Tenant with arrears: accept payment plan or straight to MCOL
Discussion
Morning,
Looking for some advice on how best to handle this situation. Will try to keep it as succinct as possible!
This is in England.
We had a problematic tenant who had 8 months of rent arrears. We had a request for a possession order (S21) moving through the courts but the tenant then left of their own accord last week. The possession order has since been issued by the court (including an order to pay the court costs of £355).
The tenant is saying that they want to start a payment plan to repay the arrears, however this tenant has been very flaky in all of their dealings with us so I am unsure how likely this is to materialise. They are proposing £500 per month starting this month.
When they left the property, it was a total mess with lots of rubbish and general bric-a-brac left lying around. Quite a few pieces of furniture on the original inventory were missing and the property needs a deep clean. We have arranged for a clearance, a professional clean and will replace the furniture. We changed the locks at the point they vacated too.
It seemed like the logical course of action would be to start an MCOL claim for the arrears and the various costs incurred (clearance, cleaning, court fees,locksmith fees, replacement of missing furniture), however if their proposal of a payment plan is genuine I'm happy to take them up on that at the rate they're offering.
My question is this: I have read information and forum posts that seem to indicate that agreeing to a payment plan can put a spanner in the works when it comes to making a claim via MCOL later if they stop paying (or don't make the first payment). Is there any truth to this?
Originally my plan was simple: agree a payment plan at £500 per month, then if they fail to make payments in future, raise an MCOL for the remaining balance. However based on what I'm seeing agreeing to a plan could actually prevent an MCOL being accepted later or could be used as a defence against an MCOL claim. I don't want to do anything that would jeopardise that.
I was also thinking that if I go straight to MCOL and they respond with a defence of "But I tried to agree a plan to repay and they did not take me up on it" that could also count against me.
I also don't have a new address for them now, and don't know if they are still in employment so would need to use a tracing agent.
Any thoughts appreciated!
Cheers
Looking for some advice on how best to handle this situation. Will try to keep it as succinct as possible!
This is in England.
We had a problematic tenant who had 8 months of rent arrears. We had a request for a possession order (S21) moving through the courts but the tenant then left of their own accord last week. The possession order has since been issued by the court (including an order to pay the court costs of £355).
The tenant is saying that they want to start a payment plan to repay the arrears, however this tenant has been very flaky in all of their dealings with us so I am unsure how likely this is to materialise. They are proposing £500 per month starting this month.
When they left the property, it was a total mess with lots of rubbish and general bric-a-brac left lying around. Quite a few pieces of furniture on the original inventory were missing and the property needs a deep clean. We have arranged for a clearance, a professional clean and will replace the furniture. We changed the locks at the point they vacated too.
It seemed like the logical course of action would be to start an MCOL claim for the arrears and the various costs incurred (clearance, cleaning, court fees,locksmith fees, replacement of missing furniture), however if their proposal of a payment plan is genuine I'm happy to take them up on that at the rate they're offering.
My question is this: I have read information and forum posts that seem to indicate that agreeing to a payment plan can put a spanner in the works when it comes to making a claim via MCOL later if they stop paying (or don't make the first payment). Is there any truth to this?
Originally my plan was simple: agree a payment plan at £500 per month, then if they fail to make payments in future, raise an MCOL for the remaining balance. However based on what I'm seeing agreeing to a plan could actually prevent an MCOL being accepted later or could be used as a defence against an MCOL claim. I don't want to do anything that would jeopardise that.
I was also thinking that if I go straight to MCOL and they respond with a defence of "But I tried to agree a plan to repay and they did not take me up on it" that could also count against me.
I also don't have a new address for them now, and don't know if they are still in employment so would need to use a tracing agent.
Any thoughts appreciated!
Cheers
For me, I think I'd chalk it up to experience. A real kick in the guts through. But agree to a payment plan and see if anything comes back?
If you have no address for them now, what's stopping them disappearing completely? MCOL or not?
How significant is the sum involved?
You have my sympathy. People are tossers.
If you have no address for them now, what's stopping them disappearing completely? MCOL or not?
How significant is the sum involved?
You have my sympathy. People are tossers.
I'd be sceptical of them suddenly being interested in paying you, when they had 8 months before hand to give you something or talk to you about a payment plan. My guess is they know it can cause problems with the MCOL later down the line or they just hope that doing this will kick the can that bit further down the road. In the meantime, you will just continue to get empty words. They had thier chance, proceed with the MCOL.
Hawkshaw said:
If the tenant has not given you their new address, I doubt if they intend to pay you.
Jordie Barretts sock said:
If you have no address for them now, what's stopping them disappearing completely? MCOL or not?
How significant is the sum involved?
I agree that no address and refusing to give it makes it seem like there's no intention to pay, but they have sent my letting agents 3 emails in the past 3 days repeated asking about making arrangements to set up this payment plan they're proposing, so willing to give them the benefit of the doubt for now.How significant is the sum involved?
They owe approx £12.5k in arrears plus approx £3k in the other fees and putting the property back to the state it was in originally (replacing furniture etc), plus whatever the MCOL fee would be (5% if over £10k so approx £1500).
WRT MCOL & disappearing, as I understand it if you use a tracing agent and they are in employment then the order gets attached to their earnings and deducted directly from their payslip like Tax/NI is. Not sure if that really works in reality but that's what the advice says.
Jordie Barretts sock said:
People are tossers.
AgreedIf they’ve been such a poor tenant then I think it’s unlikely they’ll be paying you anything but it does no harm to try to resolve it.
The important aspect of a payment plan is to ensure you’ve got an acceleration clause to deal with the situation if they miss payments - this is the MCOL issue people will be talking about. An acceleration clause basically states if any payment is missed then all payments under the payment plan become immediately due and payable. If you don’t have this then dodgy tenant correctly says “I only owe 1 payment under the payment plan as I’ve got three years to pay the remainder”
Get an agreement of the amount owed - have the tough conversations now rather than later on.
The important aspect of a payment plan is to ensure you’ve got an acceleration clause to deal with the situation if they miss payments - this is the MCOL issue people will be talking about. An acceleration clause basically states if any payment is missed then all payments under the payment plan become immediately due and payable. If you don’t have this then dodgy tenant correctly says “I only owe 1 payment under the payment plan as I’ve got three years to pay the remainder”
Get an agreement of the amount owed - have the tough conversations now rather than later on.
I'd start the MCOL regardless. If they had any integrity they wouldn't have left owing 8 months rent, their mess for you to clear up, and having removed some of your furniture. Therefore, their offer of a 'payment plan' is probably just to string you along.
So I would get the MCOL filed now, you can still accept some payments from them in the interim that can be deducted from the eventual total. And once you get the CCJ against them, you can always agree a formal payment plan at that point.
Realistically though, you are unlikely to get re-paid as they sound delinquent, but bearing in mind the minimal cost of the MCOL process, you might as well use that as leverage.
So I would get the MCOL filed now, you can still accept some payments from them in the interim that can be deducted from the eventual total. And once you get the CCJ against them, you can always agree a formal payment plan at that point.
Realistically though, you are unlikely to get re-paid as they sound delinquent, but bearing in mind the minimal cost of the MCOL process, you might as well use that as leverage.
Vsix and Vtec said:
I'd be sceptical of them suddenly being interested in paying you, when they had 8 months before hand to give you something or talk to you about a payment plan. My guess is they know it can cause problems with the MCOL later down the line or they just hope that doing this will kick the can that bit further down the road. In the meantime, you will just continue to get empty words. They had thier chance, proceed with the MCOL.
I would agree. Besides, if they could not afford to pay you when living there, how can they afford to pay you now, when they have another property to pay for as well?dukeboy749r said:
Very frustrating for you OP.
Only one point; not all people are tossers. Some can be right tossers, a few can simply be tossers or others can be tossers every now and again.
Most people, I’d venture, aren’t.
Until they are.
Nowt as queer as folk, mind you.
Except in this case they clearly are. Made no attempt to install a payment plan when in the place and arrears, trashed the place and now they've suddenly had an epiphany? Only one point; not all people are tossers. Some can be right tossers, a few can simply be tossers or others can be tossers every now and again.
Most people, I’d venture, aren’t.
Until they are.
Nowt as queer as folk, mind you.
Like Hell they have. It's a stalling tactic for some other nefarious end in their favour. They have no intention of paying anything.
Hugo Stiglitz said:
I'm guessing (possible?) that they need clean references to move into another place so stalling till done then they'll go quiet on you?
Exactly this I’d expect. They are hopefully delaying any smears on their records to ensure they get the next property and start their not paying all over again. I once lived in a property that I was planning to rent out as I was fortunate enough to be able to buy another property with (at the time) my girlfriend (who’s now my wife). We weren’t quite ready to move to the new property but had starting meeting prospective tenants. One couple we talked too seemed like the perfect fit but their only pre requisite was they needed to be in within 10 days. We weren’t really ready for that but moved heaven and earth and moved into our new property and allowed the new tenants to move in. Turns out the reason they needed to be in so soon was he was in court on day 11 for a theft charge from he nightclub he worked at (was the general manager and had a gambling addiction and “borrowed” money from the safe to win back his loss) Knew he was going to get a criminal record and didn’t want it showing. When we eventually found out through an article in the local paper I had many sleepless nights but in fairness he always paid and was a decent tenant.
I’d proceed directly to MCOL if it were me and make sure somebody else doesn’t have to suffer what you’ve suffered
As others have said, they have no intention of paying you they are just fobbing you off.
Even if you start a MCOL and you win, what chance have you got of getting money out of someone who clearly doesn't want to pay, probably owns nothing and you don't even know where they are.
Unfortunately you know they are going to do this to someone else now and know they will get away with it time and time again as it is too difficult for the landlords to do anything and most will just be pleased they have gone.
Even if you start a MCOL and you win, what chance have you got of getting money out of someone who clearly doesn't want to pay, probably owns nothing and you don't even know where they are.
Unfortunately you know they are going to do this to someone else now and know they will get away with it time and time again as it is too difficult for the landlords to do anything and most will just be pleased they have gone.
RazerSauber said:
MCOL. MCOL. MCOL. MCOL. MCOL. MCOL.
MCOL.
They wont pay you if they haven't for 8 months of rent. The longer it draws out, the more chance you get bored of chasing it. Get it all sorted by a court and there's no back tracking then.
I agreeMCOL.
They wont pay you if they haven't for 8 months of rent. The longer it draws out, the more chance you get bored of chasing it. Get it all sorted by a court and there's no back tracking then.
They had 8 months to sort a payment plan and to also choose to not trash your house. They chose neither.
Consider also the practicalities; presumably they are fairly low income. How are they going to afford to pay you £500 per month, plus rent on their new place?
Even if they are genuine about their intention, it just won't happen.
RazerSauber said:
MCOL. MCOL. MCOL. MCOL. MCOL. MCOL.
MCOL.
They wont pay you if they haven't for 8 months of rent. The longer it draws out, the more chance you get bored of chasing it. Get it all sorted by a court and there's no back tracking then.
Here's how this works.MCOL.
They wont pay you if they haven't for 8 months of rent. The longer it draws out, the more chance you get bored of chasing it. Get it all sorted by a court and there's no back tracking then.
1. The OP won't be getting any money.
2. The OP can raise an MCOL, and they can win.
3. See item 1.
IME it's cheaper to write if off, turn the property around and get a tenant in there paying rent asap than it is to try and get money out of a non paying ex tenant even with a MCOL victory on your side.
Gassing Station | Speed, Plod & the Law | Top of Page | What's New | My Stuff