This is the first post looking at the ten most common tenancy agreement breaches by tenants, as identified by Direct Line in their survey, which I discussed in the introduction to this series.
The Direct Line survey gives the percentage of tenants who fall into arrears as 25% – which is pretty high. One in four tenants are likely to do this.
But what are the consequences for tenants of failing to pay rent?
Increased risk of eviction
There are two main ways that landlords evict tenants –
- via the special ‘rent arrears’ ground (ground 8 in Schedule 2 of the Housing Act 1988) or
- via the section 21 procedure.
To use the rent arrears ground you need to be in arrears of two months or more (eight weeks if you pay weekly) both on the date of service of the notice and on the date of the court hearing. So there is scope for you to go into arrears but keep your arrears at under two months in order to avoid this ground coming into play.
Many tenants do this, but there are good reasons not to. The most important is that your landlord may get so fed up with you that they refuse to renew your tenancy at the end of the fixed term and decide to evict you using the section 21 procedure.
Provided the landlord has set this up properly there is no defence. So if you want to stay in the property long term, it is not a good idea to antagonise him.
Negative impact on your credit rating
So far as I am aware, in most cases, the fact of failing to pay rent per se will not impact on your credit rating. However, if your landlord obtains a CCJ for the rent arrears through the courts,this will. And it will impact on your ability to obtain another tenancy later. Few landlords will want to take on tenants who have CCJs for failing to pay rent.
The prospect of poor references
Not all landlords will take up references (although all landlords SHOULD do this!) but if they do, taking a reference from the former landlord is common. Again, if your landlord reports that you are a poor payer, this will put off most landlords.
Conclusion and advice
If you are renting property, you generally do not have long-term security of tenure. So you need to make sure you do not antagonise your current landlord or do anything which will put off future landlords when they are checking you out.
Having accommodation is hugely important – if you don’t have anywhere to live this can have enormous negative consequences for your life, and for your children (if you have any).
Tenants should ALWAYS prioritise the payment of rent over everything else. If you are worried about spending the money before your rent day – arrange for your rent to be paid by standing order the day after your salary goes into your bank account.
Of if you are on benefit, do everything you can to ensure that the money reaches your landlord. Benefit offices will not normally pay direct to landlords but you can arrange for this to be done via a credit union or Tasker Payment services.
Next time I will be looking at smoking.
NB If you are a landlord whose tenants are failing to pay rent, you will find free guidance here.