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Landlord Rights - What to do about bad tenants

Landlord Rights - What to do about bad tenants

Category: Buy To Let

Landlords - make sure you know where you stand with problem tenants!

The rental sector is enjoying a boom time – 40% more people live in rented accommodation now than did in 2006. On the whole tenants are responsible people, who will treat you and your property with respect.

But, unfortunately, it's possible that you'll encounter some tenant difficulty – whether that be from tenants unable to pay the rent because of redundancy or relationship breakdown, or tenants that have no concept of, and pay no heed to their responsibilities to you and your buy to let property.

Choose your tenants carefully

This sounds an obvious one, but it's so important to screen your tenants thoroughly before letting your property out.

A good letting agent (preferably one that's registered with the Association of Residential Letting Agents) will be able to help you by checking a prospective tenant's:

  • credit rating
  • employment status
  • getting references

Make an inventory

Your first line of defence against tenant damage is a proper inventory of the condition and contents of your buy to let property before the tenancy begins. The best way to do this is to pay an independent and competent party to carry out the inspection (your letting agent is unlikely to be considered independent).

You can do this yourself, although if you later need to rely on the inventory in dispute, you'll need to bear in mind that your word (as opposed to an independent party) may not be considered as reliable. Therefore you should look to take photos of the property that are dated, to establish the condition.

Know your rights as a landlord

You've taken all precautions, thoroughly screened your tenant and conducted a meticulous inventory. Yet somehow, against all the odds you've managed to let your flat to an unhygienic, antisocial tenant who has a very 'easy going' attitude when it comes to paying you rent.

So what are your rights?

Payment of rent

  • You should aim to have a written tenancy agreement in place, such as an Assured Shorthold Tenancy agreement. This sets out the amount of rent payable and when.
  • Try to get your tenant to pay their rent into your account by standing order. That way you can evidence which payments you receive and, more importantly, which payments you don't.
  • If your tenant doesn't pay rent for a set period, and no solution is forthcoming, then you have the right to serve your tenant an eviction notice. However, there is a procedure to follow when doing this (please see below). You can also attempt to reclaim any unpaid rent as well.
  • Check the terms and conditions laid out by the letting agent before signing an agreement.

Letting agents generally offer two types of service:

  1. an introduction service, or

  2. a full property management service.

Check what your agent covers as part of their managed service should your tenant defer payment. Some letting agents offer arrears management, chasing arrears subject to a pre-agreed arrears management process and collect missed payments or arrears as part of their contract with you.

Raising the rent

  • You can put up the rent at certain points in a tenancy. This will depend on the specifics of the tenancy agreement – you may have to wait for a fixed term to end before you can make the increase.
  • You can't charge what you like though. The rent has to be justifiable and comparable to similar properties in the area, otherwise the tenant can complain and you could be forced to restore the rent to an acceptable level.

Neglect and damage of the property

  • Damage caused by tenants or people visiting tenants is not uncommon. Whether by accident or on purpose, there will always be tenants who cause damages to your rental property and belongings i.e. furniture, carpets, etc. Annoying as this is, landlords tend to pay for the repairs themselves to save hastle.
  • Your tenants have a level of responsibility to keep your buy to let property clean, in good condition, smoke free (unless your agreement specifically says otherwise) and complete basic maintenance i.e. change light bulbs, use the heating system responsibly. Whilst you are responsible for most repairs, if damages are caused by the tenant, then you should be able to claim these back.
  • The tenant is obliged to stick to the terms of the tenancy agreement regarding matters such as the keeping of pets – if damage or maintenance is required because of this, again you can make a deduction from the tenant's damage deposit or ask them to pay for the cost of repair.
  • The exception to this is for 'fair wear and tear' such as to carpets or other furnishings – you can't charge the tenant for these.
  • Wherever you propose to charge a tenant make sure you have proof that the damage was caused while the property was occupied by them (take photos), properly costed out with quotes to back you up if the tenant chooses to dispute the figure.
  • If the damages are considered way beyond 'fair wear and tear' and the tenant will not either repair this themselves or pay for the cost of repair, you are within your rights to serve an eviction notice to the tenant if you see fit to do so and retain the sum of money from their damage deposit to cover the cost of repair to the damages caused to your property.
  • Your last resort is to go through a legal process to ask the tenant to repair the damage at their expense, but that may not be a viable option as costs could escalate. There are specialist tenant eviction services which could help you do this.

What you can't do

You can't just pay your tenants an impromptu visit, you have to have a good reason, and you need to let them know in advance.
You can't harass your tenants as this is a criminal offence.
You can't just physically chuck your tenants out on the street or 'help' them move. When it comes to evicting problem tenants you have to be careful not to make an illegal eviction – again this can lead to legal action.

Gaining access to your property

  • Unfortunately it is illegal for you as a landlord to enter your own property without prior agreement from your tenant. Landlords do have rights to 'reasonable' access to carry out repairs for which they are responsible, but you will always need to get permission from the tenant with at least 24 hours prior notice. If you don't follow this process you could be prosecuted for 'harassment'.
  • Refer to the Office of fair trading document oft356 which states that: "3.32 We would object to a provision giving the landlord an excessive right to enter the rented property. Under any kind of lease or tenancy, a landlord is required by common law to allow his tenants 'exclusive possession' and 'quiet enjoyment' of the premises during the tenancy.
  • Basically this means a landlord cannot enter the property except for 'good reason'. If you are unsure, get advice from your local housing advice centre or Citizens Advice Bureau.
  • If all else fails, you may have to apply for a court order to re-enter or take possession of your property. The Shelter.org website gives more information about how to apply for a possession order.

How to evict a tenant

There are three stages to this in most cases:

  1. The tenancy agreement should normally specify a notice period that you can give your tenants to vacate the property.
  2. If the tenants remain in the property at the end of the notice period you can apply to the courts for a possession order.
  3. If you get the possession order granted and the tenant does not comply, you can then apply for an eviction warrant from the county court. The county court will then arrange to send in the bailiffs.

Direct.gov.uk website has much more information, together with useful PDF documents you can download.

What to do about deposit disputes

If you are letting using an Assured Shorthold Tenancy, you are obliged to put your tenant's deposit in a Tenancy Deposit Protection (TDP) scheme. Each TDP scheme offers a free dispute resolution service to help agree how much of the deposit should be given back.

If you want to make a deduction from your tenant's deposit, you must be able to prove that the damage was the tenant's fault. This can be achieved through an independent inventory conducted at the outset and at the end of the tenancy.

You should also be able to back up why you need to deduct the amount – get quotes for any cleaning or repairs needed. You are unlikely to get the result you want if the dispute boils down to your word against the tenant's.

What Next?

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Disclaimer: This information is intended solely to provide guidance and is not financial advice. Moneyfacts will not be liable for any loss arising from your use or reliance on this information. If you are in any doubt, Moneyfacts recommends you obtain independent financial advice.

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