Adviser: Landlord repossessions

How do I deal with landlord repossessions?  It very much depends on whether the landlord’s done what he or she is supposed to do!

If the landlord didn’t get the right permission from the mortgage lender or acted outside the terms in the mortgage agreement, your client could be in trouble.

Permission to let

A landlord needs to either have a buy to let mortgage or permission to let from the mortgage lender to rent a property out to tenants.  Getting permission to let might mean new conditions being attached to the mortgage.  For example, some lenders won’t allow landlords to let to tenants on housing benefit.  Others may insist that a minimum monthly rent is charged on the property.

If the landlord has got the right permission to let from the lender and any tenancy agreement complies with the terms of the mortgage the tenant is “authorised” and any existing tenancy agreement should be honoured.  If the landlord doesn’t have the lender’s permission the tenant is unauthorised and your options as an adviser are much more limited.

Dealing with authorised tenants

Antoine, his pregnant wife and his two young children signed a tenancy agreement in November 2012.  Antoine first heard of his landlord’s financial troubles through a summons to court advising him that his home, which he’d been faithfully paying rent on, was subject to possession proceedings.

Antoine’s wife was due to give birth the week after the possession hearing so he was pretty frantic.  Luckily, I was able to find out that Antoine’s tenancy was authorised and he was able to produce a tenancy agreement that wouldn’t expire until November 2013.

We brought this paperwork to the court hearing, which the landlord didn’t attend.  The Master read the tenancy agreement and granted the Possession Order but with the understanding that the Order would not impact on Antoine’s rights to stay in the property until the tenancy agreement expired.  So, Antoine and his newly expanded family can stay in the property until the end of November. 

Unauthorised tenancies 

Not everyone in Antoine’s position is as lucky, if we can call it that. 

Olivia’s case was a different barrel of fish.  She had been renting her home from her landlord for 12 years when she received notification of possession proceedings.  Olivia had signed a tenancy agreement in 2009 that granted her a 10 year tenancy.  However, while her landlord had permission to rent out the house, the lender had attached a condition that the maximum tenancy term that could be offered was 12 months.

Olivia’s landlord’s failure to adhere to this condition made Olivia an “unauthorised” tenant. Despite being sympathetic to Olivia’s situation the Master at the court hearing had no power to insist that the 10 year tenancy be honoured. 

At the hearing I made an application for a stay on enforcing the Order and the Master did issue a 4 month stay which gave Olivia a little extra time to find somewhere new to live.  If she hadn’t gotten any advice the Master may not even have been aware that there was a tenant in the property and Olivia could have lost her home much more quickly.

Top tips

• It’s essential to establish whether the tenancy is authorised or unauthorised – you’ll probably need to contact the lender’s solicitor to get this information
• Encourage your clients to go to court and to let the court know that there are tenants in the property - although this information won't stop a possession order, it may give the tenants more time in the property
• Make sure your client understands who he or she is supposed to be paying rent to.  The landlord is still owed rent while he or she owns the property but this changes once a possession order is made.

Housing Rights Service runs a training course on dealing with Landlord Repossession.  If you’ve missed the course, you can order the Professional Resource, a detailed guide on how to help tenants in this situation.