No Respite for Landlords

No Respite for Landlords

13:56 PM, 25th January 2021, About 6 months ago 43

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The Debt Respite Scheme (Breathing Space) guidance was a shock to landlords when we heard about it this week. It is a truly atrocious bit of legislation, heaping even more worry and misery on landlords and also likely to have a very damaging effect on the prospects of any potential tenants looking for private accommodation who have any experience of mental health problems.

I have laid this out in an article this week, which I hope to get to the attention of the powers that be.  Hard cases make bad law: landlords, debt and mental health | TheArticle

The most egregious parts of the rules are the lack of any clear definition as to what constitutes a ‘serious’ mental illness and secondly the idea that someone facing a mental health crisis would be able to live rent-free until the crisis was over – however long this takes.

I have also laid out what this would mean for a landlord surviving on the state pension and the rent from one property. They could go from living on an income of £850pm to having to manage on £50. Of course, as we learned with the effects of Section 24, there will also be cases where they have to live on less than zero.

The worry for landlords unlucky enough to suddenly find their tenant is officially granted the ‘breathing space’ is going to be immense. It is of course already a common experience for landlords to suffer ill health because of their tenants.

Landlord, Bansi Soni, who was on dialysis and couldn’t sleep with worrying about her non-paying tenant said: ‘she’s still occupying my flat and currently owes me 11 months’ rent at £13,750.  The stress aggravated my physical condition which worsened the life-threatening infection I had and meant I had to be hospitalised.’

This was before this latest outrage.

Where is the consideration for or even acknowledgement of the financial and psychological strain that the Government is heaping on landlords?

What about landlords’ mental health? What kind of breathing space are we going to get? I think we all know the answer to that.



Comments

by Dr Rosalind Beck

13:32 PM, 26th January 2021, About 6 months ago

Reply to the comment left by James D at 26/01/2021 - 12:57
And thanks for reminding me about the Telegraph. I've just sent the link to this to her.

by Mick Roberts

14:11 PM, 26th January 2021, About 6 months ago

Reply to the comment left by Dr Rosalind Beck at 26/01/2021 - 12:17
I'm in touch with Ben Beadle at NRLA if u want me to ask him.
I gather though some other already would have done.
Din't they publish this last week, so they probably got something planned.

by Dr Rosalind Beck

14:16 PM, 26th January 2021, About 6 months ago

Reply to the comment left by Mick Roberts at 26/01/2021 - 14:11
I believe the current approach is non-critical and views this as no biggy.

by Steve Masters

14:27 PM, 26th January 2021, About 6 months ago

Reply to the comment left by Dr Rosalind Beck at 26/01/2021 - 14:16
It certainly is a biggy if a loophole exists that T and Debt Advisor can use to swerve paying rent indefinitely whilst in a Mental Health Breathing Space.

If that's the case, it's not just a biggy, it's potentially the biggest of them all.

by Chris @ Possession Friend

15:44 PM, 26th January 2021, About 6 months ago

Reply to the comment left by Steve Masters at 26/01/2021 - 14:27
Whilst the Mental Health ( indefinite ) moratorium is certainly a big deal, the ordinary 2 month ' Breathing Space is going to be a big impact for a greater number of Landlords.
1st - in delaying Possession process by Another Two months, as if it wasn't too slow Pre-Covid, and
2nd - during that 2 months, Debt advisor is going to be looking at options such as DRO, IVA or Bankruptcy to write off most if not all of what Tenant owes Landlord ( and others )

by Chris @ Possession Friend

23:11 PM, 26th January 2021, About 6 months ago

Reply to the comment left by Alan Rogers at 26/01/2021 - 11:00
Don't agree, Do you now how many £ Millions are given in Government grants to Citizens Advice and Shelter, ?
And you can be sure there will be a debt management plan coming out of most, if not all of the Moratoriums.

by Hamish McBloggs

13:28 PM, 30th January 2021, About 6 months ago

The only thing that prevented us selling our last tenanted property is CGT. So we kept it.

The tenant is currently in arrears without (in this case and for a pleasant change) being their fault; they are good people dealt a s**t hand by the current crisis and there is absolutely not point giving them a hard time.

But my normal day job stopped almost entirely as a consequence C-19 and as am self-employed get zero gov't support. Mrs McBloggs also self employed, job stopped, zero gov't support. Dry January has taken on another meaning.

Ironically, the tenant's HB is the only thing preventing my 'working' down the docks but still have less than nothing left as I remain responsible for the insurance, upkeep, safety. Neither of our households is lording it up and the LA wouldn't hesitate to get arsey if I failed to pay my council tax. The LA would, of course, be understanding about it given the prevailing pandemic. But then they would still demand payment just as the BTL lender would.

The value of the CGT is insignificant when compared to increasing costs and lost rent I have suffered in the last 10 years as a consequence of increasinlgy entitled tenants, a civil court system that is not fit for purpose, police that don't follow up crimes because they are a 'civil matter' and a stupid taxation system. Now C-19 without any support to landlords.

The government (whatever hue they be) do not deserve my CGT and I have no way around it without dying. But I have an immediate need to save myself.

Mrs McBloggs and I have done 'the calculation' and it pains me to conclude that it is cheaper in the short-medium term to throw in the final towel. Cheaper both financially and stress. Significant factors in this conclusion being, apart from general hostility, the ever increasing risk of getting something minor innocently wrong and being the underdog in an argument with an LA jobsworth who has the authority to fine us into bankruptcy for an LA with empty coffers.

Selling would vanquish these multiple swords of Damocles forever leaving the Grand Poobah chair next to the fireplace in the local to summon me to stress free evenings whereupon myself and 'normally' employed friends (who got paid 80% on furlough without having to do any paperwork) could sit in shallow, semi inebriated judgement of the world.

Assuming the local re-opens and doesn't get bought by a developer and converted into 30,000 luxuary coffins sold as 'within commuting distance of London'. Philistines.

So I am preparing a least cost final exit and the Government can have back my share of the benefit support that I and all other landlords don't get paid for or recognised for, C-19 or no C-19.

I recently made this clear to my MP, face mask to face mask, whereupon I was told that my letter explained the situation so clearly that it would be put on Rishi's desk. My suspicion is that even if the letter did make it to No.11 it went stright into the out tray because self-employed are too problematic to support in these straitened times and self employed landlords are Devil's spawn.

I was told to apply for Universal Credit. But if you have a personal offset mortgage then it is immediately ruled out.

C-19 has given me time to clarify my thoughts and will forgive any arrears when we are able to sell.

Not my usual jolly self.

Hamish

by Ingrid Bacsa

14:03 PM, 30th January 2021, About 6 months ago

Housing Benefit? Since when did landlords become responsible for victims of the economy? Councils should perhaps hand Housing Benefit funding over to Landlord appointed Officers for them to decide who gets it based on assessments (medical and otherwise) and for these officers to distribute rents direct to Landlords.
We are not responsible for the failed economy - why are WE forced to carry the rent losses??? This is madness ... unless they are just trying to eliminate small landlords - who most certainly will lose everything if they dont close up Now.

by Northernpleb

12:36 PM, 31st January 2021, About 6 months ago

Reply to the comment left by Katy Ann at 25/01/2021 - 18:15
Thank you for your comments can you direct me to the relevant pages that confirm this. Assuming this is the case Would the Independent Regulated Companies be the same ones that Tout there services as Legally `write off all your debts` If your not happy with the memorandum how long are you expecting the process to take. (Please consider it currently takes a year)
And would you be comfortable with receiving no rent on your property for years, and not to get it back whilst they claim mental health issues. Would you agree that a private citizen should take over this responsibility for the Government
And what legal costs are acceptable. Whilst they get legal aid legal

by Gary BTLowner

16:48 PM, 1st February 2021, About 6 months ago

Can anyone tell me, does The Debt Respite Scheme (Breathing Space) cover AST`s prior to May 4th 2021?


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