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b0redom
16th April 2008, 12:27
So I have a BTL property. The same tennants have been in there for 2 years, and are coming up for a 3rd renewal. The agents are demanding their 10%+VAT up front again if the tennants renew despite doing absolutely nothing after finding the tennants in the 1st place.

The contract stipulates that if the current tennants stay in place, or return to the property within 18 months, then I will have to pay the agents fees again.

Is there anything to stop me renting the property to MyCo and then subletting to the tennants? 10%+VAT is obviously nearly 2 months rent!

DimPrawn
16th April 2008, 12:29
Don't know, but no one likes to see an agent suffer.

Moscow Mule
16th April 2008, 12:30
So I have a BTL property. The same tennants have been in there for 2 years, and are coming up for a 3rd renewal. The agents are demanding their 10%+VAT up front again if the tennants renew despite doing absolutely nothing after finding the tennants in the 1st place.

The contract stipulates that if the current tennants stay in place, or return to the property within 18 months, then I will have to pay the agents fees again.

Is there anything to stop me renting the property to MyCo and then subletting to the tennants? 10%+VAT is obviously nearly 2 months rent!

Are they managing the property?

If it's just a recurring finders fee, tell them to ram it and cease all contact with them.

b0redom
16th April 2008, 13:28
No, they've not managed it. I'm just not sure of enforcable the contract is.

oracleslave
16th April 2008, 13:30
. I'm just not sure of enforcable the contract is.

Yoda! Is that you?

bogeyman
16th April 2008, 13:32
No, they've not managed it. I'm just not sure of enforcable the contract is.

Is the tennants' letting contract between you and them, or between them and the agency?

If the agency is not actively managing the property, I'd tell them to sod off.

Dow Jones
16th April 2008, 13:39
So far it's not clear, as there is a High Court case pending. I don't know how good your agent is, however what makes you think that the so-far-good-and-prompt-paying tenants will continue being so when they know they have to deal with yourself? Some people need to be 'reminded' or 'prodded' to pay. Same as going direct with a client, you can get more but also can wait for up to 3 months for payment, as opposed to agency paying you weekly/monthly. Could be time-consuming and stressful. Why don't you offer the letting agency 5% instead of 10% commission and settle half-way at 7.5%? This is asuming it's inclusive of collecting the rent and paying you.

bogeyman
16th April 2008, 13:44
(see below)

bogeyman
16th April 2008, 13:46
Same as going direct with a client, you can get more but also can wait for up to 3 months for payment

Not if payment terms are stipulated in the contract, which they certainly should be, with late payment interest penalties of x% over base rate.

Standard B2B contract stuff.

b0redom
16th April 2008, 13:52
It's a corporate let. I get on well with the tennants, and they've been fine. I don't really think there's a worry about them not paying. The agent doesn't even collect the rent, it comes straight from the company to me.

I guess I'm just looking for the ability to go direct like I could as a contractor/client.

ratewhore
16th April 2008, 13:55
Go and discuss it with the big cheese at said agency. You never know.

PAH
16th April 2008, 13:56
The contract stipulates that if the current tennants stay in place, or return to the property within 18 months, then I will have to pay the agents fees again.



You was a mug to agree to that. Agents are scum and cheeky bastards. Just imagine the laughs they'll have when you hand over their fees for doing absolutely nothing.

The easiest solution is to increase the tennant's rent to offset the agents fees, just don't tell the agent. Doubt they can check what rents are currently being charged if they're not involved in the management at all.

Diver
16th April 2008, 14:32
Don't know, but no one likes to see an agent suffer.

:rollin::rollin::rollin:

tim123
17th April 2008, 11:43
No, they've not managed it. I'm just not sure of enforcable the contract is.

The OFT are currently starting a court challenge to these clause.

If the OFT win then it's not enforcable, if the OFT lose then it is enforcable.

HTH

tim

PAH
17th April 2008, 11:56
The OFT are currently starting a court challenge to these clause.

If the OFT win then it's not enforcable, if the OFT lose then it is enforcable.



Surely the critical point (as with any contract) is it was signed therefore accepted, regardless of the terms.

No point spitting your dummy out because you thought the scenario they covered in the contract wouldn't happen. That's why you have a contract in the first place. If you're not happy about any of the terms, get it changed or don't sign it!

b0redom
17th April 2008, 12:37
Yep. Well I called up the estate agent, and they're not prepared to budge on the 10% + VAT upfront costs, so looks like it's time to sack them off.

beercohol
17th April 2008, 12:52
Yep. Well I called up the estate agent, and they're not prepared to budge on the 10% + VAT upfront costs, so looks like it's time to sack them off.

The trouble is, these days its all too easy to drag someone to court over even a very small unpaid invoices.

If I was the agency (and wearing the agency hat), you'd be hit by invoices and statement of account until I feel ready to fill out very simple Claim Form to the court. It would run though Small Claims, and you'd be hit by statutory late payment interest in addition to the full outstanding amount, plus debt recovery costs (starting at a measly but still annoying £40), and court costs of course (probably £60 or £100 depending on how much they let your debt mount up before coming after you).

NOW WAIT, THATS JUST HYPOTHETICAL, and an exploratory account of what they can do.

If I was you (and had my stuff-the-greedy-agency) hat on, I'd take another look at the contract. There are often some excellent ways of doing this kind of thing without breaching it.

ChimpMaster
17th April 2008, 12:55
Just get new tenants. You'd be surprised how much a council would pay for you to house their tenants, and you get to pick and choose your tenants so they're not all bad. And the rent is guaranteed, with no "commission" taken out.

b0redom
17th April 2008, 13:36
Really? Have any info on how to find out about that?

PAH
17th April 2008, 14:10
Yep. Well I called up the estate agent, and they're not prepared to budge on the 10% + VAT upfront costs, so looks like it's time to sack them off.


At least they're no longer guessing whether you've got the same tennant. :rolleyes:

ChimpMaster
17th April 2008, 14:43
Really? Have any info on how to find out about that?

Call the local council where your BTL is based and ask to be put through to Housing Benefit department. It might be called something else but they'll get the idea - tell them you're a landlord and have a property you'd like to let to the council.

Councils normally have 2 schemes:-
1) They introduce housing benefit tenants to you. You show them around your BTL property, interview and select them. Councils either pay you direct or pay the tenant who pays you - I always prefer direct of course! Councils may not cover the full rent, i.e. if you want £600 they might only pay £550 and tell the tenant to cover the £50.

2) They take the property off your hands on a 2/3/4 year contract. They pay you a rent every 3 months in advance. You have no involvement over the term of the contract, i.e. t hey put in who they want when they want ,and fix all problems with the house (of course everything needs to be OK before they take it off you). They return the property to you in the same condition they took it. Normally the rent is a bit less in this option, but then again you have no hassle for the term.

unemployed
17th April 2008, 17:39
Call the local council where your BTL is based and ask to be put through to Housing Benefit department. It might be called something else but they'll get the idea - tell them you're a landlord and have a property you'd like to let to the council.

Councils normally have 2 schemes:-
1) They introduce housing benefit tenants to you. You show them around your BTL property, interview and select them. Councils either pay you direct or pay the tenant who pays you - I always prefer direct of course! Councils may not cover the full rent, i.e. if you want £600 they might only pay £550 and tell the tenant to cover the £50.

2) They take the property off your hands on a 2/3/4 year contract. They pay you a rent every 3 months in advance. You have no involvement over the term of the contract, i.e. t hey put in who they want when they want ,and fix all problems with the house (of course everything needs to be OK before they take it off you). They return the property to you in the same condition they took it. Normally the rent is a bit less in this option, but then again you have no hassle for the term.

your place will be wrecked with council housing tenants , make sure they pay for any damage.

tim123
18th April 2008, 09:25
Surely the critical point (as with any contract) is it was signed therefore accepted, regardless of the terms.

!

The OFT's case is that this is a B2C contract and that the clause is void under UTCCA 1999, thus it is irrelevent when the term was agreed.

The OFT's problem is that they have already decided that landlords are a business when considering the interface to the tenant, so going to court to argue that they are consumers when considering the interface to the agent is going to get tricky.

tim