Late payment of rent by Letting Agency

by Readers Question

16:38 PM, 17th November 2016
About 2 years ago

Late payment of rent by Letting Agency

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Late payment of rent by Letting Agency

I have two properties that are managed by a letting agency.late payment

Despite receiving statements showing that rent has been paid to the agency by the tenants, the payments to me are constantly two months in arrears.

When I call to chase the payments, I am given a different excuse every month why the payments are delayed. The agency clearly has cashflow problems.

I plan to move agents, but concerned if I do this now, I will never get the overdue rent back.

Many Thanks

Sarah



Comments

Neil Patterson

16:40 PM, 17th November 2016
About 2 years ago

Hi Sarah,

The first thing I would do is check to see if the Agents have Client Money Protection Insurance.

Neil Patterson

17:24 PM, 17th November 2016
About 2 years ago

If/when you move agents you should consider our partner company LettingSupermarket who only charge 4% for full management.

Please see our recommended agents page >> https://www.property118.com/letting-supermarket-full-management/68829/

Romain Garcin

19:36 PM, 17th November 2016
About 2 years ago

Hi Sarah,

If you are worried you can instruct you tenants to pay you directly.

This also would turn the tables on your agent if you mistakenly pay them late.

Mark Lynham

8:49 AM, 18th November 2016
About 2 years ago

I would put a complaint in writing and maybe ask what redress scheme they are registered with as you can complain to them if its not sorted.

John Birchenough

8:54 AM, 18th November 2016
About 2 years ago

The best advise would be go and speak to an agent who is a member of a trade body such as UKALA, ARLA who carry client money protection or a letting agent who is a SAFE AGENT. If you have the rent going direct to yourself you will need to serve notice. Most agent would take over the management, normally free of charge for the transferring over to their agency. The other problem is the agent will still be holding the security deposit, which you most likely don't know if its been secured?

Graham Bowcock

10:14 AM, 18th November 2016
About 2 years ago

Dear Sarah

I think you need to speak openly with your agent about your concerns. It is worrying that you think that the agent has cash flow problems and is using your rent effectively to run their business. This is just not on.

Any legitimate agent will keep clients' money separate from business money in dedicated accounts. Rent should not be paid into an office account. The agent should have an agreement with their bank not to offset clients' money against business debts. This is pretty basic stuff.

Personally I would try to see them, if you are local, be forthright in your approach and find out what is going on. It seems you may have to bail out and get a new agent; I appreciate you are worried about losing money that the agent holds but my concern is that doing nothing may leave you with a worse problem - how is the agent going to be able to recover money for you if they don't have it now?

You may consider using the agent's redress scheme or trading standards.

My advice is to act sooner rather than later.

Graham

Steve From Leicester

14:27 PM, 18th November 2016
About 2 years ago

I'm a well-established agent.

If an agent is receiving rent but not paying it back out to the landlord for two months then alarm bells ring loud and clear because at best the agent is disorganised and at worst he's using client money to prop up his business.

One way or another you should leave this agency and there are some sound points and opinions above.

I'd say anything up to about 8 working days is a reasonable amount of time to allow the agent to process the receipt, check and deduct maintenance bills, fees etc, prepare a statement and get the money paid out. My agency prides itself on being particularly quick, we usually have the money in the landlord's bank account four working days after it lands in ours.

Rob Crawford

21:32 PM, 19th November 2016
About 2 years ago

Firstly, what does your terms of business with the agent say with regards to money being transferred to you? Are they in breech of these terms? Cash flow problems of this nature are a sure sign of a struggling company. If they don't have client money protection and assuming they are in breech of their terms of business, I would write to all tenants and get the money paid direct to you asap. I would not worry about any notice to terminate clause in the terms.

John Birchenough

8:39 AM, 21st November 2016
About 2 years ago

Reply to the comment left by "Rob Crawford" at "19/11/2016 - 21:32":

There is a lot of sound advise going around, but it seems me that Sarah is inexperience and does need professional advise, either from a established Letting Agent or a Solicitor. Yes she can write to the tenants and ask them to pay her directly, but notice must be served (section 48). There is also the problem with the deposits, have they been secured? what company are they secured with? are they custodial or insurance backed? Irrespective what the terms and condition are with the agent get professional advice and assistance, it could otherwise work out costly for Sarah.


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