologised for the delayed reply and said they have come to some agreement with the tenants and I will receive the rent money in due course.

                At the end of the day, it is a difficult time for everyone and I would rather miss a few rent payments than have the house empty. This is because the tenants still have to pay the council tax and other bills. If they leave, I will have to foot the bill for council tax (about £270 per month) and any remaining bills to keep the house in order. IAs I said earlier, I can afford to miss the rent payments for a while and if the tenants do cause trouble, it is up to the agency to take care of the expense of evicting the tenants and finding new ones. Hopefully we can ride out this difficult time.

                Comment


                  #9
                  As mentioned above reading between the lines the agent may have contacted after yourself and applied some pressure with threat of eviction on behalf of the landlord. This is maybe the reason for the change of attitude.

                  Some RGI companies such as direct line (I believe) are not processing any new claims, so I think it best to reach out to your insurance company asap if you have not done so already (or make sure the agents do) . There are requirements like contacting them within so many days of an "event" or you will not be covered. Read the small print carefully.

                  As the above mentioned if the insurance does not come through I would issue the required documents and point out this in in case the tenants decide not to make up the arrears once they are working again.

                  I would also want to see evidence that they were not getting 80% pay from being sent home. I would want to see some details of financies to make sure you are not using your rainy day fund simply to avoid using there savings. If they are not working anymore they shoud apply for Housing Benifit and pay you something out of that.

                  As always while they have symptoms avoid any more contact until after the isolation period (14 days) after which they should be in a position to communicate. The fact you mention last month they did not pay and now it's the 10th they should be past isolation... or did they not pay in anticpation of having to isolate? ask to speak to him again after his isolation (but not during as they may be ill)

                  I agree it's not good you are paying an agent 20% to do not much!

                  As the other poster mentioned make sure they understand that while the rent may be delayed it is not being forgiven (unless you think they are in need and you want to be very kind)

                  Basically help the people that really need help (been dismissed by uncaring firms etc or have children and adults that are vunerable) and avoid helping those that are just trying it on because they have read some news paper headline.

                  All the best Stew.

                  Comment


                    #10
                    There's a draft letter to send to tenants on NRLA websites
                    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


                      #11
                      Stew,

                      The RGI won't have been designed for this. Direct Line must be looking into the headlights like frightened rabbits. The thing is they probably can pay but they will be insovent at the end of it! If the letting agent is the insurer you'll not hear from them again. They'll rap up and run with the money. My guess.

                      Comment


                        #12
                        Abstra616,

                        Direct line are not paying anymore from the website

                        "As a result of the change to the law, we cannot pay any new rent guarantee claims as there is no legal mechanism to process a claim. Once this three-month period has ended, and providing the Government re-establishes the legal process, we will be able to progress with the claim as per the policy guidelines"

                        All the best Stew.

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                          #13
                          They will have to pay it, as I said. Either they do so or a Landlord class action will make them. They'll have to. They took the money!

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                            #14
                            They are paying existing cases and no new cases, that's it. They have emailed every landlord that has the cover and told them that. I'm not sure all companies are doing that but DL are.

                            Whatever you and I may think is right or wrong they are not paying

                            All the best Stew

                            Comment


                              #15
                              Originally posted by Abstra616 View Post
                              They will have to pay it, as I said. Either they do so or a Landlord class action will make them. They'll have to. They took the money!
                              A poster on another thread provided terms from their rent guarantee insurance policy.
                              It said, in essence, rent will be covered from the time legal proceedings start.

                              I imagine that DL have a similar clause in their policy.

                              Comment

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