12 out of 13 tenants asked for “Rent-Free Holiday”?

by Readers Question

9:10 AM, 14th April 2020
About 4 months ago

12 out of 13 tenants asked for “Rent-Free Holiday”?

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12 out of 13 tenants asked for “Rent-Free Holiday”?

I have 13 single tenancies (family homes) in Reading. All houses are rented to Eastern European families. All tenants except 1 (in total 12 tenancies) contacted me in last 2 weeks and refused to pay me. None of tenants in question appear to know each other.

The reason given by all 12 tenants is:

“The government has decided that, Banks must give you holiday for 3 months, in return we must not pay you for 3 months” When I attempted to explain meaning of holiday does not mean complete waiving off rental payment it simply means deferring payment depending on their circumstances, which means they must reach another agreement as to how they will make payment after 3 months in addition I requested proof of their income being impacted. They have all refused to provide any proof when I raised the possibility to taking matter to Court, most of them suggested I will not be able to do this as all Courts are shut and government will not allow this.

This clearly shows that government has caused a huge confusion and all of tenants appear to think regardless of their circumstances this is “Rent-Free Holiday” I am very worried about this as even if my Bank allows me to take payment holiday which they will, nonetheless, Mortgage Company will simply allow Mortgage payment holiday, but will not replace rent.

My main source of Income is property income, which pays for my Tax, Maintenance and my Livelihood. In addition, if these tenants fail to bring their account up-to-date after 3 months then I would have lost £1000’s and would accumulate further Mortgage debt.

Simon



Comments

akhan

11:34 AM, 14th April 2020
About 4 months ago

https://www.property118.com/dangerous-fog-of-liability-to-full-rent-during-covid-19/

I wrote this article in response to my tenants reading fake information on face book and then demanding a payment holiday or in the alternative rent reduction.

I swiftly refused and updated them of the law including reference to High trees case detailed in the above article. I was fortunate as I have the necessary legal skills to be able to apply the law to complex legal problems.

The above article deals with most of the issues you have listed.

Thanks

Hardworking Landlord

11:40 AM, 14th April 2020
About 4 months ago

Reply to the comment left by JamesB at 14/04/2020 - 10:54
I have a S21 going through at the moment and the tenant owes me 4 months rent. Can I make a Money Claim Online to attempt to get this back? I had not thought of doing this and don't know much about the process...

Blueskies

11:40 AM, 14th April 2020
About 4 months ago

Reply to the comment left by Prakash Tanna at 14/04/2020 - 10:40
I would ask for some proof of loss of earnings - why wouldn't an employer furlough an employee? Unless the company is going out of business. If it's just a case of the employer can't be bothered why should you have to bear the brunt of that?

Annie Landlord

11:42 AM, 14th April 2020
About 4 months ago

Reply to the comment left by dismayed landlord at 14/04/2020 - 10:50
Most RGI normally requires a S21 or S8 notice to have been served, otherwise they won't pay out. My understanding is that notice can be served at any time, but no evictions can be carried out for 3 months. Given that the lockdown is being extended I wouldn't be surprised if Westminster follows Scotland in stopping evictions for 6 months

Ian Narbeth

11:51 AM, 14th April 2020
About 4 months ago

Hi Simon
I recommend you read Never Split the Difference: Negotiating as if Your Life Depended on it by Chris Voss who was the FBI's top hostage negotiator https://www.amazon.co.uk/gp/product/B018FHCPDO
If you threaten your tenants and start issuing proceedings, I fear you will end up with 9 to 12 months arrears across your portfolio most of which you will have to write off. The courts will have a backlog of cases and whilst the average time to get a tenant out might have been 6 months last year I forecast it will be closer to 12 months this year and next.

Without knowing your tenants and at the risk of generalizing, Eastern European men in particular will be proud men and tough-minded. They won't take well to being threatened. You need to find another approach. Good luck.

Anthony Hawes

11:59 AM, 14th April 2020
About 4 months ago

Reply to the comment left by Ian Narbeth at 14/04/2020 - 11:51
Absolutely agree with all of that.

They are just people, talk to them and give them the facts in a straightforward and friendly fashion.

krodgerson

11:59 AM, 14th April 2020
About 4 months ago

I decided that I would discount the rent of furloughed tenants by 20% which I have done initially for two months. I will not be reclaiming this discount. Most of my tenants are still working from home and have not been discounted or been asked for a reduction. I am trying to help and be fair to my tenants who are all very nice.

Prakash Tanna

12:05 PM, 14th April 2020
About 4 months ago

Has anybody considered that tenants who now work from home at 80% furlough are likely to be spending far less. No travel or fuel costs, no eating out or grabbing a coffee on the way to work, no pubs/restaurants/nights out. No spending the pay check on unnecessary shopping! Does this not equate to them being financially better off and they should be able to afford the rent in full?

Thant said, those who were working 'cash in hand' and not paying their taxes are those who imo will complain and not want/be able to afford paying their rent during the Covid19 situation.

Just a thought and my rant! 😉

Clint

12:08 PM, 14th April 2020
About 4 months ago

Reply to the comment left by Hardworking Landlord at 14/04/2020 - 11:40
Yes, I have not seen anywhere where it states you cannot. I always do even if I believe I will not get the money as it makes it difficult for the tenant to get accommodation elsewhere.
See link below on making a claim:
https://www.moneyclaim.gov.uk/web/mcol/welcome

Clint

12:12 PM, 14th April 2020
About 4 months ago

Reply to the comment left by Annie Landlord at 14/04/2020 - 11:42
So effectively taken into account the delays within the courts due to the pending evictions, we could be looking at a minimum of a year without rent whilst the eviction is going through. It is extremely important now more so than before to get all the documentation correct from the onset.

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