Prepare for changes to the repossession process post eviction ban

by Nick Thompson

10:42 AM, 21st August 2020
About 2 months ago

Prepare for changes to the repossession process post eviction ban

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Prepare for changes to the repossession process post eviction ban

As the ban on evictions comes to an end this month, letting agents are being warned to prepare for changes to the repossession process including a new pre-action protocol, a temporarily extended notice period and potentially longer waiting times for court hearings.

According to PayProp agents will play a crucial role in explaining the new system to landlords and helping them to manage rent arrears so the option of eviction remains a last resort.

The ban was originally set to last for three months, but was extended for a further two in June. From August 24, courts will start to hear rental property repossession cases again. The government is also creating temporary ‘Nightingale Courts’ to deal with the backlog of cases.

 How will evictions be different?

 The impact of COVID-19 and the subsequent evictions ban means that the process of repossessing a property through the courts will be somewhat different.

 For example, if a landlord’s possession claim relates to rent arrears or non-payment of rent, they will need to provide information on the renter’s financial circumstances and the effect the pandemic has had on them.

 If the information is not provided or is deemed inadequate by the courts, they will have the option of adjourning the case. Landlords issuing a notice for eviction will also be required to provide tenants with three months’ notice until September 30.

 “Following a five-month hiatus, evicting a tenant through the courts may take longer than usual once the ban is lifted,” says Neil Cobbold, Chief Sales Officer at PayProp.

 “The government’s new measures suggest that it wants to limit evictions pursued solely due to COVID-19 arrears. It has also been made clear that the courts will prioritise cases of extreme arrears accrued before lockdown, and cases of anti-social behaviour and domestic violence.”

 “It’s vital that agencies communicate the changing situation to landlords so they can assess their options carefully as the ban is lifted,” he says.

Will COVID-19 fuel an evictions boom?

There has been speculation from some politicians and housing groups that lifting the ban on evictions will lead to a spike in COVID-19-related repossessions.

However, research from the National Residential Landlords Association (NRLA) suggests this may not be the case. A survey of more than 2,000 tenants found that over 95% are paying rent in full or have agreed with their landlord to reduce or defer payments.

The research also found that less than a third of renters in arrears, equal to around 2% of the entire sample, have been served with an eviction notice.

“The majority of tenants have been able to pay rent in full during the pandemic and those that haven’t are likely to have made alternative arrangements with their landlord,” says Cobbold.

“Although there will be many new claims and a significant backlog of eviction cases to be heard when the ban ends, the number related to COVID-19 arrears may not be as high as anticipated.”

Agents can help landlords to manage arrears effectively

Cobbold adds that unless landlords are affected by a significant long-term buildup of arrears, or instances of domestic violence and anti-social behaviour, they should only consider legal action as a last resort.

“If landlords want to deal with tenants who have recently fallen into arrears, there are more effective ways than going through the courts. Letting agents can help them to pursue these options,” he says.

“Agencies can help landlords and tenants to manage rent arrears through affordable repayment plans, digitally recording all payments and automating arrears chasing.”

“This also allows agents to maintain a clear paper trail in the event that the landlord does want to pursue an eviction in the future,” he explains.

“Ultimately, strong and effective communication with tenants can help to reduce the impact of rent arrears before they become a serious issue.”

“Agents that take this approach can help landlords to manage arrears and recoup unpaid rent while sustaining the tenancy instead of pursuing an eviction through a long and potentially expensive court process,” concludes Cobbold.


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Comments

Binks

11:48 AM, 21st August 2020
About 2 months ago

Every time I read the “..landlords will need to provide information on the renter’s financial circumstances and the effect the pandemic has had on them“, my mind boggles. This may work with tenants who communicate and are truthful. And those will most likely come to some sort of agreement with their landlord anyway. So with the other, let’s call them less truthful tenants, who just stop paying and don’t provide the landlord with any information at all, the court will adjourn? Why is the burden of proof here not on the tenant?

Luke P

12:13 PM, 21st August 2020
About 2 months ago

Reply to the comment left by Binks at 21/08/2020 - 11:48
If the Courts want this, why not make the onus on the tenant to provide. Failure to do so will mean any regard to Covid (not that it matters in S.21 or mandatory arrears grounds S.8…or will it??) will be given.

Chris @ Possession Friend

12:39 PM, 21st August 2020
About 2 months ago

Reply to the comment left by Luke P at 21/08/2020 - 12:13
Yes Luke, Tail wagging the dog, Again.

Old Mrs Landlord

12:55 PM, 21st August 2020
About 2 months ago

With Grant Shapps about to make a further announcement on Sunday's planned end of the eviction ban, there seems a strong possibility it will be extended once again thanks to all the lobbying from Shelter, Renters' unions, Labour politicians etc. Why isn't it obvious to everybody that this will mean fewer landlords going forward as more are no longer able to cover their costs with no income, or simply decide they've had enough of being expected to carry the debts of others? More landlords going out of business can only mean fewer homes for renters, a logic which seems to escape those who purport to have the interests of tenants at heart.

Old Mrs Landlord

13:59 PM, 21st August 2020
About 2 months ago

Reply to the comment left by Old Mrs Landlord at 21/08/2020 - 12:55
It seems they've kicked the can a month further down the road. With a raft of tenants losing their jobs in October when furlough ends, the backlog of evictions going through the courts will mean many months of accommodation free to tenants at the expense of landlords. Of course tenants who lose their jobs because of coronovirus aren't to blame for not being able to pay their rent, but neither are landlords, so why must they be the ones to bear the costs?

Old Mrs Landlord

16:01 PM, 21st August 2020
About 2 months ago

Reply to the comment left by Old Mrs Landlord at 21/08/2020 - 13:59
Further to the above, I have now seen that the notice required for eviction has been extended to six months. With eight or more months' delay between eviction notice being served and the tenant actually leaving or being removed by bailiffs, landlords face over a twelvemonth of responsibility for providing free housing. Looking into my crystal ball I see a considerable shortage of rental accommodation in the next year or two.

Chris @ Possession Friend

16:33 PM, 21st August 2020
About 2 months ago

The whole PRS needs to come together and lay a legal challenge to this 12 months prevention of Landlords lawfully recovering they're property, just to off-set the state's welfare burden whilst Sunak pays half-free meals to restaurants, rather than paying Covid-tenants outstanding rent ( as Wales is doing )

If tenants can't afford living - housing, its the welfare states duty to support them. The govt is legally wrong to transfer this financial burden onto the private sector.

Ashleigh

17:46 PM, 21st August 2020
About 2 months ago

I wonder if anyone can shine some light on this for me now the government have extended the no eviction scheme until the end of September. I have one of my tenanted houses up for sale. The tenant is disappointed but understands our reasons and is planning on moving in with her partner if and when we sell. My question is, am I legally allowed to give her a section 21 once we sell or do I have to wait until after this new date in September? Also, do I have to now give 3 months notice instead of 2? Any advice would be great. Thank you!

Chris @ Possession Friend

19:08 PM, 21st August 2020
About 2 months ago

Reply to the comment left by Ashleigh at 21/08/2020 - 17:46
Ashleigh,
Contact us for a better, fuller explanation.


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