One of the problems about accepting tenants from overseas is, what do you do if they don’t pay and then go off home? How do you claim your outstanding rent from them?
Usually the only guarantors foreign tenants are able to offer live abroad also.
The problem is often dealt with by requesting payment of rent for the whole fixed term in advance*. However this is only a solution if they then leave at the end of the fixed term owing no more money.
If they stay and fail to pay, or if they leave owing money for damage to the property (for example) what can you do then?
You can bring a claim in the UK Courts (perhaps by applying for an order that the papers be served out of the jurisdiction) but there is then the problem of enforcement. The enforcement procedures in the UK courts are intended for use against people living in England & Wales.
A landlord law member recently told me about of the European Small Claims procedure which is intended for this situation. So I have done a bit of investigation.
The European Small Claims Procedure (ESCP)
The first place I found was a description of the procedure on the Justice website, which you can read about here. This basically says that the system exists and provides links.
The place to go for the forms and guidance on the procedure is >> here. There is an index on the left. To select the country click the ‘courts with jurisdiction’ link at then click the link at the top to go to the map.
Once you have selected the correct country, the rest of the links on the page will then refer to the procedure for that country. For example one of the links brings up the forms you can use.
The coloured index along the top allows you to select pages with other information, for example about enforcing judgements.
Practicalities
Although this looks like a useful way to obtain information about bringing court proceedings in another country, I suspect that in practice it would be a nightmare to actually do it. Particularly if you are unfamiliar with the country, its language or its court procedures.
My feeling is that if the debt is fairly small, it would probably be more cost effective to write it off and move on.
If the debt is a larger one, then probably the best thing to do is to employ a specialist firm to deal with this for you. For example the enforcement specialists Shergroup appear to offer a service which you can read about >> here.
Has anyone actually used the ESCP? How did you get on?
* Although if you do this you need to bear in mind the tenancy deposit and periodic tenancy issues discussed elsewhere on the site.
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