Non-payment of rent - how to proceed?

[marksmith]

Hi all,

Sorry if this is asked a lot - haven't managed to find quite the info I'm looking for either on here or at the C.A.B. web site. Citizen's advice say there's info on their website, but there simply isn't - there are links to sites but they also don't seem to have it.

Sticking to facts:

I am a LL with a house in England, let on a 12 month AST in June 2009. They signed up with a guarantor (home-owner). Nov09 rent didn't come until mid Dec09, when I received two part-payments which nearly (not quite) cover Nov09 rent. Nothing since - so all of Dec09, all of Jan10 and some of Nov09 in arrears. In a few days it will be all of Feb09 too.

They have recently applied for, and been granted, housing benefit. Four payments made to them, one and a bit passed on to me. I applied to HB office a few weeks ago for this to be paid direct to me, but that takes time.

I hav spoken to lead tennant about this a few times - various explanations and assurances of payment (hence 3 months of grace from me), but to date, nothing. £1500ish in arrears (bit more than 2 months). Will be £2200ish in a few days' time.

A few days ago I wrote to them, detailing the "account", asking for full payment within 15 days (very leanient I thought) OR a payment schedule (for me to approve) detailing how they will pay rent and repay arrears (even more leanient, I thought).

If they do the above, great, lovely, sorted.

If they don't, where do I go next?

Is it second letter (copied to guarantor) then section 8 notice to quit? Or would it be a court summons against tenants and guarantor?

Once housing benefit is coming directly to me (which it should do - not aware of any reason it wouldn't), there's some benefit in not evicting them - void period etc. Would be better to keep the money coming in regularly and look at recovering arrears from guarantor (or tenant, unlikely).

Thanks very much!
-Mark

[jeffrey]

1. Ignore whether rent comes from HB, T's earnings, T's rich uncle, or whatever.
2. If T owes two months' rent or more, simply serve Notice under s.8 of Housing Act 1988- grounds 8/10/11.
3. After two weeks, begin possession proceedings.
4. Er, that's it.

[JK0]

I think I would have involved the guarantor much earlier.

Suggest you write to him asking him to bring rent up to date. Also send a copy to tenant.

[jeffrey]

1. Ignore whether rent comes from T's HB, earnings, guarantor, rich uncle, or whatever.
2. If T owes an amount that equals or exceeds two months' rent, simply serve Notice under s.8 of Housing Act 1988- grounds 8/10/11.
3. After two weeks, begin possession proceedings.
4. Er, that's it.

[marksmith]

Thanks both.

So a Section 8 is the way to go, thanks.

Recovering the arrears is my next concern. I agree, jamesknight0, that I should have got in contact with the guarantor sooner. In fact I should have done a lot of things sooner and not been placated by (ultimately empty) promises... but too late for that now.

So how do I set about recovering the arrears? Given that there is a guarantor, I feel this is not a lost cause. County court? Is it just a standard county court claim, money owed by one party to another, or is it special in some way being a tenant-landlord arrangement?

Thanks!

[JK0]

You still have to write to the guarantor before you sue him. He may be a perfectly reasonable person who has no idea of the trouble his relative is in. (At least this is what he will tell the court if you don't contact him first.)

[westminster]

So how do I set about recovering the arrears? Given that there is a guarantor, I feel this is not a lost cause. County court? Is it just a standard county court claim, money owed by one party to another, or is it special in some way being a tenant-landlord arrangement?

Thanks!
Not special, just a straightforward claim for a debt. Send a letter before action detailing the arrears/periods of rent unpaid, give a deadline to pay (2 weeks plenty), and say you will issue a county court claim if payment isn't received. Send first class with a free certificate of posting to prove delivery, and keep a copy of the letter. Claim can be issued either using Money Claim Online or Form N1 at your local county court.

If the debtor doesn't pay the CCJ here are the enforcement options
http://www.hmcourts-service.gov.uk/infoabout/enforcement/index.htm

If it's your first time issuing a claim, buy a copy of Patricia Pearl's 'Small Claims Procedure: A Practical Guide', 2008, sold on Amazon.

[JK0]

Further thoughts here: (Sorry to be a pest.)

1.) Make tenant and guarantor aware of arrears. Give them say 14 days to bring rent up to date.

2.) If no luck, issue a 'Notice Before Action'. This should give them another 14 days.

3.) Sue jointly. Then if tenant doesn't pay, you can still chase guarantor.


NB, as tenant and guarantor are effectively the same person in this case they should receive all notices and letters in duplicate.

[westminster]

Further thoughts here: (Sorry to be a pest.)

1.) Make tenant and guarantor aware of arrears. Give them say 14 days to bring rent up to date.

2.) If no luck, issue a 'Notice Before Action'. This should give them another 14 days.


No need for letter 2). Letter 1) is enough as a letter before action.

[marksmith]

Thanks all. Lots of replies, all good information and opinions.

I have already sent one letter, allowing 15 days. This went only to the tenant, and stated that the second letter would go also to the guarantor. (Our tenancy agreement states that they'll get two, second one also to guarantor, so I want to stick to this, to give no room for dispute.)

My plan was to allow only 7 days from second letter. (The tenancy agreement says that legal proceedings will start "shortly after" the second letter, it's longer than the advice here suggests, and they've had AGES already anyway.)

I am now wondering whether it would be better to forewarn the guarantor now, or wait until the second letter. It seems reasonable to forewarn the guarantor - she probably genuinely doesn't know - BUT my first letter said I would tell the guarantor with the second letter. I don't want to add confusion, don't want to give them any margin for saying I reneged or generally messed them around.

Any thoughts?

Thanks,
M.

[JK0]

I think the convention is to allow someone at least 14 days before suing them, as they may be on holiday.

It would be silly to waste money suing someone if the guarantor was willing to pay all along, woudn't it?

[Snorkerz]

As a section 8 notice is a warning that you'll take legal action in 14 days then I think you could send that in lieu of the 2nd letter.