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Things To Highlight To Your HMO Tenants Before They Move In.
As many you are aware an AST ‘Assigned Short Hold Tenancy’ is the legal contract your tenant signs before they move in to your property.
However like many of us this day and age, the majority of tenants do not read the whole of the contract, like many legal documents they tend to be too long winded and written in a ‘secret language’ that only solicitors understand!
Regardless of this I do recommend that you do take the time to understand the AST you are using, after all you are likely to have more at stake. Google is a great tool for deciphering legal jargon.
……………..what are you waiting for, go and do it!
…So presuming you now do understand your contract I will get into the crux of this article.
For me the actual AST is your last line of defence, it really is only going to help you if you’re unfortunate enough to have to take a tenant to court, this is a really lengthy process, and more than likely is a period of time where you are not receiving rent. However do not dare let someone into your property on a verbal agreement, which would be a sloppy mistake, your laziness, or trust, is going to cost you dearly.
As mentioned earlier, MOST tenants DO NOT read your AST thoroughly before they sign it. I can assure you that some tenants will be unaware of some of the major points within the contract.
Also up to 40% of our tenants come from outside the U.K. Many struggle with the English language, I do have sympathy for these tenants, and if I struggle to understand the legal jargon, they have little to no chance. Make sure they really do understand what they are signing up to.
For this reason I like to highlight, on a separate document the major points of the contract, and these are points that are, in my experience, often overlooked by the tenant. I have the tenant sign their initials next to each point and sign the bottom of the page. This goes with a prompt to call me if they do not understand.
N.B. – I make sure that I highlight on the additional page that the paper in itself is not a contract and does not override the AST. I also write on the paper that the aim is simply to ‘Highlight key points that are often overseen’.
Things that I like to highlight:
I have many tenants in the past who have not understood the notice period within their contract. One of the most common issues being that some tenants will give their notice during the fixed term of the contract.
Please note: Some AST contracts do not require the tenant to give any notice if they intend to leave after the fixed term, I found this out the hard way when a tenant simply left on the last day of their six month contract without a word of notice. To my embarrassment, she knew her contract better than me. Needless to say I changed my AST’s immediately.
I always like to use clear examples with tenants, for example my contracts ask that at least a whole rental month is given. For example if you give notice on the 15th of September then you have to pay for the whole of October…not just until the 15th.
This is a great opportunity to highlight tenant responsibilities such as cleaning up, being respectful to other tenants etc. again giving common examples such as continually not washing the dishes after themselves.
How rent should be paid, when, and the consequences of not doing so.
Some tenants are far too relaxed about paying their rent late. Make sure they understand the consequences of this before they move in. Ultimately action can be taken very early if rent is not paid when it is supposed to, for example, a section 8 eviction notice may be served.
There will also be associated costs for late rent, unfortunately in most ASTs these are minimal, complicated to work out and don’t kick into action for a few weeks.
Fees, deposits etc.
The law is quickly changing in this area, I won’t go into this now but make sure you are up to date with what you can and can’t do.
Make sure the tenants are clear on what a fee is and what a deposit is.
Method of communication
For example reporting maintenance by texting the person who showed them around may not be acceptable, make sure they understand how communication should occur.
Sometimes the method of communication may not be in the AST, but regardless it’s a big issue. If you have some tenants who text, some who call and some who prefer email, then you quickly become overwhelmed and disorganised.
So there you have it, just a few pointers on things I like to highlight to tenants before or at the signing the AST.
N.B. none of the above is legal advice, and it really does pay to get some of your own legal advice regarding your ASTS.
Our approach to HMO and any type of management is a preventive rather than a cure approach, however as always it is not 100% fool proof. Tenants are people and they will make mistakes, become pissed off, and in some cases not really care, but your aim is to reduce the potential of this happening.
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