I have been offered 6 months rent in advance

I have been offered 6 months rent in advance

19:47 PM, 14th April 2013, About 9 years ago 47

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I have been offered 6 months rent in advanceI have a prospective tenant who has been paid off with early retirement from a major high street bank together with a large critical illness payment for a heart condition.

She has 2 young boys, a broken marriage and a wealthy father as a guarantor. Her credit checks show her to be a very low risk.

She has offered 6 months rent in advance for a 6 month contract. I queried the letting agent about any change in her rights as a tenant if she pays more than 2 months in advance. He checked with his legal advisor and tells me there is nothing different due to an AST being in place. He also says I am within my rights to ask for a further 6 months in advance which will be requested 3.5 months into the tenancy.

The lady in question has a small pension income but a large amount of savings (which means nothing of course) however her father is guarantor with a secure income.

Apart from renting to my step-son last year followed by a refurbishment of the property, this will be my first ‘real’ tenant as such. Trying not to rush into anything but wanting to get the place let.

Would you take her on as a tenant?

Suzanne Edgecombe



Comments

by Mark Alexander

11:43 AM, 20th April 2013, About 9 years ago

@ Londoner43 - the RGI policy Paul Barrett uses is underwritten by DAS, the same insurers who underwrite the scheme for our recommended package which Paul thought was an absolute bargain when we announced it earlier this year. It costs £97 to advertise your property on all major portals including Rightmove and Zoopla Property Group and also includes tenant referencing and a full year of RGI. Paul has been paying a similar amount for the RGI alone! The business we recommend also have some incredibly competitive full management packages if you want to systemise your property dealings to the max - please see >>> http://www.property118.com/index.php/find-me-a-tenant/

by Londoner 43

16:08 PM, 20th April 2013, About 9 years ago

To Mark Alexander, Thanks for your reply. I actually contacted this company when I was looking for a new tenant last month. They do not have much exposure in London, and as I already had my flat with 2 letting agents who advertise on some of these platforms, I decided against signing up with them as well. For the first time in 7 years, it was quite difficult to find a suitable tenant willing to pay the rent the letting agents had valued my flat at, and in the end I had to reduce it considerably. Had I advertised privately to start with, I could have set the rent at a lower level, but given the difficult circumstances, I am not that sure I could have found a suitable tenant this time.

by Mark Alexander

16:48 PM, 20th April 2013, About 9 years ago

Point taken but if all you need is advertising, referencing and the possibility of RGI it doesn't really matter so much about whether an agent has many properties in the area. What's more important is that they market your property on Rightmove and all the Zoopla Property Group portals and that response times are effective.

by Tessa Shepperson

18:38 PM, 23rd April 2013, About 9 years ago

People might be interested to know that the Court of Appeal have now released their Judgement in the Johnson v. Old case - which is the one about whether a payment in advance is rent or a deposit.

You can read about it here http://www.landlordlawblog.co.uk/2013/04/23/court-of-appeal-decision-in-johnson-v-old-good-news-for-landlords/

The decision was that, in the circumstances of this case anyway, the payment was rent and not a deposit.

by Industry Observer

13:21 PM, 25th April 2013, About 9 years ago

@ Claude

Don't worry TDP only applies since 2007 so you had not done anything wrong - then. Now would be a different story.

@Suzanne

Tessa is right Johnson is a rather individual case with some bizarre twists and turns. Your comment about the next lot of rent on a 6 monthly tenancy being requested after 3.5 months is interesting in relation to this Johnson case. Provided the second lot of money relates to the second 6 monthly perio that is fine ansd the agent is correct.

If however that second lot of money is to be applied to the rent immediately, so they/you are always carrying forward an extra 2.5 months money then that would be a deposit.

Would need a brilliantly constructed agreement to get round it and even then I am far from certain you could get round it and avoid the c/f bit being a deposit

by

15:29 PM, 25th April 2013, About 9 years ago

Is there still the issue that OK you take 6 months rent in advance; but you would need to give 6 months notice to quit via S21 as you can't just give 2 month's notice as rent is not paid monthly in advance

by Industry Observer

15:46 PM, 25th April 2013, About 9 years ago

Hi Paul

No I often forget thios one myself. The longer notice period only applies to a s21(4)(a) when periodic. Then it is dictated by the period that preceeded it going periodic.

In the fixed term it is always two months no matter whether the rent is monthly, quarterly, 6 monthly or yearly!!

So you make sure you have issued a s21(1)(b) before it goes periodic

Good question though!!

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