Lockdown finance support and options

It has been another tough start to the year for everyone, including landlords, many of whom have tenants that are unable to pay their rent in full (or at all) due to COVID-19. With many already struggling to cope under the tighter restrictions in the UK, we have been looking into what advice and support is on offer to landlords who may not have explored their options yet.

Mortgage Payments

The mortgage holiday has been extended, with applications open to 31 March 2021 and this includes borrowers with a Buy to Let mortgage. Landlords who have been impacted by Coronavirus and have not yet had a mortgage payment holiday will be entitled to a 6-month holiday, and those that have already started a mortgage payment holiday are able to top this up to 6 months without it being recorded on their credit file.

Eviction Ban

Although the ban on evictions has been extended until 21 February (and possibly beyond if reviewed), we would remind landlords that it is bailiff enforced evictions which are banned. Landlords are still able to serve notice on their tenants if they wish. Of course, the notice period is now six months UNLESS in “the most egregious cases”. These include cases involving anti-social behaviour, illegal occupation, death of a tenant where the property is unoccupied, fraud, perpetrators of domestic abuse in social housing and extreme rent arrears, which has recently been revised to include cases where arrears are equivalent to six months’ rent. If you want to discuss your current circumstances, you can contact Caridon Landlord Solutions for advice.

Mediation Service

The government has announced that a new mediation pilot will be launched next month to further support landlords and renters in England and Wales who face court procedures and potential eviction.  Although some landlords are not in favour of mediation as they feel it delays the process further, it can help some landlords and tenants to re-start the lines of communication and come to a mutual agreement which, in the long run, would save landlords thousands in court fees.  Details of the service are yet to be released but there are already mediation services available, such as that offered by Hamilton Fraser. We can direct you to these.

Alternative Payment Arrangements

Since the start of the COVID-19 pandemic, the number of people claiming Universal Credit across the UK has risen from 2.9 million in February to 5.9 in January 2021. Many of these people will be tenants who previously signed up to tenancies based on their current income. Only to now find that their employment status has changed and Universal Credit does not cover the rent they have agreed to pay.

As we have said before, we would really encourage landlords to talk to their tenants and understand their financial situation. It may be that you can temporarily agree a lower rental amount on the understanding that the tenant agrees to an Alternative Payment Arrangements (APAs). This allows the housing element of Universal Credit to be paid directly to the landlord rather than claimants, and have been found to have a significant impact on limiting arrears.

If you are a landlord facing financial difficulties because of COVID, please contact Caridon Landlord Solutions today for some free advice.

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