Rent Guarantee has Never Been so Important
by Susan Cope. Managing Director, Professional Properties
With events that have unfolded across the globe since the start of the year that have had such a profound effect on our daily lives since March 2020, I don’t believe that there has ever been more of a requirement to take stock and ensure you and your family have the necessary protection in place should a third party have a direct adverse effect on your income.
Expectations are that over 2 million people are going to lose their jobs over the coming months because of the downturn in the economy.
I would like to provide some further information on the Rent Protection and the Rent Guarantee policy that we have been selling for the last ten years.
Is Your Policy Refusing To Pay Out?
A number of companies have offered Rent Protection Insurance over the last ten years with all but a few refusing to pay out during the pandemic. However, many have paid out but then have withdrawn the product from the market meaning that many landlords are finding themselves completely exposed moving forward as their previous policy is no longer on the market.
Fortunately, the Let Alliance policy we have used over the last decade has paid out during the pandemic. Moving forward, the criteria has been amended owing to legislation changes brought in by the government since the pandemic began; i.e. The Section 21 notice period is now three months, with Section 8 notices effectively deferring for the same amount of time.
Should a tenant have an issue paying their rent, then agents have to be seen to be willing to negotiate terms that are acceptable to both the tenant and the landlord. If it is just that the tenant is saying they can’t pay and there is no solution offered, or terms can’t be agreed then the policy would pay out and the relevant notices to vacate would be served by Let Alliance. Landlords would then be covered for the full rent for up to six months or until we have vacant possession of the property (whichever date is the soonest) and all legal expenses up to a total value of £50,000.
Courts are not open until August 23rd 2020 to hear any repossession cases issued on or before the 23rd March 2020 and cases will be relisted in chronological order. Bearing this in mind, it is unlikely that a case would be heard this year from anyone defaulting on their rent from here on in.
Existing Tenancies Can Be Covered
The great news moving forward is that we are now able to offer Rent Guarantee cover on EXISTING TENANCIES.
If your tenant has been referenced by Let Alliance prior to moving in and has a good payment history then it is extremely likely we will be able to offer to add this service to an existing tenancy.
For less than the equivalent cost of a coffee a day, can you afford not to protect yourself.
