Additional Unauthorised Occupants

by Readers Question

13:06 PM, 18th June 2015
About 3 years ago

Additional Unauthorised Occupants

Make Text Bigger
Additional Unauthorised Occupants

I am a new Landlord having recently inherited some properties from my father. My dad passed away suddenly without handing over to me, so I am having to learn quickly. I have read a lot of books and have done lots of research, but have little real experience. I am hoping someone can help me with the following situation that I have:- Additional Unauthorised Occupants

I own a pair of semi’s. In one semi lives the daughter, husband and son. Next door lives the elderly mother (85) on her own. I collect the rent from my elderly tenant every month. She often asks me to hold on to the cheque for a few days before putting it in. I think she is living hand to mouth, so I try to help and usually put the cheque in a week later.

Towards the end of last year I noticed my tenants health deteriorate significantly. I also noticed the presence of another family member in the house whenever I called to collect the rent. When I asked my tenant she told me it was her granddaughter who was visiting, due to her own ill health. I didn’t think anything of it to start with, but a recent property inspection revealed she is living with my tenant along with her boyfriend and 5 year old autistic daughter. Her mum (who lives next door) told me she had recently left her rented accommodation because she wants to live close to her mum and she was told a house up the street would be coming up for rent soon.

A couple of months ago the rent cheque bounced again so I sent a standard letter asking for immediate payment and requested all future rent payments be sent by standing order. My tenant rang me and told me she couldn’t possibly pay it by standing order as she doesn’t get her pension and housing allowance on the same day each month. I reluctantly agreed to let her continue to pay it by cheque, but the cheque bounced again last month.

Last week, I received a telephone call from her daughter saying she was trying to sort out her mums’s finances and told me her husband would send the next rent payment to my bank by BACS today. I agreed this would be okay and check on line today. The rent has been received, but not by the tenant’s Son-in-law as agreed, but by her grand-daughter (the person living with her at the moment). I am concerned this payment could enable her granddaughter to make a claim to have a formal tenancy. Has this created a tenancy agreement?

I believe she has given up her property in the hope that she can live in her grandma’s house if something happens to her.

Should I send the money back?

Please advise what you think I should I do?

Thank you

Helen



Comments

Alan Loughlin

10:22 AM, 19th June 2015
About 3 years ago

first rule, no cheques, no cash.

Andre Gysler

11:49 AM, 19th June 2015
About 3 years ago

We had a clause in our contracts stating that payment received from a 3rd party would be treated as though the tenant had paid it themselves and in no way would constitute an agreement with the 3rd party. The tenant agrees to this by signing the tenancy agreement.

Whether it could be challenged in court, I don't know.

Another thing you could do is write explaining that the granddaughter and her boyfriend will be treated as permitted occupiers and do not form part of the tenancy agreement. I think I am right in saying that you only need to give reasonable notice to a permitted occupier to vacate, something like 7 days is reasonable.

André

matchmade

14:30 PM, 19th June 2015
About 3 years ago

Unless you have reasons to think ill of the grand-daughter, it sounds to me as though she is saving rent by moving in with her grandmother, whilst also providing care and company for her. Plenty of people do this, but you are the landlord and you need to formalise the situation, otherwise it could all get very messy if the granddaughter and boyfriend prove to be poor-quality tenants.

I suggest you write a letter thanking her for the rent payment, and that you are accepting the money only as a payment on behalf of her grandmother, and you look forward to receiving any overdue rent as soon as possible. Also say that you wish to meet the grandmother and the granddaughter and boyfriend, to discuss the current living arrangements. It's then up to you: will they be good tenants? Will the household (and the Mum next door) be more stable and more able to pay the rent with four people rather than one living there? If so, you could make them an offer and say you will allow them to continue living in the house, but it must be on a new AST with everyone named, and you must be allowed to conduct a credit check, pursue references with their employers and previous landlords, and/or require a guarantor and deposits. If not, you need to state firmly that you cannot allow the granddaughter & Co to continue living in the house and you are setting a deadline for them to move out.

This could actually work out really well: all three generations living side by side, long-term, looking after the two houses and regarding them as their home. But you need to be sure about their characters and their sources of income, and try and avoid being swayed by sentiment to accept a never-ending series of bounced cheques: it never ends well.

Nick Pope

18:16 PM, 19th June 2015
About 3 years ago

I assume that this is a standard AST and not a regulated tenancy as there are rights of inheritance in the latter case.

Helen (up North)

16:18 PM, 20th June 2015
About 3 years ago

Reply to the comment left by "Alan Loughlin" at "19/06/2015 - 10:22":

This is going to be my first new rule! Thanks

Helen (up North)

16:39 PM, 20th June 2015
About 3 years ago

Reply to the comment left by "Andre Gysler" at "19/06/2015 - 11:49":

The contract clause is an excellent idea and I will be adding it to all future AST’s. I have joined the NLA and will be using their AST and It appears there is an area where I can add my own clause, which is really helpful. Would you have any objection to sending me the wording?

I am going to a look into the advantages and disadvantages of having a permitted occupiers. Unfortunately, I don’t have a deposit for either of these tenants as they were already living in the property when my dad bought the properties at auction. I really need to get things right, so I don’t lose out financially.

Thank you for responding.

Helen

Alan Loughlin

17:18 PM, 20th June 2015
About 3 years ago

never going to avoid all the potential problems, but to lower the odds:

no HB
no cheques, no cash, always bank credit before handing over key.
and definitely no-one whose face you cannot see, never.
no-one who has no photo ID

be prepared to walk away, never compromise, go with your instincts.

Helen (up North)

18:18 PM, 20th June 2015
About 3 years ago

Reply to the comment left by "Tony Atkins" at "19/06/2015 - 14:30":

Thank you so much for this really informative and helpful post.

I am concerned the granddaughter and boyfriend may be poor quality tenants. Several of her grandsons regularly visit and one still lives next door who is 17. There has been quite a lot of anti-social behaviour from him in in the past with late night drinking parties, smoking cannabis and lots of effing and jeffing, but it hasn’t been a problem since I have been managing. I have been told one of the sons has just come out of prison and is currently living with his mum next door! Another unauthorised tenant?

My dad would never have evicted the family as he believed the elderly lady depended on them. I will honour his wishes however, I need to protect my investment as much as I can. I am worried with no deposit and a periodic tenancy agreement that I could end up with a string of unpaid debts for services, unpaid rent and acquire some unauthorised tenants, should the elderly lady pass away. Your post provides a really good solution which I am going to do, but I suspect I will have to get guarantors, as I believe they don’t work and are receiving benefits (which I said I would never take!) This would be a good opportunity to get a deposit.

If I formalise the above as you suggest, would I be able to do the same with the daughter next door. Her tenancy agreement is only in her name. Would I be able to ask for a new AST to include her partner and son? Could I ask for a deposit at the same time?

Helen

Helen (up North)

18:51 PM, 20th June 2015
About 3 years ago

Reply to the comment left by "Nick Pope" at "19/06/2015 - 18:16":

Yes, thankfully it is not regulated!
Helen

Andre Gysler

6:25 AM, 21st June 2015
About 3 years ago

No problem Helen please feel free to use it.

I once had to rely on the Permitted Occupier status once when an elderly couple's son started to take over the rent. He failed to hand over rent that they had given him to pay to us and would actively prevent us from even talking to the tenants.

It got to such a stage that we had to serve a S21 but in order to start the process we had to explain in writing, his status as a permitted occupier as he believed he was party to the tenancy. We gave him 7 days notice to. Acate at which point he went very quiet. We assume he was advised that he had no legal standing and left a week later.

I believe that evicting a permitted occupier is a lot swifter when it comes to enforcement as they are not your tenants. I further believe that so long as you identify the granddaughter and her boyfriend as such in a letter to your tenant (the grandmother) under the guise of formalising their stay, you will have some legal standing to evict them should you need to.

André

1 2

Leave Comments

Please Log-In OR Become a member to reply to comments or subscribe to new comment notifications.

Forgotten your password?

OR

BECOME A MEMBER

Millennials stumble on the Property Ladder

The Landlords Union

Become a Member, it's FREE

Our mission is to facilitate the sharing of best practice amongst UK landlords, tenants and letting agents

Learn More