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Article: Providing you
have done your tenant screening and verifying
properly (see 20
Steps to Successful Landlording) you shouldn't have
problems with rent payments. But, even the best tenants
can have difficulty paying their rent if they fall ill,
or they are made redundant.
In this situation you
could have quite a long period without rent. If you are
heavily mortgaged this is likely to put you under
financial pressure.
It may also be the case
that you need to evict your tenant and spend money on
legal fees to recover lost rent. Councils will not
re-house your tenants if they leave voluntarily, so your
tenant's will be advised to stay put, even if they
cannot pay rent.
Rent Guarantee and
Legal Cover Insurance is good way to protect
yourself from this sort of disaster. It's especially
important for landlords with one or two properties which
are heavily mortgaged - where your investment would be
at risk if you cannot keep up your mortgage payments. If
you have a portfolio of properties your risks are spread
and therefore this type of insurance is less important
to you.
This type of insurance is
relatively inexpensive, usually amounting to no more
than about 3 to 5% of the rental amount.
Before you can get Rent Guarantee Insurance cover your
tenant must be comprehensively verified and must reach a
minimum credit score - see
TenantVERIFY website for more information.
Tenant verifying or screening
is arguably the most important part of a
landlord's or agent's task: it's vital that you get the
pre-letting procedures right - see
Tenant Screening.
Nice car, nice suit, nice
chat - no rent! Don't get caught out -
successful landlords have mastered the art of
selecting their
tenants very carefully. Follow the process of tenant
verifying conscientiously, make NO exceptions and
ALWAYS do credit checks and references - see
www.tenantverify.co.uk
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LandlordZONE® 2006 all
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