When you can­not make a pay­ment, do not de­lay telling your land­lord

Weekend Argus (Saturday Edition) - - PROPERTY 360 - Your rent, speak up

TEN­ANTS, if you can’t pay quickly, all ex­perts ad­vise.

The first thing you need to do is com­mu­ni­cate with the owner and try to make a plan with him or her, says Her­schel Jawitz, chief ex­ec­u­tive of Jawitz Prop­er­ties.

“The prob­lem is many own­ers rely on the rental to pay their mort­gage so op­tions are lim­ited in terms of help­ing a ten­ant who can’t pay.

“The worst thing a ten­ant can do is to sim­ply ter­mi­nate the lease and move out. This may put the owner in a po­si­tion to re­port the ten­ant to one of the credit agen­cies that own­ers and agents use to as­sess the qual­ity of a ten­ant, which will im­pact on the ten­ant’s abil­ity to rent in the fu­ture,” warns Jawitz.

An­drew Schae­fer, manag­ing di­rec­tor of na­tional prop­erty man­age­ment com­pany Trafal­gar agrees, ten­ants should “quickly ap­proach their let­ting agent or owner (in the event the owner is self-manag­ing) to dis­cuss pay­ment is­sues”.

“Own­ers are gen­er­ally amenable to as­sist­ing when ap­proached early and hon­estly, es­pe­cially in the cur­rent dif­fi­cult mar­ket con­di­tions with low rental in­creases, higher va­can­cies, dif­fi­cul­ties find­ing qual­i­fy­ing ten­ants and es­ca­lat­ing rental ar­rears.

“The ear­lier the ap­proach, the lower the ar­rears, the more op­tions and flex­i­bil­ity are avail­able to make a mu­tu­ally sat­is­fac­tory plan. An ac­knowl­edge­ment of debt (AoD), which is an agree­ment that al­lows the ten­ant to pay off the ar­rears without de­tract­ing from his or her li­a­bil­ity for rent that is due; early no­tice; lower rental in­crease; and re­duc­ing ser­vices costs are all con­sid­er­a­tions to as­sist with cash flow and af­ford­abil­ity chal­lenges.”

Ben Shaw, chief ex­ec­u­tive of HouseMe, an on­line rental dis­rup­tor, says “pro­vid­ing an up­date sooner rather than later when you are not able to meet you fi­nan­cial obli­ga­tions, or when you will pay a bit late, is the best op­tion”.

“This could help pre­vent ad­di­tional charges, but also pre­vents an­i­mos­ity build­ing in your re­la­tion­ship. Given the eco­nomic cli­mate, a com­mit­ment to pay back over time will see many good ten­ants re­tain their rental con­tracts rather than be forced out. Land­lords do re­alise how tough it is out there, and don’t want to go through the has­sle of find­ing an­other good ten­ant.” GARY PALMER, chief ex­ec­u­tive at Paragon Lend­ing So­lu­tions, rec­om­mends prop­erty own­ers im­ple­ment the fol­low­ing as a bare min­i­mum be­fore sign­ing a lease:

Sub­scrib­ing and us­ing prod­ucts such as WinDeed, other data­bases and credit bu­reaus, for in­stance Ten­ant Pro­file Net­work, will re­veal the per­sonal his­tory of your prospec­tive ten­ant, in­clud­ing iden­tity doc­u­ment ver­i­fi­ca­tion, judg­ments against them and com­pany searches, if they are sign­ing the lease in the name of their com­pany.

Do the le­gal search

Do the per­sonal search

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