Interest on outstanding rent

Collapse
X
  • Filter
  • Time
  • Show
Clear All
new posts

  • Interest on outstanding rent

    On the reverse of AST it states that rent over 2 weeks outstanding can be charged at 4% above bank rate (i.e 4.5%) so 8.5% on outstanding rent is charged IS THIS CORRECT ?

  • #2
    As far as I am aware you can claim statutory rate of interest on any money owed when suing in small claims. This interest rate is 8%(again as far as I am aware....this may have changed, and I am not sure how you calculate it so your statement could be correct). As for the amount of time passed before you can claim this, I'm sorry but I have no idea. However, I would suspect that it is longer than 2 weeks.
    Any posts by myself are my opinion ONLY. They should never be taken as correct or factual without confirmation from a legal professional. All information is given without prejudice or liability.

    Comment


    • #3
      I charge this on my late payers, but to be honest it is very small amount and I just use it to deter late payment.

      For example, and I think this is right, if a tenant is late on a £500 rent, it works out about 12 pence a day! in interest.

      Comment


      • #4
        But of course letting agencies often act like banks do in this respect - charging £20 for a chase-up phone call and £30 for a letter. The charges would have to be in the contract to start with, I guess. If you feel peeved about getting paid late and want to change things next time maybe this is the way to go.
        Personally I think looking the tenant in the eye, having the conversation and making them understand they can't take the mickey on late payments is the first post of call, make it clear that it does not make you view the renewal of the tanancy favourably.
        I wonder how my building society would react if I told them sob stories and was late with mortgage payments....?

        Comment


        • #5
          I think there is a statutory provision, at least for commercial leases, that rent is not considered late if it is no more than 2 weeks late. This may have something to do with the clause mentioned in the your act.

          However, the rate mentioned is an annual rate and will only be charged in respect of the number of days rent payment is late.

          And, why should anyone be peeved at having to pay interest if the rent payment is late?

          From a landlords perspective, it is best to have a clause to charge admin fees or something similar for chasing on late or bounced payment.

          Ramnik
          Private advice is available for a fee by sending a private message.

          Comment


          • #6
            I believe there is something about charging only for real loss
            i.e you took time to write a reminder with a statement - cost £10

            Banks and credit card companies have been told off in several occasions regarding their "fees".

            Comment


            • #7
              Jennifer, you are right. It forms part of the guidance under the Unfair Terms legislation.

              They object to unreasonable charges for late payment. However they are happy if the charges reflect the amount of work a late payment causes.
              For the avoidance of doubt, I am not a solicitor nor a specialist. I have simply spent many years in the business and am expressing my opinions. I would urge caution to any individual using these forums as a sole basis for decision without first speaking to a solicitor.

              Comment


              • #8
                Thanks for help and advice, tenant has now moved out and paid outstanding rent, with no interest, just glad to see her go - once again thanks

                Comment

                Latest Activity

                Collapse

                • S21 and refunds
                  tatemono
                  Because the poor old OP of THIS THREAD has seen it derailed by a long but nevertheless valid debate/argument/discussion about the interpretation of law, I've started a new thread because the discussion has raised some questions I'd like answers to.

                  Say I have a tenant, whose AST started...
                  18-08-2017, 05:52 AM
                • Reply to S21 and refunds
                  tatemono
                  well I kind of hoped that the OP would get their thread back if it was rerouted here but I didn't realise that this really only arises where there is disagreement. Plus the debate over there shows no sign of slowing down despite the OP's plea (in post #39 that he's now confused!).

                  Ah w...
                  19-08-2017, 12:15 PM
                • Reply to S21 and refunds
                  tatemono
                  okay... so if I'd asked them to leave in the middle of the period, then I'd have to refund but my example had them leaving at the end so no refund due....
                  19-08-2017, 11:35 AM
                • Can Mrs T change locks?
                  Berlingogirl
                  Mr and Mrs T are splitting up. Mrs T is looking for a new place before giving notice to LL. Mrs T is going to give notice to LL then move immediately to new place. Mr T has mental health issues and verbally intimidates and bullies Mrs T so she needs to get out before he can start on her.

                  ...
                  19-08-2017, 07:32 AM
                • Reply to Can Mrs T change locks?
                  mariner
                  Tenancies don't change just because someone (usually LL) changes the locks.
                  Mrs T needs specialist advice, as does LL if Mrs T explains her dilemma to him.

                  LL could offer Mr T a sole Tenancy after expiry of Mrs T's Notice.
                  19-08-2017, 11:28 AM
                • Reply to S21 and refunds
                  tatemono
                  My example was hypothetical. Both parties have "plans/wishes" and, feelings aside, there are plenty of reasonable situations where a LL might want to ask a decent T to leave their home.

                  We have two properties where we might have to do this in the next few years. One involves co-ownership...
                  19-08-2017, 11:26 AM
                • Reply to Can Mrs T change locks?
                  theartfullodger
                  Dunno, apologies, good for you helping. Think she should 'phone Shelter 0808 800 4444, open today
                  19-08-2017, 10:11 AM
                • Tenants from Council Waiting List
                  wilfred
                  If you get tenants from the council waiting list, and the council pay the monthly rent direct to the LL, when their 12 month tenancy comes to an end, do the council still advise them to remain if the tenant has nowhere else to stay? It would be all the same if the LL wanted to sell the property asa...
                  17-08-2017, 19:40 PM
                • Reply to Tenants from Council Waiting List
                  wilfred
                  Thanks for clarifying that for me artfullodger, and I didn't know they were homeless people the council asks LLs to house for 12 months.
                  19-08-2017, 10:03 AM
                • Reply to Can Mrs T change locks?
                  Berlingogirl
                  Artful - It's not that's going to be changing the locks - It's Mrs T.

                  I'm not the landlord in this instance. Sorry, I should have made that clear.

                  Mrs T is concerned that if Mr T remains in the property after the notice period ends she will be responsible for all the ££££...
                  19-08-2017, 08:57 AM
                Working...
                X