How to minimise the risk of rent arrears
As the number of tenants in rent arrears reaches its fourth highest level on record, landlords are being advised to run background checks on any new tenants.
In the first three months of the year, the number of cases of severe rent arrears increased by 4,000 to 94,000. While many tenants will have fallen into arrears unexpectedly due to unforeseen circumstances such as unemployment or redundancy, there will undoubtedly be a significant number of bad tenants who, with a good understanding of the laws surrounding the eviction process, will look to exploit the system and refuse to pay their rent.
Inexperienced landlords, including those who have ‘accidentally’ fallen into the letting game, are particularly vulnerable to these experienced charlatans.
However there are many ways to minimise the financial risk of rent arrears; the first of which should be done before the tenancy is even agreed. Solicitor and Head of GW LET, Rob Denman, explains:
“Landlords should carry out a series of checks into any potential tenant before they let out their property. As well as getting references from previously landlords, it is also increasingly advisable to run background checks on the applicant including credit reports and identity checks. Such information can prove pivotal in avoiding letting property to a tenant who has had trouble with debt.
“Sadly though, nothing is foolproof particularly in these financially rocky times and even the most conscientious tenant can find themselves in rent arrears. Should this occur a landlord must act immediately in order to mitigate the financial implications.
“GW LET offers landlords specialist legal help and advice. We are highly experienced in the eviction of tenants - a procedure which many landlords wrongly presume is quick and straightforward. This assumption could actually result in the tenant being able to claim compensation against the landlord, even if they are in arrears.”
Content correct at time of publication