Debt Recovery

It's an unfortunate fact of life that some people don't pay up when they should, be they: Tenants, Landlords, Letting Agents, Businesses or Private Individuals.

As in all walks of life, you will come across a small minority of unreasonable people - those who fail to pay their dues or fulfil their obligations, or blatantly go out to cheat.

Alternatively, people get into debt and don't pay their bills largely through no fault of their own: redundancy, family break-up, serious illnesses and just pure bad luck can affect us all. Landlords need to show sympathy and understanding to people in these situations and help them all they can.

Unfortunately, there is a limit to how much help can be given because landlords are not private charities. Try asking one of the major banks for this kind of sympathy and see how far you get.

This can be very irritating and stressful if you are on the receiving end but there is much that can be done to minimise the chances of this happening.

Landlords should screen and verify tenants very carefully - read our guides on tenant screening and follow the rules - without exceptions.

Tenants should be very careful about documentation and make sure the inventory accurately records the true position to avoid deposit disputes later - photographic evidence is extremely useful here.

Letting Agents should always carry out credit referencing searches.

If you are owed money, providing you have acted professionally yourself and this is a genuine debt, there is a lot the law can do to help.

First, you should ask yourself these questions:

1         What is the reason for this debt? If, for example, a tenant has been made redundant, for example, is there any point in pursuing the debt at this time. Would the tenant be willing to leave early voluntarily? Talk over the problem if you can, and sort it out amicably, but don't delay.

2         Am I dealing with a person of straw? You can't get blood out of a stone so don't waste too much time pursuing debts if there's no hope of collecting.

Collecting the Debt 

This information is given from the landlord's point of view but applies equally to tenants and letting agents. 

Once a debt situation has arisen, waste no time in taking action. If a rent due date has been passed or a standing order payment missed immediate action is needed. 

Try to find out the circumstances and try to come to some arrangement with the tenant if it is a temporary funds flow situation. 

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