We live in tough economic times, with hidden debt crippling households across the length and breadth of the UK. Rent arrears have also risen across both private and public sector nationwide, with people owing an estimated £336 million to local authorities alone as of 2017.
The issue of tenants not paying is particularly troublesome for private landlords, some of whom rely on rental payments as their sole source of income.
With this in mind, liaising with tenants and ensuring that they pay on time remain key elements of successful landlord management. So, here are some steps to increase your chances of securing your rental payments on time.
1. Understand Why Tenants Aren’t Paying
We live in an age where tenants are often demonised, whether they reside in social housing or at the lower end of the private rental market.
However, there are numerous reasons why a tenant may not be paying rent, and it’s important to understand these in detail before plotting your next course of action.
To achieve this, take the time to sit down with your tenants and discuss the issues that they’re facing, whether their circumstances have changed or they’re struggling with an ill family member.
By talking through the issues at hand, you’ll be able to build trust and potentially strike a viable payment plan that suits both parties going forward.
2. Know your Legal Rights and Educate your Tenants
As a landlord, you have a legal right to charge rent to tenants who reside in your property, whilst there’s also a requirement for these payments to be made on time.
You also have a legal responsibility to maintain your property and provide a safe living environment for your tenants, however, and failing to meet this can lead to disputes and ultimately the cessation of payment.
At this stage, tenants occasionally think that they have the right to withhold rent if there’s a contractual dispute or concerns over the condition of the property.
This is fundamentally flawed, however, and explaining this to tenants may encourage them to continue making rental payments whilst the conflict is resolved amicably.
3. Invest in Rent Guarantee Experience
Even if you have known and trusted tenants, circumstances may arise where they struggle to pay their rent.
One way to negate this risk is to invest in rent guarantee insurance, which is sold by service providers such as HomeLet and provides a much-needed lifeline in instances where tenants are unable to pay.
This type of coverage is essentially rent protection insurance, which provides a genuine safeguard and can help to ensure that you continue to receive a source of income should the unexpected occur.
Whilst this requires an up-front investment, of course, it offsets some of your risk as a landlord and can be worth its weight in gold over time.