We've been contacted by a number of landlords in recent weeks who have stopped receiving money from their lettings agent, without reason. The agent in question is a relatively large one, but is not regulated by associations with as ARLA or NALS. The agent is also not returning phone calls, and their shop is shut. Clearly the agent in question has stopped trading, or is very close to doing so, but where does that leave the landlord, and what should he do?
From a tenancy perspective, I'd recommend the landlord do the following:
What other problems could the landlord face?
What can a landlord do to stop this happening again?
From a tenancy perspective, I'd recommend the landlord do the following:
- Contact the tenant, and tell the tenant to stop paying the agent with immediate effect. This will stop any more money going missing.
- Either appoint another agent and give the tenant the new agent's details, or give his own bank details and contact details - effectively managing the tenancy themselves.
What other problems could the landlord face?
- Where is the tenancy deposit? If the agent has it, or rather doesn't have it, the landlord could have a problem, as he would be liable to his tenant for the full value of the deposit.
- Where is the gas safety certificate for the property? This is really important. The landlord may have a copy, or there should be a copy in the property. If a copy can't be found, the landlord is better off instructing a new certificate himself - office@burges-house.co.uk would assist with this if required.
- Where is the inventory? If the landlord wants to make a claim on the tenancy deposit, he'll need a copy of this.
- Where is the tenancy agreement? The landlord or tenant may have a copy. Legally the tenancy can exist without it, as a tenancy agreement can be verbal. However to prevent disputes between landlord and tenant it's worth getting a new copy signed if one can't be found.
- Does the agent have a set of keys? A landlord should try to recover these.
What can a landlord do to recover the money he's lost?
- Assuming the tenant has paid the agent, but the agent hasn't paid it on, the landlord needs to take some legal advice. I suspect the prognosis isn't good.
What can a landlord do to stop this happening again?
- Quite simply, use an agent who is a member of ARLA (www.arla.co.uk). All members must have their client accounts checked on a regular basis and also have to carry Client Money Protection Insurance - so if the agent is experiencing financial problems, any loss suffered by the landlord is insured.
Richard.
