Once you have made an appointment with your tenant(s) to conduct an interim inspection visit of your property, ideally with tenants present, consider the following:

Tip.1
Make sure you enquire whether your tenant’s personal details are still the same; contact numbers/email address/employment details. Your style of asking this question should be relaxed and just in conversation mode. At least if your tenants leave suddenly, you may have captured updated and useful information. It is worth adding a clause to your tenancy agreement stating that if their details change, to inform you.

Tip.2
Always take your duplicate set of your keys to check that they fit the lock. If locks have been changed, (you cannot stop tenants from changing locks), but at least in an emergency you have access.

Tip. 3
Make a note of the current utility suppliers. I have heard of tenants switching names on bills to the landlord, so to avoid paying them – agents or landlords who are not on top of this get duped easily. By making sure that the tenants sign the interim inspection report on every visit, it just will add as further proof that they were in occupation and responsible for the bills during tenancy.

Tip.4/5/6/7.
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The other day, I approached a new agent for help.  They quickly received an offer from a prospective tenant.  At this point, our normal procedure is that the tenant completes our reservation form with terms, and completes a detailed application form as well as supplying supporting documentation.  As soon as I received the information, alarm bells did ring.  However, one must never assume. As we are specialists in vetting tenants, I do see a number of things from the outset that others would not spot and that includes a high percentage of tenant referencing agencies – who often attend my talks to get ideas on processing.  Without going into too much detail, because tenants who are out to deliberately de-fraud landlords, read articles on the internet.  There were a number of reasons as to why the application was deemed fraudulent.  All tenants sign a declaration on our application form and for any applications that are deemed fraudulent a prospective tenant will lose all monies paid.  That is clearly our terms; you choose to enter into, once you sign and/or submitted your application for tenancy.

The agent that I was working with on this instruction could not possibly understand how this application was fraudulent. Because in the words of the agent, “he produced payslips”!!!!!.   Well I had to educate this ARLA agent, that any document, including passports can be forged.

The applicant later telephoned our office demanding his money back.  He said he did not care if his application was fraudulent. George Ellis Property Services have nothing to hide, we are not con merchants, but I totally will not entertain any tenants who knowingly submit fraudulent applications.  The applicant later went back to the agent to ask if they could help him find another property. Despite the agency knowing the facts on this fraudulent application, the agency said they would. I would like to mention that this prospective tenant was taken to court recently by his current landlord for rent arrears in the thousands (which were never disclosed by the tenant), but there were many other factors that made this application fraudulent. For one, the applicants (joint tenancy) did not work where they stated, and the list goes on.

You see, not all agents are the same and some are just simply dishonourable and greedy. I feel sorry for the next unsuspecting landlord who gets this rogue tenant. What the private rented market should do is ensure this type of tenant is excluded from renting in the PRS and there are ways to do that.  If agents stop being greedy and landlords stop being cheap and pay for a good and thorough service.  Agents should be working to protect their clients, (their landlords) there are too many quotas for staff to achieve results and this makes them throw mud against the wall in the hope that some will stick.

Getting into debt is not a crime, I can work with any tenant who has got into genuine financial hardship – it happens.  But I am not ever going to be desperate enough to compromise, my reputation or that of my company in order to make a quick buck. If you want to ensure you know who is going to be renting your property and they have the ability to pay, call us to do the vetting and checking of your prospective tenants on your behalf, before you allow them to take occupancy of your property. Or book onto our Ultimate Masterclass in Vetting & Checking your Tenants training course, so we can teach you how to.  The introductory price will cease at 5pm on Friday 15 March 2013.

Check Out – THE ULTIMATE MASTERCLASS IN VETTING & CHECKING YOUR OWN TENANTS

However, practical solutions, is what is needed if you are a landlord and one of your tenants has been made redundant.

Assuming you are aware of the fact showing some empathy initially does help, but in the same conversation you need to ascertain how they plan to pay the next month’s rent and thereafter.  After all if you have a mortgage to pay on your buy-to-let and you have been made redundant your lender wants to establish the same thing.

In basic terms they have one of 5 options.

Option 1.

Regardless whether you like it or not, a tenant can seek assistance with their rent through their local housing authority benefits office.  As a landlord you should have an idea what rate is payable under local housing allowance.  Remember that if your tenant is under the age of 35 they will only qualify for a shared room rate.  Ensure you have third party consent.

Option 2.

Are there any savings to dip into that could be used for a short period.

Option 3

Agree to reduce the rent for a specified period of time to give them some breathing space – this works, especially well,  if it is a joint tenancy and only one person has had their job been made redundant.  Always put it in writing.  This option will work best for a landlord who is not cash flow stricken and where they have good tenants and would like to keep them.

Option4.

Use a proportion of their deposit every month for a limited period of time, if you have access to it.  This would aid as a top up solution and their deposit would need to be re-paid back.  Again the option works best if the situation is similar to that in option 3, and you must get a written agreement and the tenants to sign to this.  The down side of this is that your deposit is depleting and therefore,  you must ensure that once the tenant is back in employment this is repaid.  If cashflow is not your issue, you can still ensure you do not miss out on your rent by deducting the agreed amounts at the end of the tenancy.

Option 5

Get the tenant to surrender the tenancy.

With the economic climate still looking uncertain for 2013, if this happened to one of your tenants which option would you choose?

© Copyright 2013 George Ellis Property Services

www.georgeellispropertyservices.co.uk

020 7763 7200

This article is written by Marie Parris who is the Managing Director of George Ellis Property Services – A company that provides lettings, management, consultancy and training seminars.  Marie is a specialist in residential lettings and management and for the last eight years has achieved zero arrears for all managed properties on behalf of clients.  For the last eight years, she has been a speaker at the Landlord & Letting Exhibition Shows held nationally in the UK and has been on the judging panel at the Landlord & Letting Awards Show for the past four consecutive years. Her book, “The Simplified Guide to Letting & Managing Your Own Property” will be published in 2013.  Marie, educates, inspires and empowers landlords who choose to self-let and manage their property without the use of a ¬sub-standard agency.  George Ellis Property Services are members of ARLA (Association of Residential Letting Agents, APIP (Association of Professional Inventory Providers) and Property Lettings Ombudsman.  Marie is a member of PSA (Professional Speaking Association) and is an accredited landlord who continues to self-let and manage her own property portfolio without any rent arrears and a cash positive income.   She has over 19 years of experience

Here are some top tips to follow when a tenant informs you of their intention to end the tenancy, always request that the tenant sends you written confirmation.  Landlords need to respond promptly with a letter/email that should emphasize the condition of how the property is to be returned, amongst other things.  This letter should also state when their last rent was paid/or due and that they are not to use their deposit, to pay their last months’ rent.

Ideally you should arrange a pre-check out inspection visit as soon as possible, as this will give you an opportunity to give your property the ‘once over’ before their scheduled check out date and highlight in an e-mail/letter to them any potential red flags that must be dealt with before they vacate.

On the day of check out, arrange a joint inspection with tenants, or appoint a representative on your behalf to be present.  Never allow tenants to leave without a proper check-out procedure of some sort in place.  By having an effective procedural system you will undoubtedly minimise disagreements that could arise after the tenancy has ended.

Utility meters will need to be read, (to be forwarded on to suppliers later) and capture the tenants forwarding address. Make a note of any deductions or potential deductions on this document – so the tenant is aware and has no nasty shocks later. Don’t be over zealous on issues that could be seen as wear & tear. Understand the difference between what is clearly damaged and what is fair wear & tear. For example; with very young children, you would expect to see hand prints along the wall by the staircase.  If you are in disagreement with your tenant over deductions from a deposit, this will trigger a dispute that will be handled by the deposit scheme provider that you registered the deposit with.  Proof of your claim is by paper audit, that is why it is vital to show you have completed interim inventory inspections throughout the tenancy, have signed photographs and ideally, receipts for items, when purchased that are now deemed as damaged.

Your tenants should sign this document to show they agree with the meter readings and any deductions and also ensure they sign your surrender of tenancy letter.  Make sure you have a paragraph on this letter, that confirms they have removed all their possessions from the property and get them to initial next to this.  By doing this, you will reduce any chances of any legal action being made against you under The Protection from Eviction Act 1977 or Torts Interference with Goods Act 1977.

Once you are satisfied that the property has been returned to you as your expectation, obtain keys from tenant (make sure they are for your property) and do not allow any tenants to return once this check out procedure has been completed.

After “check-in” admin will consist of you returning their deposit, de-register the deposit with the scheme provider and send a final e-mail/letter to the tenant, confirming this, ideally with a statement of any deductions and wish them well in their new home.

You see what some of these agencies fail to remember, is their inefficient actions,  their nonchalant attitude of “it can wait”, lack of passion and plainly just not understanding the basics of the law and how to apply it in their procedures, are some of the negative contributing factors that can put a landlord’s asset  at risk.  If you also have an agent that has a touch of the Green Eyed monster mentality of  “They are doing better than me – so sod them!” God help you!!

For the sub-standard agent, he/she gets their salary regardless, but for the landlord it is not just the cost of missing a few months rent, for some it could be the cost of losing their investment.   Most landlords, typically work full-time, and own one to three investment  properties and decided to invest for a myriad of individual reasons; supplemented income, retirement plan, school fees, to name a few.  We are not rich; we just saw an opportunity and went for it.  In these austere times, most of us are juggling and need rents to be paid on time and management issues to be resolved swiftly and professionally without recourse to law.

I can never understand landlords who are so willing to hand over keys after meeting someone for 20 minutes to look after their property investment.  Normally they come without any recommendation, or even some credentials.  I mean, if you think of the price of that investment would you hand over that amount of money to someone you had just met 20 minutes ago?  All those who say “yes” you need to sit on the “mad step”.

It is interesting to note, in 2010 The Property Ombudsman for Lettings received 6,727* initial enquiry complaints on behalf of their members (7,500).  Their current membership of 9,000 (2011) who register voluntary only make up about 60% of the market share of letting agencies.  Only heaven knows what the other 40% are really up to!

It is time landlords stop settling for sub-standard letting agents and think about the possibilities of doing all of some of the letting and management process themselves and keeping their profits positive.

I have been educating, empowering and inspiring landlords to do just that.  I teach you how to manage your own property, but with an investor mentality.  Remember this is a business and not hobby.  I will show you tried, tested and proven procedures to implement, that will not impact on your time.  My systems are simplified and you definitely do not need to be any whizz on a computer, but you must have one.

For a limited period only, I am offering the first 4 people who book on one of our seminars a specially discounted price of £215, instead of £295.  For full details of our seminars, click here.

I remembered Jonathon Ambrose of www.thepropertybid.com as a worthy winner
of the innovation & website category from last year and a nominee this year – but
I did not get to share with you what he and his great team do. He is the brainchild
behind this innovative concept, which his profession as a surveyor and also property
investor put together – which definitely got my mark last year.

As you know I am always very keen to bring to the attention of my fellow landlords,
goods and services that assist us and I think this definitely needs a mention to check
out and see if it works for you.

Thepropertybid.com allows the landlord to upload their properties on their site where
prospective tenants can make bids. The landlord will naturally opt for the highest bid
for their property. The benefit is that tenants can make bids at prices they know they
can afford. What makes this service a must to try is that it is free to join!

Remember to satisfy yourself with the vetting and referencing of your prospective
tenants and integrate this as one of the various tools you can use for advertising for
your next vacant rental.

You will only get £85.00 per week, a paltry amount, especially for
London landlords.

What are our options, as landlords;

1. Accept it.
2. Try to negotiate with the tenant to pay the difference (wonder how
if they are not working)
3. Give them notice – and remember any council will advise their
claimants to stay in the property until a bailiff arrives. So this
effectively means, you will need to enforce your section 21 Notice.
This you know takes time and will cost you.

If you have a tenant that is on a periodic tenancy it is probably
wise to act now, if you are planning to go for option 3. Especially,
if you did not take advantage of renewing your contracts before
March 2011.

The upside of this, I believe, is that one bedroom flats will start to rent at
a premium. (in my role as letting agent, I am already seeing this trend

take place, higher rents are being asked for and achieved in many areas
and in days!). So any landlord caught in this situation you may find that
they have a number of tenants eager to rent their properties, as many
professional couples look to downside in these economic times.

For those “Out of London” Landlords, if you can work with £368.00 every
four weeks for your one bedroom flat and your figures tally – you need
not do anything.

All landlords need to remember that the rules came into effect in
April 2011 and there will be a transitional period of 9 months after
the anniversary of the end of your tenancy. The Government are
stating if your tenant came from a hostel they will be exempt All
rates for all property types are affected. Check all your properties
where your tenants are claiming housing benefit to ensure you will
not fall into a shortfall for the first set of landlords who have contracts,
whose anniversary was April this year… you will start to be affected in
December this year!