My vendors want to let-out until completing sale to me

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    My vendors want to let-out until completing sale to me

    Hello all,
    I am in the process of buying my first btl. The vendors of the property are emmigrating to New Zealand in December and have asked if they could rent their old home until then. My questions are; when should I start the ball rolling and in what order? Also, should the paperwork be done before completion as that is when the tenancy will start. I have read so many books on the subject, and it's all gone completely out of my head, nerves I guess. Any advice would be greatfully recieved. Thank you.

    #2
    In all honesty, I do not know the answer to your actual question. However, I would worry that they already hold the keys as they obviously already reside in the property. Usually a tenancy agreement only becomes 'binding' upon the handing over of keys which usually only happens once you have received your deposit and rent in advance. If they were to fail to pay rent & deposit etc at the tenancy start date (ie the date of completion) you might have problems and would not be able to seek possession through the courts until they were 2mths in arrears. Can you not have a word with you solicitor to see what the potential risks might be? I wonder if it would be possible / ethical to get the vendors to agree a deduction from the sale proceeds to cover the deposit and a few months rent?

    I'm sure more experienced and knowledgeable members will come to your aid by providing more information.

    Regards

    J

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      #3
      Thanks Joanne, that was quick. I've spoken to the vendors and they have agreed to pay a bond plus one months rent in advance before signing the agreement. They have never rented before. This they will do before completion. They have also offered to pay by standing order if this makes any difference.

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        #4
        Sounds like they might turn out ok as tenants for you. As a matter of interest, what length tenancy are you offering them? Are you planning a 6mth agreement with a view to it going periodic?

        With standing orders be aware that they take a few days to transfer from the tenants bank to your own (particularly if it includes a weekend period).

        J

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          #5
          If vendors are currently owner-occupiers, your solicitor will need to ensure that purchase contract exhibits agreed letting contract. Standard Assured Ternancy (not AST) sounds better in your circs.
          JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
          1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
          2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
          3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
          4. *- Contact info: click on my name (blue-highlight link).

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            #6
            Yes, I was thinking of a 6mth AST. Do you not think standing order is a good idea? What payment method would be best?



            Jeffrey, thank you for your input. Can you relay that message in laymans terms please, sorry to sound so unintellegent.

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              #7
              Originally posted by harrismo View Post
              Yes, I was thinking of a 6mth AST. Do you not think standing order is a good idea? What payment method would be best?



              Jeffrey, thank you for your input. Can you relay that message in laymans terms please, sorry to sound so unintellegent.
              AST is no good for a short letting, eg cannot use s.21 to get possession until six months period has elapsed.
              Not all 1988 Act tenancies are ASTs, however. An SAT is often better for a shorter letting when tenant unlikely to want to hold over.
              Either way, you cannot get vacant possession when you complete purchase. To avoid problems, ensure that V becomes T on basis of a pre-agreed letting embodied in Letting Agreement which forms part of Contract for Sale and Purchase.
              JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
              1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
              2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
              3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
              4. *- Contact info: click on my name (blue-highlight link).

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                #8
                Thank you Jeffrey, I understood that. It made perfect sense to me that time. I'll speak to my solicitor about it. Better to be safe than sorry hey!

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                  #9
                  But Jeffrey - the vendors are wanting to rent until December which is 10mths away. Therefore a s21 wouldn't be a problem! That could be issued two months before december and so any issue of tenants not vacating as agreed would mean Harrismo could action the s21 at the earliest opportunity (if he so wished).

                  I'm feeling like 'a fish out of water' on this one....

                  J

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