Standing Order
LandlordZONE for Rental Property Knowledge
20th November 2006
 
 
 
  Standing Orders are a great way for landlords to collect rent. They mean that landlords no longer have the time consuming and unpleasant task of tramping the streets and knocking on doors in the hope that rents will be paid.  
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The Standing Order
 
Key Points:
  • Standing Orders allow landlords to automate the process of collecting rents
  • They safeguard tenants in that the landlord cannot change the payment amount, as with direct debits.
  • Rent payments are never late.
  • The landlord knows immediately if there's a problem.
 Quote "If you must play, decide on three things at the start: the rules of he game, the stakes, and the quitting time" American Proverb
  
 
Full Article:
 
Standing Orders are instructions (The Standing Order Mandate) given to a bank or building society to make payments on a regular basis, usually monthly in the case of rents, to a specified party's (the landlord's) UK bank or building society account.

Any person or company with a current account at a bank or building society in the UK can give a standing order instruction.

The Standing Order is similar to a Direct Debt, except that the payer does not have the ability to change the payment amount. In the case of rent, the tenant instructs his bank by means of the standing order mandate what amount is to be paid and when it is to be paid. If there is a change in the rent amount, the tenant will need to instruct his back by means of another standing order mandate.

The bank or building society will, on the day specified in the order, debit the tenant's account and transfer the money through the BACS system to the bank or building society account of the landlord.

Currently (November 2006) the money arrives with the recipient within three working days, e.g. for a standing order initiated on a Monday, the earliest it could arrive will be on the Wednesday. However, standing orders will be processed on the same working day after the introduction of the new faster payments system in 2007.

Banks and building societies will check that funds are available in the payer's account before crediting the landlord's account. The payments enter the automated clearing system known as BACS. The payer's bank submits the instruction on Day 1 when his account is debited. The payment is processed and reaches the landlord's bank on Day 2, which updates its accounts and makes funds available from the start of Day 3.
 
Most current account customers do not pay any charges for standing orders.

Standing Orders are a great way for landlords to collect rent. They mean that landlords no longer have the time consuming and unpleasant task of tramping the streets and knocking on doors in the hope that rents will be paid.

Rents are never late being paid and landlords are warned immediately there is a problem. If a standing order rent payment is not made, it usually means there's a serious problem and one which the landlord can get onto straight away.

With Internet access to accounts the landlord can now monitor when payments are made, or not, as the case may be.

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