Ignore rent protection at your peril
What is rent protection? Just another expense that as a landlord you can’t afford? Or is it a cost that you shouldn’t be without? At Alexander & Co we would like you to make your own decision based on the experience of landlords such as you.
To tell you more about our scheme we asked Stuart McMillan, our Dunstable Manager.
“I’ve been an agent for 22 years working with Alexander & Co, we have always pushed for landlords to consider safeguarding their tenancy with rent and legal protection. Evicting a tenant who is not paying rent can be a very expensive exercise if you’re not protected.
Very early in my career I went to court to evict a tenant who hadn’t paid his rent. The landlady didn’t have any rental legal protection. At court, the case went from hearing to hearing, the landlady had paid over £1,200 to her solicitor to try and get them evicted, and she ended up giving the client money for them to go.”
What is the process of rent collection?
At the start of the tenancy the tenant is referenced by our referencing partners, from the perspective of their income, earnings with their current employer, and also previous landlord references, to try and build a picture. Once passed we can set up the protection for the landlord at the start of the tenancy. That will mean that if they do then fall into arrears, we’ll be able to start the process of getting them evicted.
It’s not very often you’ll have problems in the first six months of a tenancy. Only once or twice have I been defrauded by a tenant moving in who then hasn’t paid their rent, but I’ve been to court on several occasions as a result of the pitfalls of life, where people lose their job. I’ve seen evictions, all the horror stories, but you are covered under the policy if you carry on renewing it from the initial tenancy commencing.”
Why do you think some landlords don’t decide to take out rent protection?
“I don’t think they really understand the actual cost of obtaining back their property. I’ve had various landlords over the years who have said, ‘I’ve never had a problem, we trust your judgment on who you select,’ but at the end of the day, we’re not paying the rent for them, and we don’t know what’s round the corner for people. Anything can go wrong at any moment. The experience of getting your property back is harrowing; it’s best to have as much protection as possible.”
Real life case studies
“We managed five properties for a couple that resided abroad; they didn’t have rent or legal protection. They tried to do things remotely and unfortunately the right processes weren’t followed, if you don’t issue the correct paperwork, in the correct format, the court will kick out the case and you have to start all over again. It could then be another two months before you see a judge again.”
Sophie Moore, Bicester Senior Property Manager, shares what happened to another local landlord.
“I had a case where the tenants had passed reference checks; they were both employed, paid their first month’s rent, and then the second month comes, and they didn’t pay their rent. The rent and legal protection the landlord had kicked in and the landlord was able to seek possession of the property as well as being paid the rent for the arrears that continued to accrue.
With this situation, the tenants were actually in the property for a further five months without paying any rent; we didn’t get vacant possession because there was quite a long wait for the court hearing. So, effectively, if the landlord hadn’t had rent and legal protection he would have suffered a loss of over five months’ rent plus the legal fees.
Our rent protection scheme only costs £16.68 a month and this landlord could have been looking at losing in excess of £5,000 on his income for the year, but because he had the rent protection he didn’t suffer any financial loss at all. We found new tenants straightaway, and he only had a vacant property for three days.
This landlord did everything right, but you just can’t prepare for every single eventuality.”
Alexander & Co Rent Protection
“Approximately 70% of our landlords take us up on rent and legal protection. I’m very passionate about it because I’ve seen first-hand what landlords have to go through without it. It can be an extremely stressful time, the process of winning their properties back.
You hear so many stories about landlords where the court’s decision doesn’t fall in their favour. We’re constantly making sure the contracts are water-tight, and notices are served; if that’s all done correctly then the judge should stand there with only one option and that is to give back the landlord their property.”
Don’t gamble with your rental properties, find out more about our rent protection scheme now.