Are we on the brink of a rent arrears crisis?
The number of tenants who are in rent arrears has risen by more than a third suggest latest figures by the Money Advice Trust charity after its telephone help line received close to 20,000 calls from people unable to pay their rent in the first nine months of the year.
According to the charity the number of calls received on the issue of rent arrears has risen by 37 per cent compared to the same period in 2011.
These figures are supported by the National Debtline; more than half of the calls it receives are from tenants.
Joanna Elson is the Chief Executive of the Money Advice Trust:
“Rent arrears are now the fastest growing debt problem we help people with at National Debtline.
“We are in danger of falling into a rent debt crisis.”
So as a landlord how do you deal with a tenant in arrears? Solicitor and Head of GW LET Rob Denman explains:
“While there is undoubtedly a subset of rogue tenants who deliberately fail to pay their rent, we are seeing an increasing number of tenants who having previously demonstrated a good behaviour now find themselves in financial difficulties and are falling into rent arrears.
“This is a particularly tricky situation. But whilst landlords empathise with their tenants the fact that many rely on the rent to cover their mortgage repayments means their ability to ‘grant tenants a pass’ is often beyond their control.
“As a landlord it is your responsibility to confront the situation as tenants often want to bury their head in the sand. This is why it is vital you maintain good communication with your tenants.
“Set up a meeting to discuss the situation and see if any compromise can be met – if your finances permit it and you wish to continue to let to these tenants perhaps you would be willing to reduce the rent for a short period. Alternatively ask if they have any family or friends who could help them out for the time being.
“However if the situation becomes too strained and the tenants fall into severe rent arrears (two month or more) you can then choose to serve a Section 8 Notice and begin the eviction process. GW LET can assist you with this and ensure you follow the correct legal procedures.”
Content correct at time of publication