Financial worries top the list of concerns for many renters, flatmates, lodgers, and landlords now that COVID-19 is a prominent part of life’s landscape. Chief among money woes is worry over whether everyone can make rent – and whether or not landlords will take a sympathetic stance.
For now, lodgers and tenants can breathe a temporary sigh of relief if they find themselves unable to pay rent, as the government is providing some tenant protections during the COVID-19 pandemic. Even when a tenancy agreement or lodger agreement stipulates consequences if rent isn’t paid on time, landlords may not suddenly evict tenants during coronavirus.
Renters are protected by a 3-month buffer period
On 26 March, 2020, the Government enacted measures to protect tenants from eviction during coronavirus. All grounds for possession are covered, as are most tenants throughout London and other sectors of England and Wales.
Under the law, landlords must give renters three months’ notice of intent to end tenancy for any reason including eviction. After notice has been served, the landlord must wait three months to start the court process. For now, the extended buffer period is applicable until 30 September 2020. The law allows the Government to extend both the buffer period and the September 2020 endpoint if necessary.
In addition, a suspension of ongoing evictions has been set in place for a 90-day period that began on 27 March, 2020. If needed, the Government may opt to extend this protection as well.
Some evictions may be allowed despite COVID-19 measures
In Coronavirus Act 2020 and renting Annex A, the Ministry of Housing, Communities & Local Government outlines technical guidance for landlords, stressing the importance of specifying grounds for eviction and requiring at least three months’ notice for all types of possession grounds. Landlords are allowed to apply to the court for a possession order if tenants do not leave by the date specified. On a case-by-case basis, application may be made for either the standard possession process or the accelerated possession process.
For section 21 notices under assured shorthold tenancies, landlords can only ask tenants to leave if a fixed term tenancy has come to an end or during a periodic tenancy with no fixed end date. The three months’ notice of intention to seek possession still applies to Section 21 notices.
At the same time, the Government urges landlords to work with their tenants and lodgers, stating that “We strongly advise landlords not to commence or continue proceedings during this challenging time without a very good reason to do so. It is essential that we work together during these unprecedented times to keep each other safe.”
Rent isn’t cancelled
Even though there are serious limitations on landlords’ ability to evict tenants while emergency COVID-19 measures are in place, tenants are still responsible for paying their rent. This means that everyone who has the means to pay rent should do so on schedule.
Renters and lodgers aren’t on their own. If you are a renter whose income has been adversely affected by the coronavirus lockdown, you may be eligible for financial assistance under the Chancellor’s worker support package. Nearly £1bn in renters’ support has been allotted under the plan, with the aim of keeping renters out of arrears.
Landlords are protected, too
Just as landlords are barred from evicting tenants without ample notice, banks are being asked to help shoulder the load. Landlords who find themselves without rental income can ask for support from their lenders. Among Government measures aimed at protecting renters and landlords is a three-month mortgage payment holiday for those with Buy to Let mortgages.
UK Finance urges loan recipients not to cancel direct debits without first notifying their lenders. The mortgage holiday is intended to help, but arrangements must be made beforehand. Furthermore, guidance from UK Finance states that “Landlords are expected to pass on this relief to their tenants to ensure that they are supported during this time.”
Mortgage payment holiday protocols
Payment holidays aren’t a form of loan forgiveness. Instead, they are a set period of time during which loan payments may be put on hold when necessary. Property owners seeking relief via the UK mortgage payment holiday scheme must apply with their lenders. Many lenders offer details and payment holiday applications online.
The current COVID-19 mortgage payment holiday is eligible to buy-to-let landlords who are up to date on mortgage payments, and who have tenants who have lost income due to the impact of coronavirus. No documentation is required; instead, landlords must simply self-certify that their income has been adversely impacted by COVID-19.
UK Finance gives lenders the option of offering a payment holiday to landlords who are behind on their mortgage payments, depending on individual circumstances.
Furthermore, there is a three-month buy-to-let possession moratorium, which began on 19 March 2020. No homes will be repossessed during the moratorium, although lenders may issue a formal demand to make their customers aware of impending possession proceedings.
UK Finance reassures landlords and other homeowners with mortgages that “Firms will treat customers sympathetically and consider their circumstances on a case-by-case basis.” Plans for repayment will be made individually as banks strive to support consumers and prop up the economy.
What tenants and lodgers can do
Whether you’re sharing a flat or renting an apartment on your own, it’s a very good idea to approach your landlord if you know (or suspect) that you won’t be able to pay the rent on time. Even though renters are protected from eviction during coronavirus, you can rise to the occasion by working out a plan for paying past due rent once you’re able to do so.
As an example, you might be able to offer partial rent for the time being, and your landlord may agree to let you spread any missing payments out over several months once lockdown comes to an end and life starts to look more normal.
Although this conversation might be difficult, notifying your landlord ahead of time will give them an opportunity to seek relief for their own mortgage if needed. In turn, they can pass that leniency on to you.
Whether you are a landlord, a tenant, or a lodger, there’s help. Communication is key and by agreeing to uphold our obligations in the months to come, we can reassure and support one another as we navigate the uncharted waters of COVID-19.