Tenant Rent Payments
We have been speaking with many of our tenants and landlords who are concerned about the financial impact of the current coronavirus crisis. We understand both parties' concerns and are doing our best to negotiate the best way forward for all.
For landlords, we are advising them to explore options open to them such as rent guarantee policies, mortgage holidays or whether they have a re-mortgage opportunity available to them to reduce their outgoings.
For tenants, we are advising them to be clear about when any rent payment issues are likely to start, the extent of those issues and whether they have anyone else who can help them. Some tenants believe that because landlords have the option to apply for a mortgage holiday that they should not pay rent for this period. However, it is important to note that there is not an automatic payment holiday for landlords and only those who are struggling to make payments because their tenants are unable to pay all or part of the rent as a direct result of the coronavirus will apply for this relief.
We explain to our tenants that a 'rent holiday' is not going to be the best option as this strategy, just like a mortgage holiday, does not mean that the amount of money owed disappears. It continues to build up in the background and will still be due when the pandemic is over (except your monthly payments will increase in order to begin to cover the arrears). Moreover, according to most tenancy agreements, the tenant could also legally be charged interest on those arrears. A rent holiday should be a last resort as it is not the panacea that some believe it to be.
We would advise closely examining what you can afford; what money is coming in and going out? You can then speak to your landlord about a way forward. Reaching an agreement with your landlord as quickly as possible will help in the long term.