Currently viewing the tag: "court order"

Tenant evictions increase because of severe rent arrears

as rents and utility bills rise

Rise in Tenant Evictions

Rise in Tenant Evictions

UK landlords are well aware that continuing to house tenants that are already in rent arrears can be a costly exercise, unless swift action is taken to evict them.

Hiring eviction experts can help speed up the eviction process of these non paying tenants and using eviction experts should avoid the case being thrown out of court due to minor inaccuracy or mistakes in the required paper work.

Landlords are moving faster than ever to evict tenants who fall into rent arrears according to the latest figures from Sweet & Maxwell, the leading legal information provider.

Any tenant more than two months behind on their rent is classified as being in severe rental arrears. The number of tenants affected by rent arrears rose nearly 5% during the last quarter of 2012.

Continue reading »

Tenant Eviction - How Landlords should do it

Tenant Eviction – How Landlords should do it

Landlords Need To Know How To Handle Tenant Rent Arrears

As many UK landlords already know, there are always some issues that can arise during the course of a tenancy. These can vary from essential repairs to rent arrears and with the UK still slowly recovering from a double dip recession, money is tight all around.

With this in mind Legal 4 Landlords offer landlords some sound advice on dealing with tenants in rent arrears before being forced to take legal action for the eviction of the defaulting tenant.

Some tenants are still struggling financially and many are increasingly finding it hard to keep up with their monthly rental payments as well as dealing with the increasing cost of living. Many tenants experience problems due to changes in personal circumstances, such as redundancy or pay cuts, rather than intentionally refusing to pay rent.

Having to pay the mortgage on rental property and not receiving the rent is stressful for all landlords without Rent Guarantee Insurance, but when a tenant is having difficulty paying the rent, there are still a number of options open to landlords before having to resort to eviction.

  • Try to resolve arrears with the tenant to avoid time consuming and often costly court proceedings, especially if they have generally paid in full and on time.
  • Discuss a realistic payment plan with your tenant and encourage them to pay what they can each month to keep down their arrears, confirming everything you agree upon in writing
  • Seek a money order via the Small Claims Court which will order the tenant to pay back the money they owe. This can happen at any time during the tenancy and you do not need to ask your tenant to leave. If the money order isn’t settled within 14 days then your tenant will have a County Court Judgement (CCJ) entered against their name and the order can be enforced via the courts. (Remember that if your tenant is genuinely not in a position to pay then this may be slightly unfair as you will only be worsening their position).

If the tenant still refuses to pay up or insists that they can longer afford the rent, then landlords must follow the legal process for eviction of the tenant in order to recover possession of their rental property.

Serve Notice To Quit

The benefit of an Assured Short-Hold Tenancy (AST) is that the provisions make it much easier to evict a tenant than other tenancy agreements.

Briefly, there are two ways of serving notice to quit when your tenant has fallen into arrears.

1. Section 21 – end of tenancy possession

Section 21 enables a landlord to gain possession at the end of a tenancy without providing reason. There are two types of Section 21 notices: the Section 21(a) notice for possession of a periodic tenancy (that is, when the fixed term of the lease has expired and not been renewed); and the Section 21(b) notice for possession of a fixed term tenancy.

With the Section 21(a) notice for a periodic tenancy, you must provide notice of two months’ or the amount of time between rent payments (e.g. 3 months for quarterly payments), whichever is greater.

If you want to serve notice at any point during the fixed term of the tenancy, you must serve a Section 21(b) notice. As with Section 21(a) you must provide at least two months’ notice, however the earliest date on which the tenant must vacate the property cannot be earlier than the last day of the fixed term of the lease.

Note: you must have secured the tenants deposit in one of the 3 government approved tenancy deposit protection schemes otherwise the Section 21 notice could be invalid.

2. Section 8 – fault based possession

Unlike Section 21, the Section 8 notice can be served at any point during the tenancy. However, it is a lengthier process so it is advisable only to use this route if you have more than 3 months left of the fixed term.

There are 17 grounds on which you can claim fault based possession, 8 of which are mandatory i.e. if the landlord can prove these then the court must give possession. Rent arrears falls under the mandatory ground 8 as well as discretionary grounds 10 and 11, all requiring two weeks’ notice.

If the tenant refuses to vacate and/or hasn’t paid their arrears after the notice period has elapsed, you will need to apply to the court for a possession order and/or a money order.

Legal 4 Landlords can handle all aspects of debt/rent recovery and are the UK’s leading specialists in tenant evictions.

Under a possession order, the court sets a date for the tenant to vacate the property after which they can be forcibly removed by bailiffs.

UK Landlords are warned not attempt to evict tenants themselves or they could face legal action for unlawful eviction and landlords should always use the professional services of an eviction specialist.

Eviction numbers increase as tenants struggle with finances

Evictions for Rent Arrears Increase by 10.2% This Year

County court closures are being blamed for prolonging tenant rent arrears eviction hearings

The number of tenants in severe financial difficulty has climbed by 10.2% in the first quarter of this year according to the latest tenant arrears tracker by Templeton LPA, part of the LSL Property Services plc Group.

Almost 8,800 more tenants were over 8 weeks in arrears and facing the threat of eviction than there were in the last quarter of 2011.

In the first quarter of 2012, an average of 94,400 tenants in England and Wales were in severe arrears, an increase of 20% compared to the same period in 2011.

The figures were affirmed by specialist landlord service provider, Legal 4 Landlords, who handle an average of 20 tenant evictions per day across the UK.

Legal 4 Landlords spokesman Sim Sekhon said: “At the current rate of growth, the number of PRS tenants facing arrears greater than 8 weeks will climb above 100,000 in the next quarter. Tenants have been facing increasing financial pressures due to the state of the economy and the rising cost of living and unfortunately landlords without rent guarantee insurance have been suffering the most”.

Although severe rent arrears cases have continued to increase, PRS tenancies in severe arrears only represented 2.4% of all properties in the private rental sector (PRS) in England and Wales in the first quarter of 2012.

Overall tenant arrears have improved, with 9.3% of all rent either late or unpaid by February 28th, a decrease from 10.7% at the end of 2011.

Paul Jardine, director and receiver at Templeton LPA, said: “While the general tenant population has absorbed the rising cost of renting in the last two years, a minority of tenants are facing severe financial difficulties, a minority that is growing. These tenants have been pushed into deeper and deeper arrears by a combination of rising living costs, high rents and a weak labour market, and are now months behind with the rent cheque. In turn, these severe rental arrears figures have been inflated by the ongoing impact of county court closures. The closures have prolonged arrears cases, with landlords less able to gain court dates to quickly remove non-paying tenants. This is creating a backlog of tenants in extreme arrears, increasing the amount of rental income lost for landlords or their appointed receivers of rent. Despite the recent surge in severe arrears cases, overall tenant arrears have performed remarkably well given the challenging economic environment. In fact, as we often see at this point in the year, more financially robust households are now paying down post-Christmas debt and putting their finances in order, which is helping to reduce the overall level of tenant arrears.”

The annual growth in tenant arrears has been matched by a yearly rise in the number of tenants being evicted by court orders.
In the last quarter of 2011 some 24,702 tenants faced eviction notices, an increase of 9% on the 22,634 in the last quarter of 2010, although the figures reported are 4% lower than they were in the third quarter of 2011.

There Will Never Be A Better Time To Invest In Property

MyPropertyPowerTeam.co.uk helps property investors and landlords build their own property power team to enable them to profit from property - Visit our main site now!