Discover Two Ways to Get Rents Paid Early

The problem of getting rents paid early, or at all in some cases, is an age-old problem for landlords, but there are at least two solutions. Every landlord has heard unbelievable stories of why tenants can't pay their rent on time and many seem to be willing to pay a penalty instead of just paying on time.

Some landlords might view these late payers as a benefit because they are actually getting more rents that they planned on when they rented the apartment. However, the next step is for the tenant to pay later and later and eventually stop paying. This leads to an eviction which ultimately costs more than the few extra dollars of late payments the landlord received.

The cost of filing an eviction varies greatly from state-to-state but can easily be from $190 to $500+, and this does not include attorneys' fees. A shrewd landlord will process his own eviction notice and process the case himself through the court system. This works well, especially with practice, until the tenant gets himself an attorney who only represents tenants and who "murders" the landlord in court. Many states allow the tenant to be paid many times their monthly rent plus attorneys' fees if the court rules in their favor. If you haven't heard this already, "Tenants have more rights than landlords", so be careful out there!

So let's look at the problem and two possible solutions. First, the landlord should heed the warning signs of late payments - something is wrong and it may be resolved short-term, but the end result will likely be an eviction. If the tenant is always paying late, work out a bi-weekly or weekly payment plan so the tenant pays as he goes. This generally keeps him from spending his money as quickly as he gets it, and it will give the landlord an early warning signal if there is trouble in paradise. This method actually takes a great deal of stress off the tenant because he doesn't have as much time to be irresponsible as when he only pays every 30+ days.

The other option to get the tenant to pay timely is to give him a discount for paying early. This is a more common practice when investors do lease options, but the rent payment concept is identical. With a lease option, the tenant gets a credit at closing of the purchase of the property for paying timely, or early every month - if he exercises his purchase option AND he has paid timely every month. This money is actually given as a reduction in the purchase price or as a seller credit at closing.

However, when a landlord gives a tenant a rent credit or reduction, the funds come off the amount of the rent due each month. For example, if the rent you want is $850 and due on the first of each month, then your discount program should charge $900 with a $50 discount for early payment, but only if the tenant pays by the 25th of the previous month. If the tenant pays by the fifth of the month the rent is due, he loses his discounted rent completely and starts paying $900 for the rest of his lease. Most tenants like the idea of saving the money more than they worry about paying a late fee or a higher rent.

If you find that an incentive program isn't working and the tenants are paying late, try re-working their payment frequency because they may have a problem with when and how often their employer pays them. If this re-scheduled payment plan isn't working, start serving them with eviction notices as soon as the rent is one day late. Above all else, get any new payment program in writing because the tenant should be evicted if he violates the new terms of the lease addendum and should be evicted.

Dave Dinkel has been a real estate investor since 1975. Dave's focus in the past few years is educating the public in a manner that doesn't' amount to paying for a master's degree. Dave's recent contribution to this end is his e-course called "48 Ways to Create a Massive Buyers List" which can be seen at http://www.MakingaBuyersList.com

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Ensure Tenancy Agreements Are Not a Source of Disagreement

Renting any home means entering into a legal agreement - a tenancy agreement setting out the rights, duties and responsibilities of both tenant and landlord.

Nowadays, (since introduction of the Housing Act 1988) most tenancy agreements are what are known as assured shorthold tenancy agreements (ASTs for short). These 'assure' the landlord that he or she can, if desired or necessary, regain the property at the end of the agreed rental period. They also assure the tenant or tenants that unless there is a serious breach of the tenancy agreement, he, she or they, can remain in residence at the very least for six months.

For this reason assured shorthold tenancy agreements are most commonly for six month periods only. Tenants can then be asked to leave at the expiry of the six months.

Alternatively, when the fixed term expires, the landlord may grant the tenants a further fixed term tenancy agreement, or simply allow them to stay on under the same terms. In such circumstances there is no need for a new tenancy agreement; the tenancy simply becomes a 'periodic tenancy'. Tenants can quit periodic tenancies by giving the landlord one month's notice, and may be required to leave on receipt of two months' written notice.

Tenancy agreements provide landlords and tenants with both the express rights and obligations spelled out in the tenancy agreement (always provided these are not at odds with the Housing Acts, with common law rights, or could be deemed 'unfair'. So, for example, a landlord may not require tenants to give longer periods of notice than is laid down in law, or claim the right to give shorter notice than required).

Irrespective of what the tenancy agreement says, tenants are entitled to the 'quiet enjoyment' of their home and landlords may not demand access without notice or enter the premises when the tenants are not present. Landlords have a duty of care towards their tenants, and tenants have a duty of care towards the property they are renting.

Tenants are also entitled to feel safe in their rented home and to be assured of this by being given a copy of a current gas safety certificate, and (if the property is furnished) knowing that all the furniture provided has appropriate fire safety labelling.

This does not mean that there is one standard form of tenancy agreement, and landlords and tenants have scope to agree a considerable number of the terms included. Perhaps the most important are the rent to be paid, when it is payable, whether in advance or in arrears, whether a deposit is paid, and whether furnishings are provided or not.

Unless stated otherwise, private sector tenancy agreements entered into since February 1997 are automatically shorthold assured tenancy agreements.

But there are exceptions - holiday lets, where no rent or a very low rent, or a rent in excess of 25,000 GBP is charged, where the tenant is a company, or where the accommodation is shared with a resident landlord. For these exceptions, different types of agreement are needed - 'common law' tenancy agreements which stand on their own merits outside the restrictions and protections of the Housing Acts.

In England and Wales, unless the tenancy agreement is to be for a fixed period in excess of three years, the tenancy agreement could be verbal (even so, certain information - about deposits, gas safety and energy performance - must be provided by the landlord in writing). However, a written tenancy agreement is strongly advisable in all cases since verbal agreements are notoriously difficult to enforce.

Tenancy agreements may be between the landlord and one tenant or a number of tenants - for example a couple living together as partners. From the landlord's point of view, two or more signatories to the AST are better than one since each will be 'jointly and severally' liable for the full rent - meaning that if one does not or cannot pay, the other tenant is responsible in law for the entire amount.

Houses can also be divided into multiple tenancies where each tenant has exclusive use of a particular part of the property (say a bedroom) specified in the tenancy agreement, with access to and use of common areas. It makes sense to have multiple rather than joint tenancies where the tenants are not related and may intend to live in the property for different periods.

Tenancy agreements are important documents, enforceable in law, and both landlords and tenants should take great care before signing such agreements. They must be satisfied that the agreement contains only terms with which they are able and content to comply.

Residentiallandlord.co.uk provides a complete online resource for all UK buy to let investors. As well as comprehensive and up to date information there is also a document download centre which includes our much praised downloadable tenancy agreement.

Article Source: http://EzineArticles.com/?expert=Karl_Hopkins

The Tenancy Agreement And Responsibility For Repair And Maintenance

Responsibility within a tenancy agreement

One of the major issues relating to the renting and letting of property is that of maintenance and repair regarding the tenancy agreement. Who's responsible if the roof starts leaking,the central heating system breaks down? Even if the landlord and tenant have a comprehensive tenancy agreement that covers these matters in full, various Acts of Parliament often overrule the tenancy agreement. The law is not contained in any one single statute: it is a mixture of common law (judge-made law) and various statutory provisions designed to deal with diverse matters including tenancy agreements.

Primacy of terms in a tenancy agreement

In common law landlord / tenant liability for repairs is governed by the tenancy agreement. The terms of that contract ( tenancy agreement) may be set out expressly (express terms) or may be implied by law (implied terms). Some of these implied terms are implied by common law, others by Acts of Parliament known as statutory implied terms. The common law implied terms can be overridden by express terms of the tenancy agreement but the statutory implied terms cannot generally be ousted by the tenancy agreement, which makes the statutory implied terms extremely important to the tenancy agreement. It is therefore important for a tenancy agreement to look at:

* The express terms of the tenancy agreement

* The common law implied terms of the tenancy agreement (but bearing in mind that these can be excluded if the tenancy agreement says otherwise)

* The statutory implied terms within the tenancy agreement (bearing in mind that these cannot normally be excluded form a tenancy agreement and will therefore operate despite the terms of the tenancy agreement).

Breach of these express or implied terms within the tenancy agreement is a breach of contract (tenancy agreement) and can be enforced by the parties to the contract, ( tenancy agreement ) i.e. the landlord or the tenant as the case may be.

The tenancy agreement & statutory implied terms

The tenancy agreement may set out clauses which stipulate who is liable for what repair. If the landlord has undertaken within the tenancy agreement to do all the repairs the tenant can enforce these obligations as set by the tenancy agreement. The landlords' liability will depend upon the precise wording of the relevant clauses within the tenancy agreement.

'repair' & 'improvement'

It is important to distinguish 'repair' from 'improvement' within the tenancy agreement. The word 'repair' is confined to the renewal or replacement of subsidiary parts of the building; improvement is adding things to the property that do not already exist. The law does not impose an obligation on the landlord to effect improvements unless he has expressly agreed to do so in the tenancy agreement. Therefore repairing a leaking gutter would be classed as a repair. If the tenant wanted a conservatory that would be classed as an improvement and to my knowledge not many landlords would sanction this work.

If the terms of the tenancy agreement place the repairing obligation on the tenants the question of whether or not this would be enforceable depends on the length of the tenancy and the type of repairs. If a tenant has a periodic tenancy agreement or a fixed term tenancy agreement for less than 7 years, most of the major repairing obligations will be placed on the landlord by virtue of Section 11 of the Landlord and Tenant Act 1985.

Section 11 of the Landlord & Tenant Act 1985

Section 11 applies to leases or tenancy agreement granted on or after 24th October 1961 for less than seven years. The vast majority of Assured Shorthold Tenancy Agreement s are periodic or for terms of less than seven years and therefore Section 11 applies for these tenancy agreement s. The landlords implied obligations under Section 11 are:

* To keep in repair the structure and exterior of the dwelling (including drains, gutters and external pipes) to fulfill the tenancy agreement.

* To keep in repair and proper working order the installations in the dwelling for the supply of water, gas, electricity and sanitation (including basins, sinks, baths and sanitary conveniences) to fulfill the tenancy agreement.

* To keep in repair and proper working order the installations in the dwelling for room and water heating to fulfill the tenancy agreement.

Definition of structure within the tenancy agreement

'Structure and exterior' in the first point are not defined by the Act. However, 'structure' defined in a tenancy agreement clearly includes the main fabric of the dwelling such as the main walls, foundations and roof timbers (including window frames) as distinct from decorations and fittings, while 'exterior' defined in a tenancy agreement has been held by the courts to include paths or steps which forms an essential means of access to the dwelling but not paving in the backyard or a footpath at the rear of the house.

'Repair' within the terms of the tenancy agreement

Condensation is frequently a problem in rental properties and is often disputed within tenancy agreements. This has been exacerbated in recent years by the removal of wooden windows and their replacement with UPVC ones. This has been frequently done without due attention paid to ensuring sufficient passive ventilation. Most tenancy agreement s have clauses within them requiring the tenants to ensure adequate ventilation. However, this is only selectively adhered to. The landlord is then frequently presented with the problems resulting from poor ventilation such as mould or damage to the plasterwork. If the condensation has caused damage to the main fabric of the property, such as the plasterwork, the landlord could be made to repair the plasterwork, but this will not cure the condensation; it will simply repair the consequences of the condensation. If the condensation cannot be cured by 'repair' but can be eradicated only by 'improvements', the landlord is not liable under Section 11 to remedy the problem. Tenants may be able to pursue the matter under the Environmental Protection Act 1990.

The landlord's obligations within the tenancy agreement to repair and keep in proper working order the installations for the supply of water, gas, electricity, sanitation, room and water heating merely require him to maintain and repair the facilities that exist at the start of the tenancy agreement. If the dwelling does not have these facilities tat the start of a tenancy agreement , then there is no obligation on the part of the landlord to provide the necessary installations. Originally, the legislation was confined to installations which were actually within the four walls of the dwelling. However, if the tenancy agreement was granted on or after 15 January 1989 the landlord would be liable for the boiler irrespective of where it was located.

The landlord is liable for these matters under the tenancy agreement, even if the problem is a manufacturers' defect - for example, if the boiler was defective when it was supplied and fitted. He has to put the problem right even if it was not his fault: this is known as strict liability. The only exception would be where the defect is due to some fault on the part of the tenants, who must use the property in a 'tenant-like-manner' to fulfill their tenancy agreement. So if the problems arise because the tenants have not used the property in a tenant-like-manner, the landlord is not liable for repairs to the items in question under the tenancy agreement.

Standards of repair regards the tenancy agreement

Section 11 provides that in determining the standards of repair to the property the courts must have regard to the character and prospective lifespan of the property and the locality in which it is situated. Therefore, if the house is in a poor condition at the start of the tenancy agreement and in an area of very poor-quality housing the landlord will not have to carry out comprehensive repairs under Section 11, nor will he be obliged to carry out improvements. Patching repairs may satisfy the requirements of Section 11, depending upon the circumstances of the case.

The requirement of notice within a tenancy agreement

The landlord is not liable under Section 11 (or indeed under any of the express or implied obligations) unless the tenant has given him notice of the need for repair. So, if a tenant is injured as a result of a defect, the landlord will not be liable under the tenancy agreement for his injuries if he had not been notified of the need to repair the defect.

Common law implied terms within a tenancy agreement

The tenancy agreement may stipulate that the tenant is liable for internal decorative repairs. Quite often, however, the tenancy agreement is silent on this matter. In which case, one must look to the implied terms arising either at common law or under statute.

Unfortunately, the common law is little assistance in the vast majority of cases: If the tenancy agreement is silent, the general rule is that there is no implication that the premises are fit for human habitation or that either party will be responsible for repairs. In other words, the common law is largely neutral. However, there are some minor exceptions for the tenancy agreement which are explained below:

Furnished lettings and the tenancy agreement

In the case of a furnished letting tenancy agreement the landlord warrants (by implication) that the property is fit for habitation at the date when the tenancy agreement commences. Therefore, if a furnished house is uninhabitable because it is infested with insects the tenant can, at the start of the tenancy agreement, immediately repudiate the tenancy agreement, recover any deposit or rent that he has paid and sue the landlord for any damage or loss suffered. However, the tenant must act quickly since this implied term arises only at the commencement of the tenancy agreement. The landlord cannot be compelled to make the property habitable. The tenant remedy is simply to cancel the tenancy agreement and recover his losses. There is no continuing obligation on the part of the landlord to keep the furnished premises fit for habitation.

Tenant's duties to use the property in a tenant-like manner under the tenancy agreement
There is no implied term in any tenancy agreement, whether of a furnished or unfurnished property, that the tenant is to be responsible for repairs. However, the tenant must use the property in a 'tenant-like-manner' under the terms of a tenancy agreement. This means that he must take proper care of the property by doing the little jobs which can reasonably be expected of him from his tenancy agreement, such as unblocking drains, having chimneys swept, mending fuses and so on.

Common parts

In certain circumstances where a tenancy agreement is signed but is incomplete, the court may imply a term, at common law, that the landlord will take a reasonable care of common parts under the tenancy agreement - for example, staircases and other facilities which are shared between various tenants. If the premises consist of a large tower block containing lifts, staircases and other common parts and the tenancy agreement of the individual flats do not oblige either tenant or landlord to maintain the common parts, the court may hold that, since the tenancy agreement is incomplete and the premises cannot function without such common parts being maintained, the landlord must have taken responsibility by implication within the tenancy agreement to keep them in a reasonable condition.

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