13:57 PM, 30th July 2012, About 12 years ago 12
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I recently wrote an article about one of my tenants who recently reported that whilst she was away there was spillage in the bathroom which caused over £500 worth of decorative damage to downstairs ceilings and walls. The article was read by literally thousands of landlords and received a whopping 51 comments.
If you missed the article or would like to read the comments left by your peers it is LINKED HERE.
To cut a long story short (the original article and the comments) my tenants went away for a weekend, relatives were left to ‘house sit’ and when my tenants returned the bath had over-flowed and caused damage to downstairs ceilings and walls. My insurance excess was £500 and I felt that as there was no failure in the plumbing it was not my responsibility to fix the problem and not worth claiming on my insurance. My tenants got the place re-decorated but then claimed they could not afford the rent the following month. For a variety of reasons it was not commercially viable to serve notice (all explained in the original article). I needed to do something so I wrote an email to my brother (Adam) who manages the properties for my entire family. The purpose of this was for him to have something in writing from me when he went to have a chat with my tenant. He’s a very good mediator in these situations.
Adam didn’t actually visit my tenant, instead he decided to write to her and enclose a copy of my email with his letter.
The comments and advice I had received in response to the original article ranged from serving notice, writing off the months rent, adding my tenants to a blacklist, spreading the repayment of the unpaid rent and others which said that I should have claimed on the insurance and that I had no right to make the tenants pay for accidental damage. All valid points of view in different circumstances I’m sure but I wasn’t comfortable with any of them.
The good news is that the letters were sent and the response was payment of the rent.
I’ve not asked why or how but as if by magic the money has turned up. My faith in human nature has been restored. I suspect that my tenant has shown my letter to her relatives and they’ve paid for the damages. After all, it wasn’t my fault the damage was caused and it wasn’t my tenants either was it?
I will probably never know what’s really happened but this experience just goes to show that we must follow our gut feelings and reason with people politely. As I mentioned in my original article, this tenants family have “a bit of a reputation” and I know for sure that a threatening approach would probably have ended badly for them and for me. Instead, logic and reason won the day 🙂
This is the letter I sent to my brother to forward on to my tenants:-
Hi Adam
Thank you for your call this weekend to update me on the flooding problem at XXXXX Close.
As you know, I always believe in treating my tenants fairly.
I purchased this property as a long term investment and unlike some landlords I have no intention of selling to make a quick profit. I also believe in maintaining my properties and keeping rents at a fair level. I don’t make much profit on the rents as it’s all swallowed up in mortgage payments, landlords insurance and the fees for managing the property. For me, it’s a little nest egg for when I retire in 20 years time, hopefully it will have gone up in value a fair bit by then.
I’d like to think my tenants at XXXXX Close realise that I’m a decent chap based on how I dealt with the issues of the leaky roof a few years ago. The problem with the roof was my responsibility, I got it repaired as quickly as possible and I even compensated the tenants by waiving a months’ rent at Christmas for them which I didn’t need to do by law.
It’s clear to me though that the issue of the flooding is not my responsibility as there was no water escape from the plumbing. I don’t know exactly what happened but I can hazard a guess. That’s not the point though, I’m not responsible for getting that fixed and my landlords insurance has a policy excess of £500 so it’s not worth making a claim. Also, I can’t force the tenants to buy or claim on their own insurance.
I understand that you received a telephone call from my tenants sister this weekend to say that no rent will be paid this month due to my tenant having used her rent money to pay for the damage caused to the ceilings. I accept that she doesn’t know how it happened either as she was not there and her relatives were house sitting. Nevertheless, we all agree that it wasn’t due to and plumbing or pipework problems so it must have been an accident. A bath left to over-flow perhaps?
I could of course insist on the rent being paid but I also accept that you can’t get blood out of a stone. If my tenant has used the rent money to pay to fix the damages caused I only have two options really.
Option one – I could ask you to serve a Section 21 notice to gain possession of the house and re-let it. I’d prefer not to go down that route though as my tenants do seem like nice people, they were very patient when we had the leaky roof problems.
Option two – The only other option I can think of is to use the one month damage deposit to cover the rent for this month. For this to happen we will need the tenants to agree to this in writing. The deposit can then be unprotected and used to pay this months’ rent.
I appreciate this is a bit risky as it leaves me with no damage deposit but I need to do something because I need the rent to pay the mortgage, the insurance and your fees for managing the property. I’m not made of money either. If I don’t pay my mortgage the lender could reposes the property and that’s bad news for both me and my tenants. We must avoid that at all costs!
You have my permission to forward this email to my tenants and I look forward to hearing from you.
Regards
Mark
OK, so I gave the impression that I’m also as poor as a Church Mouse and if that’s wrong may God forgive me.
As they say, the rest is history. I’ve got my rent which means somebody has done the right thing and we all live happily ever after 🙂
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Sign Up17:46 PM, 30th July 2012, About 12 years ago
i was under the impression that the deposit cannot be unprotected until the tenancy has finished ie. they have left the property ??? so otpion 2 maybe unviable ???
Mark Alexander - Founder of Property118
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Sign Up18:08 PM, 30th July 2012, About 12 years ago
IF that was the case a landlord would not be able to return a deposit during a tenancy even if he wanted to and even with mutual consent of the tenant. That doesn't sound logical to me but as we know, laws and logic can sometimes conflict. I'd be interested to hear others thoughts on this.
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Sign Up18:53 PM, 30th July 2012, About 12 years ago
Unlogical Mark? Opt 2 leaves a tenancy running with dep unprotetected and used for rent. Dep needs to then be re-instated by Tenant and reprotected by Landlord at a cost of at least time if not £30 if my deposits. Rent is rent and needs collecting - Deposit is for soring problems at the end NOT half way thru a tenancy! comments ?
Paul Shears
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Sign Up19:00 PM, 30th July 2012, About 12 years ago
Mark
You say:
"Also, I can’t force the tenants to buy or claim on their own insurance."
I made it a condition on the tenancy contract that my tenants took out insurance.
They accidently damaged two floors within a few months and informed me.
The insurers (Endsleigh) were a nightmare to deal with for several months for all concerned.
The compromise we struck was;
They paid me the £150 excess on the damaged bedroom carpet & plus another £150 on the expensive £15.50 / sq metre kitchen floooring.
I realised I'd made a mistake putting down vinyl as a replacement could easily be damaged again the day after it is installed.
I paid for new tiles to be laid on the kitchen floor plus I bought several boxes of spare tiles.
This caused the tenants to pretty much lose the use of the kitchen for three days (Rip up the damaged vinyl, re-level the floor, Cut & lay the new ceramic tiles, grout & seal them.
The damaged bedroom carpet will be paid for by the tenant before they leave.
So I was out of pocket on the kitchen floor but I think it was a reasonable compromise.
Mark Alexander - Founder of Property118
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Sign Up19:32 PM, 30th July 2012, About 12 years ago
My logic says that if a landlord chooses to repay a deposit mid tenancy he is entitled to do so. On that basis he would be entitled to unprotect the deposit once it had been refunded. Therefore, if landlord and tenant agree that the deposit can be unprotected and used for rent arrears that's also perfectly acceptable in my mind. If you disagree please point me to the legislation which proves my logic to be flawed.
Joe Bloggs
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Sign Up19:46 PM, 30th July 2012, About 12 years ago
yes, i agree...a hollow victory if the deposit is not made good. and waiving a months rent for the leaking roof seems over generous if it were repaired promptly.
Mark Alexander - Founder of Property118
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Sign Up21:00 PM, 30th July 2012, About 12 years ago
Ah but it wasn't a hollow victory was it? They paid the rent in full and the deposit remains protected. I don't think I was over generous with the roofing problems given that my tenants chose to stay in the property whilst the roof was repaired and the property was re-decorated to deal with the problems caused by the leak. I considered the property to be uninhabitable at the time and offered to pay for the tenants to go into B&B whilst it was being repaired.They preferable to stay put. A months rent cost me a lot less than a month of B&B. The outcome of the latest problem vindicates my decisions in my opinion.
Industry Observer
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Sign Up9:04 AM, 31st July 2012, About 12 years ago
Lot of misunderstanding here on what can or cannot be done in respect of use of the dep[osit part way through a tenancy. My understanding is that it will all depend on the wording in the tenancy agreement as to what the deposit can be used for AND WHEN. Post TDP this is very much the case with TDS who as usual are very prescriptive with clauses a mile long that MUST be inserted in the agreement.
The other two schems are more relaxed, especially DPS, in the early stages.
However Roden is correct try to unprotect a deposit even with the tenant's consent and you will find all three schemes very obstructive.
I would suggest mutual surrender and regrant, this time not taking a deposit if that's how you want to play it i.e. getting that money now.
In terms of arrears it is a very common misconception that the deposit exists only to deal with dilaps and damages at the end of the tenancy. It does not - it exists (back to square one here) to deal with all and any matters as listed in the tenancy agreement. As usual this is the key and post TDP I have to say almost every agreement I have seen from agents and landlords is woefully inadequate in this respect. If you don't say it can be used for arrears, and claim it in a dispute, you are at best 50/50 onto a loser.
As ever take the deposit (or claim it) for dilaps first as these are subjective. The tenant is much easier to pursue for a Money Order for arrears which are black and white and fact - either paid ort not.
Also as usual getting the money out of the tenant even with an Order is of course a different issue!!
Industry Observer
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Sign Up10:05 AM, 31st July 2012, About 12 years ago
Sorry meant to add I hope the tenants don't miss again in two months when trying to repay the family debt, or make good the loss of their own money when faced with other bills.
Mark Alexander - Founder of Property118
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Sign Up10:17 AM, 31st July 2012, About 12 years ago
Me too! However, what I suspect is more likely is that the relatives who caused the damage have paid for the damage to be put right based on my tenant sharing my correspondence with them. Play this one out in your mind and you will probably come up with the same conclusion as me. Tenant comes home, relatives explain accident. Typical human emotion occurs "surprise, panic, blame". Then somebody comes up with a plan, "let's see if we can get the landlord to pay". Plan backfires. Tenant shows relatives what landlord has said and argues "I didn't cause the bloody flood, why should I pay". Relatives pay for damage to keep the peace.