Monthly Archives: February 2011

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By Claire Rhoades-Brown

How important is your property income to you?

In more cases than not, the income a landlord generates from a second, third or portfolio of properties is often relied on for other means and is not just profit in their pockets. This really means every penny counts and as a landlord it is paramount to you that rent is paid on time and consistently. In the current climate times are hard for tenants and landlords alike, and with inflation rising, incomes are being stretched more than they have been before.  The BBC have stated that nearly 12% of all December 2010 payments to private landlords were either late or completely unpaid.  Although it rarely happens, in extreme cases this can lead to tenants missing multiple rental payments and arrears starting to accumulate. The Guardian has also reported that rent arrears have doubled within the last two years for private landlords.

What happens if your tenant stops paying rent?

In the rare case that things do go wrong and a tenant stops paying their rent this can be extremely worrying for you and become a massive stress both emotionally and financially. The most important thing for a landlord when they are faced with non paying tenants is to find the quickest way to re let your property to generate an income again. If dealt with through court action, this can be a slow and difficult process as often court appointments can be months away. If a tenant is not particularly worried about their credit rating or the adverse effect it will have on them then the process can be even slower.

What can I do to stop this happening?

There is little you can do to stop a tenant paying rent however there are things you can do to help prevent it. It is important to reference new tenants thoroughly and ensure that satisfactory references are received. Castle Estates reference all tenants through a professional referencing company to judge affordability and income amongst other things before a tenancy is started, this can help judge a tenant’s situation before they move into a property.  More is being done to tackle arrears as more support and advice is available to tenants to sort out their finances, the government have now produced a guide to support private tenants who are behind with rental payments. Good communication and management of the tenancy are key to overcoming any problems with rent arrears.

Protect yourself with insurance and a good agent

You can protect your rental income by taking out rental insurance. Most insurance companies offer rent protection and legal cover which means that if your tenant stops paying rent, your income is protected. These policies are often inexpensive to set up and pay for themselves over and over again if you are unlucky and your tenant does stop paying rent. Castle Estates can arrange a policy for you that covers rentals of up to £2500 per month from as little as £53.00 for six months cover. You can call Castle Estates at any time to ask for advice on any of these policies as we would happy to help and advise you.