As a landlord, you may well be used to dealing with tricky tenants who are consistently late with payments but what do you do when a once-reliable tenant experiences unexpected financial difficulty?
As changes have come into place to tackle the coronavirus pandemic, many are experiencing disruption to their level of income. For those already living on tight budgets, this is likely to have already had a major impact on their ability to meet their financial commitments.
How can Landlords protect themselves and look after their tenants? See our tips below.
Applying for a mortgage repayment holiday
If you rely on your tenant’s rent to keep up with your mortgage repayments, you may need to put a hold on your commitments if they’re unable to pay you. To discuss your options, you will need to contact your mortgage lender directly; many are now offering online applications.
Consider if you can afford to help
As both homeowners and landlords alike are offered a 3-month payment holiday to help those struggling to meet repayments, some landlords are considering whether to offer the same favour to tenants. Whether this should come in the form of a payment holiday or a temporary rent reduction will need to be determined by the history of the tenant, your financial situation and how keen you are to keep the tenant on-side going forward. Consider what is realistic for the sake of keeping good tenants and avoiding an unoccupied property in the future.
Understanding your rights
If you know that your tenant is working from home and is still on full pay, but they ask for a payment holiday nonetheless, open up a discussion but reserve the right to refuse their request. You are not obliged to agree to a payment holiday simply because there is a pandemic if your tenant remains financially unaffected by the current situation.
Negotiate a rental payment agreement
If a tenant is unable to meet their rent commitment, then you should speak to the tenant where possible and establish a compromise rental payment agreement. This should be made in writing and formally documented by a legal adviser. If you are unsure how to proceed with any agreement then speak to a legal adviser.
Will my insurance be affected?
If you’re concerned about how any changes will affect your Property Owners Insurance policy, or you want to know exactly what you’re covered for in terms of Loss of Rent and more, just give us a call on 01527 874092. We’ll talk you through anything you need to know.