What Happens If My Tenant Fails To Pay The Rent?

As a landlord, it’s likely that you’ll be relying on rent being paid on time and in full each month. You may have a buy-to-let mortgage to service, refurbishment costs to finance or other regular costs to consider.

The majority of tenants will pay their rent on time, however there is always a chance that some tenants could fall into arrears.

The first thing you need to do to mitigate this risk is to have a robust and comprehensive tenant vetting process in place.

If a tenant fails to pay their rent during the tenancy, there are a range of steps you can take to try and recoup the lost money and reduce the chances of the situation escalating…

Good communication is crucial

If a tenant misses a payment, the first thing you need to do is to reach out to them, find out why and discuss their financial situation.

This will give you a clearer picture of the full situation and whether it was a one-off or something which could become more serious over time.

Professional and courteous communication can help to build a relationship with tenants and improve the chances of getting back what you are owed.

You can also educate tenants about the government support available to them in the event they can’t afford to pay their rent.

Record everything in writing

Although you may want to speak with tenants in person when they fail to pay rent, it’s vital that you also keep a record of all conversations in writing.

Moreover, keeping digital records of all payments can provide you with a clear picture of who is in arrears and how much they owe.

Written and digital records could also be required if you make a deposit deduction for unpaid rent or need to pursue an eviction as a last resort.

Devise affordable repayment plans

Agreeing a repayment plan with a tenant in arrears is an effective way of clawing back the money you are owed.

If renters have a better idea of how much they owe and when it needs to be paid, they can better organise their finances and pay back manageable chunks of money – reducing their debt over time.

What’s more, if you know what money is coming in and when, you can manage your own cashflow more easily.

Consider ‘Breathing Spaces’

The Debt Respite Scheme – also known as a ‘Breathing Space’ – provides tenants with serious debt problems with additional legal protections.

In short, it means landlords can’t chase unpaid rent for up to 60 days if a tenant has been given a ‘Standard Breathing Space’.

There are also ‘Mental Health Crisis Breathing Spaces’ for tenants who are receiving recognised mental health treatment. In this scenario, there is a longer period in which landlords have to stop all action required to collecting debt.

The value of a professional letting agency

If rent arrears become serious, they can be extremely stressful and have serious financial consequences for landlords. That’s why as soon as a tenant misses a payment, you need to follow the above steps in order to try and resolve the situation as quickly as possible.

A professional letting agency will be able to handle the required communications and put in place the processes which can reduce arrears and stop missed payments from occurring.

This invaluable management service can take the hassle out of letting your property and protect your rental income.As a landlord, it’s likely that you’ll be relying on rent being paid on time and in full each month. You may have a buy-to-let mortgage to service, refurbishment costs to finance or other regular costs to consider.

The majority of tenants will pay their rent on time, however there is always a chance that some tenants could fall into arrears.

The first thing you need to do to mitigate this risk is to have a robust and comprehensive tenant vetting process in place.

If a tenant fails to pay their rent during the tenancy, there are a range of steps you can take to try and recoup the lost money and reduce the chances of the situation escalating…

Good communication is crucial

If a tenant misses a payment, the first thing you need to do is to reach out to them, find out why and discuss their financial situation.

This will give you a clearer picture of the full situation and whether it was a one-off or something which could become more serious over time.

Professional and courteous communication can help to build a relationship with tenants and improve the chances of getting back what you are owed.

You can also educate tenants about the government support available to them in the event they can’t afford to pay their rent.

Record everything in writing

Although you may want to speak with tenants in person when they fail to pay rent, it’s vital that you also keep a record of all conversations in writing.

Moreover, keeping digital records of all payments can provide you with a clear picture of who is in arrears and how much they owe.

Written and digital records could also be required if you make a deposit deduction for unpaid rent or need to pursue an eviction as a last resort.

Devise affordable repayment plans

Agreeing a repayment plan with a tenant in arrears is an effective way of clawing back the money you are owed.

If renters have a better idea of how much they owe and when it needs to be paid, they can better organise their finances and pay back manageable chunks of money – reducing their debt over time.

What’s more, if you know what money is coming in and when, you can manage your own cashflow more easily.

Consider ‘Breathing Spaces’

The Debt Respite Scheme – also known as a ‘Breathing Space’ – provides tenants with serious debt problems with additional legal protections.

In short, it means landlords can’t chase unpaid rent for up to 60 days if a tenant has been given a ‘Standard Breathing Space’.

There are also ‘Mental Health Crisis Breathing Spaces’ for tenants who are receiving recognised mental health treatment. In this scenario, there is a longer period in which landlords have to stop all action required to collecting debt.

The value of a professional letting agency

If rent arrears become serious, they can be extremely stressful and have serious financial consequences for landlords. That’s why as soon as a tenant misses a payment, you need to follow the above steps in order to try and resolve the situation as quickly as possible.

A professional letting agency will be able to handle the required communications and put in place the processes which can reduce arrears and stop missed payments from occurring.

This invaluable management service can take the hassle out of letting your property and protect your rental income.