11:47 AM, 19th June 2020, About A year ago
Debt is a reality in every type of business, but unlike almost any other service provider, landlords are unable to terminate a contract with their client if payment is not received.
Only a court may end a tenancy agreement on the basis of non-payment. Even then, the process can only start following a period of accrued debt currently at three months and the grant of a warrant for possession. Should a tenant refuse to leave, it can take anything up to 8 months from the point of serving notice to actually regain possession of a property – an expensive problem.
Following the effects of Covid-19 and the ongoing pandemic, companies such as British Airways have made thousands of redundancies and there have also been 100’s of job cuts announced at many leading brands. With the Furlough scheme due to change from July now is as an important time to consider protecting your risk.
With courts being closed during lockdown there will no doubt be a huge backlog to get through and at a time where the furlough scheme will be gradually phased out, redundancies will be drastically on the rise. The Bank of England has warned the UK is facing the worst financial recession for 300 years
Landlords do not simply provide a product or service to their clients, they provide homes and it is only right that protections should exist. However, the necessary restrictions on ending a tenancy make it all the more important for landlords to understand how to reduce the risks that non-paying tenants pose to their business.
The Lettingsupermarket.com™ team has been working for some time now with our Service Partners to provide a market leading solution to the issues highlighted above.
Rent & Legal Guarantee provides the following:
To landlords with existing tenancies and no protection currently in place:
The opportunity to set up protection mid-tenancy with no restrictions is extremely unusual and we are only able to offer this as a one-off if LettingSupermarket are managing the properties for you.
Our obligation to you is that, in the event that there are any defaults in payment by your tenant, we will pay the full rent monthly until possession is gained or to a maximum of 6 months, whichever is sooner. Your rent is protected and you will not be out of pocket. We also cover the legal costs incurred in re-gaining possession of the property as a result of a tenancy breach.
The cost of this guarantee is just £3% + VAT per property, per month. Average lost rent and legal fees to evict a tenant totals over £9000 to achieve repossession of the property. The latest statistics from the UK Government show that the Coronavirus Job Retention Scheme has protected over 7.5 million workers and almost one million businesses. The figures speak for themselves.
With Rent Guarantee being tax deductible, the cost to you is actually only in the region of 1.8% +VAT, dependent on your tax status and circumstances.
In order to meet the scheme you will need to meet the following criteria:
Please contact us using the form below: