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Government Unveils Tenant Protection Plan

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Government unveils tenant protection plan

The government has unveiled plans to legally protect tenants whose homes are at risk of repossession.

The plan follows estimates from Communities and Local Government that as many as three thousand households could be evicted with little or no notice from their landlords in the event of a repossession this year.

Housing minister John Healey wants vulnerable tenants to receive two months' notice to vacate the property, to allow them sufficient time to find suitable alternative accommodation. He is also calling on mortgage lenders to use alternatives to repossession, such as appointing Receivers of Rent to collect rent and manage occupied properties.

The protection plan is in addition to the new extension to the notice given to tenants, which requires a possession hearing to give tenants up to seven weeks' warning of an eviction.

Healey says: "It is wrong that through no fault of their own these families can find themselves out on the street with little prior warning. That's why I want to change the law to give new protection to those tenants who have no rights when the property they live in is repossessed.“

According to the CLG, a range of charities and advice centres have reported a rise in requests for help from tenants facing eviction because their privately rented home is being repossessed. These include a lone parent with two children who had been renting a property for 10 months, who returned from a holiday to find the locks had been changed and there was a notice announcing that a possession order had been made.

Another reported case involves a man suffering from cancer, who first heard of his landlady's repossession when he received a Notice of Eviction from the bailiffs. He was assured by his landlady not to worry as it was all being sorted out, but bailiffs evicted the client and changed the locks before he could remove his possessions, which included his medication.

As part of the government’s efforts, it is investing £130m in providing free face-to-face debt advice services between 2006 and 2011. It claims that over the past year over 100,000 families have received information and advice about their mortgages from councils and citizens advice bureaux.

Further, the CLG has doubled funding for 76 court desks across the country offering free on-the-day advice and representations for those threatened with repossession.

James Rowlands, policy project manager for the Royal Institution of Chartered Surveyors, says: “Tenants in the private rented sector are often the unfair victims when landlords have properties repossessed. Extra legal protection will help prevent good tenants, who have always paid their rent on time, from being forced out of their homes.

“The two-month notice period is particularly welcome as it will give people the time to find a new property rather being faced with immediate eviction or a matter of days to find a new home. Government action needs to ensure that tenants are protected from the worst effects of repossession.â€

He adds: "These measures highlight the urgent need for effective regulation across the whole of the private rented sector including the registration of landlords and regulation of all letting agents."

AKA a big heavy government shackle of the unplannedlords across the UK.

Meh.

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Alternatively, award the victim tennant £5k compensation from the landlord (with the tenant at the front of the queue for money in front of the bank) and give the landlord 5 years inside for fraud.

The result will be the same for the tennant but will prevent said landlord doing it again.

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The bit I don't like is 'He is also calling on mortgage lenders to use alternatives to repossession, such as appointing Receivers of Rent to collect rent and manage occupied properties.'

:angry: These houses need to be repo-ed and sold for a pittance!

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Hang on, how's this any different from the existing Assured Tenancy Legislation? :unsure:

Section 21 notices served during the fixed term of the tenancy

Section 21 of the Housing Act 1988 as amended by the Housing Act 1996 requires that the landlord provides tenants of an Assured Shorthold Tenancy (AST) with a minimum of two months' notice in writing, stating that possession of the property is sought. The two months starts when the tenant receives the notice not when the notice was written/posted.

A Section 21 notice must be served before possession order will be issued by a court. Possession under this section of the Housing Act 1988 cannot take place during the fixed term of the tenancy, but the notice can be served at any time during the fixed term provided the tenant is given a minimum of two months' notice. The tenant is not required to give up possession of a property until a minimum of two months after the Section 21 notice to quit was served. This includes Section 21 notices served up until the last day of the fixed term.

http://www.tenancyagreementservice.co.uk/s...ice-to-quit.htm

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The bit I don't like is 'He is also calling on mortgage lenders to use alternatives to repossession, such as appointing Receivers of Rent to collect rent and manage occupied properties.'

:angry: These houses need to be repo-ed and sold for a pittance!

Yes, but not at the expense of kicking tenants out onto the street.

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Housing minister John Healey wants vulnerable tenants to receive two months' notice to vacate the property

So you have to be "vulnerable", presumably as judged by social services ?

I smell more spin and no effective action, once again.

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The bit I don't like is 'He is also calling on mortgage lenders to use alternatives to repossession, such as appointing Receivers of Rent to collect rent and manage occupied properties.'

:angry: These houses need to be repo-ed and sold for a pittance!

This is definitely the point of it , but dressed up as help for tenants. Our government's primary function these days is the manipulation of the housing market. The thought of a flood of repo's gets their sphincters twitching.

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Hang on, how's this any different from the existing Assured Tenancy Legislation? :unsure:

http://www.tenancyagreementservice.co.uk/s...ice-to-quit.htm

The existing legislation says two months from the next rent due date, which could mean up to three months. After that, they can apply to the court for an eviction order, and that takes time. Generally you can get around six months to find another place if you use all the right delaying tactics.

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The existing legislation says two months from the next rent due date, which could mean up to three months. After that, they can apply to the court for an eviction order, and that takes time. Generally you can get around six months to find another place if you use all the right delaying tactics.

Interesting, thanks.

But I still don't see how the "announcement" in the OP is anything new.... other than new spin on the existing legislation. Or am I missing something?

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Yes, but not at the expense of kicking tenants out onto the street.

the best way to help tenants is to let this dam break. The end justifies the means.

the thought of a government controlled housing market purgatory lasting years gives me the collywobbles :o

Edited by Giraffe

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Interesting, thanks.

But I still don't see how the "announcement" in the OP is anything new.... other than new spin on the existing legislation. Or am I missing something?

The existing law is the obligations of the landlord. The landlord must give 2 months notice.

However, the bank is not the landlord. If the landlord defaults on his mortgage payments, then the bank can take posession of the house. The fact that there is a tenancy agreement is nothing to do with the bank - that's the landlord's problem.

The landlord is still obliged to house the tenant, but without a property, there's nothing he can do except renege on the tenancy agreement, and face being sued by the tenant. When the bank takes repos, it is because the court has granted an order for 'possession' - in other words, it doesn't matter who is in the property, the bank can walk in and take over.

In practice, in order to protect the tenant, banks will tend to recognise tenancy agreements between landlord and tenant, provided that they have given consent for subletting (which may include an BTL mortgage contract). In the event of a landlord default, banks will tend to honour the agreement on behalf of the landlord, but as this comes at extra risk and delay, they may charge the landlord a higher fee for the privilege.

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Hang on, how's this any different from the existing Assured Tenancy Legislation? :unsure:

http://www.tenancyagreementservice.co.uk/s...ice-to-quit.htm

The tenant has always had rights. The requirement that the bank has 'vacant possession' is always assumed by the bank and landlord to mean that the tenant has to vacate immediately. However without a Notice To Quit served in the proper way (usually two months in advance), the tenant has no obligation to leave and the Housing Act 1988 defers to the Protection From Eviction Act 1977.

That last Act provides a criminal offence and custodial sentence for anyone trying to remove the tenant (be it the bank or landlord) without this due process. Therefore if the bank just comes knocking one day, my recommendation is to let them know the police are on their way.

Just to clarify.

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The existing law is the obligations of the landlord. The landlord must give 2 months notice.

However, the bank is not the landlord. If the landlord defaults on his mortgage payments, then the bank can take posession of the house. The fact that there is a tenancy agreement is nothing to do with the bank - that's the landlord's problem.

The landlord is still obliged to house the tenant, but without a property, there's nothing he can do except renege on the tenancy agreement, and face being sued by the tenant. When the bank takes repos, it is because the court has granted an order for 'possession' - in other words, it doesn't matter who is in the property, the bank can walk in and take over.

In practice, in order to protect the tenant, banks will tend to recognise tenancy agreements between landlord and tenant, provided that they have given consent for subletting (which may include an BTL mortgage contract). In the event of a landlord default, banks will tend to honour the agreement on behalf of the landlord, but as this comes at extra risk and delay, they may charge the landlord a higher fee for the privilege.

Aaaah, go it! Thanks Chumpus, it's been a long day...

The tenant has always had rights. The requirement that the bank has 'vacant possession' is always assumed by the bank and landlord to mean that the tenant has to vacate immediately. However without a Notice To Quit served in the proper way (usually two months in advance), the tenant has no obligation to leave and the Housing Act 1988 defers to the Protection From Eviction Act 1977.

That last Act provides a criminal offence and custodial sentence for anyone trying to remove the tenant (be it the bank or landlord) without this due process. Therefore if the bank just comes knocking one day, my recommendation is to let them know the police are on their way.

Just to clarify.

Aaaah... now I don't got it! :D

Edited by sossij

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The government has unveiled plans to legally protect tenants...

Grrr! Split infinitive! Mieow! Hiss!

Housing minister John Healey wants vulnerable tenants to receive two months' notice to vacate the property, to allow them sufficient time to find suitable alternative accommodation. He is also calling on mortgage lenders to use alternatives to repossession...

Once again, NuLab doesn't get it, and I suspect deliberately. He's assuming that all tenants under threat of repo are in that situation because their LL is defaulting on the mortgage. If the LL owns the property outright and the tenant is about to be evicted because (s)he's defaulting on the rent, that's irrelevant.

The two case studies then cited below are a smoke-and-mirrors job, designed to deflect attention from the fact that OOs who default on their mortgage are entitled to help from the taxpayer, whereas private tenants are not. Added to which, legally compelling banks not to repo BTL properties in mortgage arrears (i.e. in cases where the tenant can still pay the rent but the LL cannot pay the mortgage) costs the government nothing, whereas helping tenants in trouble comes with a hefty price tag.

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Interesting, thanks.

.

But I still don't see how the "announcement" in the OP is anything new.... other than new spin on the existing legislation. Or am I missing something?

To clarify, the AST is invalid and void as the landlord did not have the legal authority to sign it, as he had a pre-existing legal agreement with the bank, as part of the terms of his residential mortgage, that he wouldn't rent out the property.

So basically the AST is worthless and the tennants have no rights.

The most the tennants can do is sue the probably bankrupt landlord for signing a contract in bad faith.

It's not even breach of contract as the contract itself is void.

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