signed 6month contract but wants to leave

[Emma Richards]

Hi guys I need some advice. Basically ive let my flat to a lady on her own.. Apparently she overheard one guy upstairs saying things which involved her. She is now threatening to vacate even though she has been there only 1 month and has signed a 6 month contract. Will she be able to pull out because of the situation that has arose, or does she have to continue to me rent until the agreement is up..?

[Reg]

Sorry to hear your problem.

Basically the tenant IS legally bound to stay (or at least pay) for 6 months if they have signed a standard tenancy agreement.

HOWEVER, whether her story about hearing things is true or not, if she is adamant she aint staying (she could move out suddenly without trace). You could then try and pursue her through court action and try and recover the lost revenue that way, but it could be very long winded, stressful and it wouldn't be certain you would get a pay out.

You're probably better off trying to negotiate some compensation from her (keep her deposit and additional costs for re-advertising) Possibly 1.5 months rent in total, then let her go, and try and get someone else in asap. That way the situation won't linger, unfortunate, but try and resolve a fast amicable agreement.

Be lucky

[Emma Richards]

Sorry to hear your problem.

Basically the tenant IS legally bound to stay (or at least pay) for 6 months if they have signed a standard tenancy agreement.

HOWEVER, whether her story about hearing things is true or not, if she is adamant she aint staying (she could move out suddenly without trace). You could then try and pursue her through court action and try and recover the lost revenue that way, but it could be very long winded, stressful and it wouldn't be certain you would get a pay out.

You're probably better off trying to negotiate some compensation from her (keep her deposit and additional costs for re-advertising) Possibly 1.5 months rent in total, then let her go, and try and get someone else in asap. That way the situation won't linger, unfortunate, but try and resolve a fast amicable agreement.

Be lucky

Thanks so much!! Im very stressed with all (to say the least)..

[Reg]

No worries.

Obviously you need to keep a close eye on the situation from now on and talk to the tenant regularly to see how she is feeling / what she is intending.

If she is adamant that she is going, tell her if normally takes 4-6 weeks to find a new tenant (tell her it was six weeks empty b4 she came along), and you've got tight financial obligations (expensive mortgage) plus the costs of readvertiing, tentant check fees etc.

Once you've told all of your financial concerns, perhaps you could suggest 2 months money in total to let her go, gauge her reaction, if she rcoldly rejects this offer, give it a day or two then lower it to 1.5 months.

Whatever you do, if she wants to leave early, keep the deposit at the very least.

Hope it all works out for you

[Trenners]

Hi Emma,

If the tenant wants to leave then let her go.

I assume that your tenancy agreement does not have a break clause (that lets either party terminate the fixed term agreement with a defined notice period) - so, legally, the tenant is liable for all of the rent until the end of the fixed term.

However it is always best to be pragmatic about these things and compromise is always better than a legal solution. I would tell the tenant that they must continue to pay the rent until you can find a tenant to replace them - and they will also be liable for any advertising costs (keep receipts) that you incur.

Once you have agreed the compromise with the tenant then focus on trying to get another tenant as quickly as possible. Don't be tempted to be greedy and withhold all of the Security Deposit - this practice is the sort of thing that gives landlords a bad name.

When you find a new tenant then you should try and refund as much as the Security Deposit as possible (itemising any deductions, agreeing them with then tenant and providing receipts) less any rent owed.

I've written an "ask the landlord" column on this topic - called I'M A TENANT - GET ME OUT OF HERE - which I will post on the forum tomorrow .....

Good Luck,

Mark "Ask the Landlord" Trenfield

[Pauly]

Regarding the security deposit, I personally wouldn't give her it back, she is messing you about and you need compensating for the trouble she is causing you - both financially and emotionally

[Trenners]

Hi Emma,

The Security Deposit is the TENANTS money. You have absolutely no right - either legally or morally - to make deductions to compensate yourself for being "messed around" or for the "trouble she has caused".

You can only make legitimate deductions that are fair and reasonable from the deposit. ie: Compensation for lost rent, compensation for advertising costs etc etc etc You should provide receipts wherever possible.

I am really pleased that the new Tenancy Deposit legislation is going to get introduced in April 2007 - because this will stop landlords like PAULY helping themselves, unfairly, to other peoples money.

Good luck,

Mark

[Pauly]

I'm also glad that the the new Tenancy Deposit legislation will start next year, but as long as the judicator has an neutral outlook and empathises with the landlord equally.

But until that happens, you've got to protect your interests. You can start off being nice and fair but the odd 'dodgy' tenant here and there soon toughens you up

[Reg]

Yes, you often hear about these horrible, unfair, money grabbing landlords.

There are plenty of undesirable tenants out there too, who sometimes do a bunk / or don't pay the rent / trash your property etc.

However, you tend not to here about these stories, 'cause the pc brigade' don't like to mention them.

[Melboy]

Yes, and I have had my fair share of them as well!

You do become slightly bitter but try not to let that cloud the issue. I did however reduce my rental holdings after having 3 very bad Tenants on the trot and I got absolutely sick of 'em and decided that it was the only way to keep my blood pressure down!

1. One did a Moonlight Flit!

2. One disappeared never to be seen again! leaving all his furniture and rubbish behind plus a loss of 1 Months rent.

3. One trashed the place and then left........skewered him though through the Courts and he actually paid-up before actually going into Court. Still had to recover the property though.

This was all on 3 seperate houses as well in a 12 Month period. I wouldn't mind but I am a bloody good Landlord and my properties are all modern and as good as you will find anywhere and to a high standard.

[Chris Knight]

Sorry to hear about the problems encountered.

In future it maybe worth considering a Rent Guarantee & Legal Expenses policy which are relatively inexpensive (probably less than £200 per property). These normally will provide a Legal Advice line, and if the tenant breaks the Tenancy Agreement the insurance cover will probably kick in to pay most of the lost rent and they take the legal hassle & expense away as well.

[Trenners]

Sorry to hear about the problems encountered.

In future it maybe worth considering a Rent Guarantee & Legal Expenses policy which are relatively inexpensive (probably less than £200 per property). These normally will provide a Legal Advice line, and if the tenant breaks the Tenancy Agreement the insurance cover will probably kick in to pay most of the lost rent and they take the legal hassle & expense away as well.

would these type of policy be provided by leaseguard by any chance ....... <grin>

[Melboy]

A lot of Insurance Companies offer legal and rent protection within the Landlords Property/buildings/contents Insurance Policy.

I might also add it is not as expensive as (up to) £200 per annum. Shop around I would suggest.

Can I just mention that some Landlords rely on rental income as a Salary (so to speak) and that every penny counts towards their budget.

Since the huge growth in BTL lots of small business's have mushroomed offering Landlords all sort of financial extra's which eats into any monthy income.....OK it may be tax deductable at the end of the year but some Landlords are not particularly looking at capital growth for the long term (I'm not) but for steady monthly income.

Now, this doesn't mean I don't spend money on my properties, I certainly do, over £3000 on one property this year alone in upgrades to attract good, solid Tenants......all improvements tax deductable I might add!

I could go on but I expect other Landlords will have a view on this subject.

Mel.

[Reg]

Yes, there does seem to be alot of extra companies who all want a piece of the mullar.

From letting agents to rent protection and from professional decorators to double glazing companies.

So far I've tackled it on my own, adverts, online tenant checks, showing prospective tenants around, inventories etc, it's been a steep learning curve, but one I have learnt quickly (one example, learning that less than a quarter of all prospective tenants bother turning up for viewings, therefore arranging block viewings, just one example. There's still more to learn and I will probably get stung at some point in the future, afterall, it's the law of averages. However, out of these 'professional' firms, I have to say, I would never use a letting agent (only if the property was long distance), after all, they not going to have sleepless nights if your property/properties sit empty, so I figure an individual's personal drive will always be more pressing than any letting agent.

Anyway, getting back to the subject of legal and rent protection it is something I presonally very nearly took up, until I read the small print, most companies take a full months rent as payment, should you need to claim. It's one of those things though, unless you end up needing it, you think it's further reducing my yearly yield along with the other costs. I haven't had the hassle that Mel had with dodgy tenants yet, but if I do, this forum will be the first place I'll be visiting, you guys have been very helpful since I joined up

[GPEL]

I've not come across a rent guarantee product that costs a full month's rent as payment, far from it. There is however sometimes an excess of 1 month's rent should you need to make a claim. Other policies have no excess but cost more upfront. Provided your property hasn't been trashed, the security deposit can be used to offset the excess.

[Reg]

No, what I meant was that if you make a claim, THEN most companies charge a month's rent as an additional payment on top of the standard policy charge. Mindyou, you have a good point that the deposit would cover you should you make a claim. I makes sense to have this type of insurance, although the yearly premuim is still an extra expense, at the end of the day, it's all comes down to affordability, if you can EASILY afford it, then I would say yes, it's about the only optional extra I would consider