A lot of landlords view their tenancy agreements to be something of an extravagance. A gruelling necessity that attorneys insist upon.
Many believe the most beneficial tenancy agreement is the one with the least amount of words – and are unsure of what’s in the agreement because they’ve not read it!
I hope this isn’t the case for.
What is the reason a tenancy agreement is vital?
Tenancy agreements will help you avoid certain problems and penalties that could be imposed on landlords who do not take the proper care. A well-drafted contract could save you cash and heartache!
Do you require an agreement on tenancy?
It is not required to sign an agreement on tenancy in order to form the Tenancy.
If the term of your lease is shorter than 3 years you’ll be able to make a legally legal tenancy by simply giving the keys away and collecting rent when your tenants have been moved in.
In reality it is true that not having an agreement on tenancy is not a good choice for a variety of reasons, including:
Tenants will be allowed to pay rent arrears, not in advance, as it is their right when there isn’t a provision for rent to be paid in advance.
It is not your responsibility to be in a position to take deductions from the deposit of your tenant – since it is the tenant’s money , not yours. The sole reason landlords can deduct rent is that tenant has signed an agreement allowing the deduction;
If you do not have an express forfeiture clause in your lease, you will not be able to expel tenants in any way for the duration of their lease.
If you’re not sure there are additional things tenants are in a position to perform when there’s no provision in your lease to prevent them:
Keep a pet
Re-decorate the house in the way they would like
Sublet to lodgers, or Airbnb “guests” (which could result in landlords in violation of their mortgage or lease);
– Switch the utility provider without notifying you.
Do you require a correctly drawn Tenancy agreement? Click here for a tenancy agreement template…
However, you must be aware that those four things (keeping pets, etc.) could be something that tenants may take advantage of if your clauses are not written correctly.
Under the unfair rules on terms (now included in the Consumer Rights Act 2015) when you’re removing an entitlement that tenants normally enjoy, your clause must allow tenants with the right to seek permission to carry out whatever they wish and that permission won’t be refused or delayed in any way that is unreasonable.
A lot of landlords fail to grasp this in turn (in particular) in particular) invalidate the pet-free clauses by eliminating this phrase. The tenants are then given carte free reign to keep any pet they like!
It is not recommended to alter the tenancy agreement that has been professionally written unless you are aware of exactly what you’re doing!
How to make your tenancy agreement work for you
What can a tenancy agreement do to assist you in observing the obligations of your landlord?
But, there’s more to it than stopping tenants engaging in activities you wouldn’t like. It is also possible to include clauses that help you to adhere to the law, and also protect you from liability if your tenants commit things that would normally put you subject to prosecution.
One of the best ways to do this is to determine who is permitted to reside on your property, in order to ensure you are protected under:
It is the HMO regulations;
the Right to Rent check rules.
If you’ve let your home to four tenants sharing it – specifically, so that your tenancy will not trigger compulsory licensing, you would not want your tenants to bring anyone new to the property.
The property would be brought to the level of HMO license, making the owner liable for fines and prosecution from the city council.
Do you not want you to worry about the Home Office bringing a prosecution or fine you if they discover that someone lives within your property and is not entitled to rent it in the UK.
The best way to safeguard yourself from these scenarios is to list in your contract all who has the right to reside in the property – either as a tenant or an authorized occupier (often called ‘Household members’) and then say that nobody else will be allowed to reside in the house.
If the tenants let another tenant into the property, they are in violation of the lease that gives you the power to file an injunction or eviction proceedings in the event of insolvency.
Additionally plus, you should know that Home Office can hardly fine anyone if you’ve earned the legal right to rent-check all authorised occupiers in the event that the illegal tenant they’ve found is not authorized by you.
What can a tenancy agreement do to aid you in managing your insurance policy?
Another option you can make is to stipulate that tenants are required to inform you when they intend to leave the house empty for longer than X days.”X” is the amount in which your insurance policy will be able to cover the property that is empty.
You can then, if they say they’d like to go on a trip of an entire lifetime for six weeks and your insurance policy allows for 28 days, you can make arrangements for an additional insurance policy.
If they don’t inform you, and due to this your insurers deny coverage for some reason, you’ll be granted the right to transfer the cost on to your tenants to compensate them for breach of the contract (quite an important argument to highlight the importance of a tenancy contract).
A good tenancy agreement is contingent on a variety of variables
We’ve had to deal with some risk regarding not having a lease agreement (having an unprofessionally written one) and also some of advantages from having a correctly drafted agreement.
There are additional nuances to be considered and your tenancy contract template should be specific to the circumstances of your home and the tenancy
Based on the type of tenancy you have, you might require different agreements (e.g. assured shorthold Tenancy agreement);
The way you handle shared property should be included in the agreement For instance, an alternative form of agreement is utilized when you lease rooms within a shared house (e.g. to the purposes of an HMO);
It is essential to ensure that your tenancy contract is current Was your contract amended in the last year to account to the Tenant Fees law?
And then
It is not possible to underestimate the significance of a tenancy agreement. It lays out the rules in which your tenants lease your home.
Be sure your contract is in your best interests and safeguards you appropriately. One day , you’ll be grateful!
