Over the last few weeks, I’ve been helping out a friend. Let’s call them Sam. Sam owns a second property jointly with a family member and have been renting it out for 6 years or so. They pay a Letting Agent to find the tenant and set up the tenancy but do the day-to-day management themselves.
Recently, the tenants have had problems with their income. One of them has been furloughed for some time, and the other made redundant. They have applied for Universal Credit, but it takes a while, and can be a difficult process if you haven’t had to navigate the benefits system before.
They began to miss rent payments, and although they have the best intentions of catching up, it’s becoming a struggle for them to manage on their income.
Sam doesn’t have Rent Guarantee Insurance through her Letting Agent, so this is becoming a financial problem for them too. After conversations with the tenants, my friend has decided to serve them notice to quit the property. That’s when Sam asked me for some advice. I talked them through the eviction process, and what documents would need to be served on the tenants, and what timescales applied.
Then I question Sam some more.
It seems the Letting Agent who set up the tenancy hadn’t fulfilled the legal obligations which would enable a valid notice to be served. Not only would my friend now have some additional legal documents to serve, but they’ll also need to obtain an electrical check (EICR) on the property which has recently come into legislation, which they knew nothing about, and has put them on the wrong side of the law. My friend was stunned that her Letting Agent hadn’t carried out the most basic of procedures to ensure they would be able to end the tenancy when needed. Sam questioned why their Letting Agent hadn’t advised them on the need for an electrical check (EICR)
I explained that there are no regulations currently in place in the Lettings industry, and not all agents will be well enough experienced, trained, or qualified to get these things right.
My friend Sam is getting things sorted ASAP, so notice can be served on her tenant. They will be out of pocket, and currently, due to COVID legislation, a minimum of 6 months notice has to be given, so it may be quite a financial hit by the time it’s over.
Sam has learned a lot from this experience.
*Consider Rent Guarantee Insurance.
*Ask your Letting Agent about their training, experience, and qualifications before you choose who will help you with your investment.
I’m just pleased I was able to help a friend.