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  • Writer's pictureGavin Rothwell

Contracts - The Legal Stuff

The Legal Stuff

Great, you and your friends have found your perfect student house! The next stage is to deal with the paperwork side without getting bogged down or bamboozled by all the technical jargon. This blog post is aimed at helping you to navigate at least some of those issues.

Full of enthusiasm you meet your Landlord or Managing Agent often slumping into trendy looking office furniture in their open airy office, you are offered a cup of tea … and they bring out a large pile of forms. Your initial mood is replaced with a sinking feeling followed by a nervous out of my depth and surrounded by sharks feeling. Well it’s true, there is a bit of paperwork. After all you are about to be entrusted with 300,000 pounds worth of someone’s property, so I guess we can understand that. The most important part is feeling like you are in control of the process. Here a little knowledge goes a long way.

The first thing is usually an application form along with a Privacy Notice. Since the recent upgrade to our data protection legislation courtesy of the EU’s General Data Protection Regulations (GDPR for short), all companies are bound to tell you what data they will collect about you and how they will use it. The idea here is to make data collection transparent and to avoid unscrupulous people from selling your data to a third party without your knowledge. The application form itself can vary widely but is likely to be used to check your background so expect your current & previous addresses, employers, and past landlords to be on the agenda. The agent or landlord will also require details of anyone who might be guaranteeing your rent payments. This is likely to be particularly relevant to student tenants.

The other thing most landlords will want to verify is who you are. This will require some sort of recognised photo ID like a passport, drivers licence or national identity card. You will also be asked for documents confirming your previous address, which may well be your parents address. This step is necessary for the Landlord to perform background checks and make sure that he can legally rent the property to you. That might sound a little confusing. You like the property you have money, so what’s the problem? The problem, although only a small one, is the right to rent legislation brought in during 2017 which requires Landlords to check that you are either a UK citizen or are in the Country legally and are eligible to rent a property.

Credit checks are often performed on tenants or in the case of students their guarantors. Their purpose is simply to give the Landlord or agent a good idea of whether or not you are able to pay the rent. A credit referencing agency will provide details of your credit history, overall credit score which is a kind of risk factor showing if you are a good potential client and most importantly County Court Judgements (CCJ’s in Agent lingo). A CCJ is likely to be a red flag and may result in rejection as a tenant or a guarantor so if you know you have one it pays to have either extra security, if you are a tenant, or an alternative guarantor.

Guarantor agreements are very common and providing they are signed prior to the contract are considered legally binding in court. A guarantor should have sight of the contract as well as the guarantor agreement will bind him or her into paying a sum as detailed in the contract.

There are a few types of tenancy agreements but the appropriate one for shared student houses is a Assured Shorthold Tenancy Agreement. These agreements are pretty standard and will guarantee a minimum term of 6 months. The contract can then either be written to a fixed date or can run on a monthly basis. The Landlord will have to give you 2 months notice if he or she wishes to get the property back and you will have to give them one month’s notice. Sometimes tenants get worried about Landlords terminating agreements. In practise unless you are in serious breach of the contract this is very unlikely. No Landlord is going to want a house he can rent out for months on end. The contract will stipulate the terms which are often split up into the responsibilities of the landlord and the responsibilities of the tenant.

In broad terms Landlords will be responsible for the maintenance and upkeep of the property, ensuring it is safe and fit for habitation. If the contract is for a furnished property, the landlord will supply all furniture and white goods for the kitchen. It’s best to look round the house and confirm whilst on your viewing which articles come with the house and which belong to any current tenants. Most landlords will provide an accurate inventory that will detail this explicitly.

Tenants are responsible for paying the rent, and looking after the property, disposing of rubbish and keeping the property clean. They must also tell the Landlord if there are any maintenance issues, failing to do so could leave you open to charges. Tenants are expected to behave responsibly and not cause a nuisance to other tenants or neighbours.

It’s a good idea to be aware of joint tenancies if you are going into shared student accommodation. This is an where an Assured Shorthold tenancy is set up for a group. Because the group will be sharing kitchen facilities, bathrooms and probably a lounge area the Landlord needs to ensure that these are properly looked after. The answer to this is a joint contract. In such a case all members of the contract are equally liable for damages and rent. This is intended to encourage tenants to look after the property and if they don’t it, and no-one owns up to the damage it allows Landlords a mechanism to recover the money for damaged property.

This might sound a little alarming but in practise the phrase “fair wear and tear” is applied to properties. This means that the landlord has to consider dilapidation from normal use before resorting to more drastic legal means. As an example; if there are some marks on walls or furniture this is considered fair wear and tear. If, however someone had scratched “Dave was here!” into the table the Landlord would be wanting to have a word with Dave!

That brings us to the deposit. The vast majority of Landlords will ask for one. This is usually one month’s rent possibly a little more. We understand that this can make the first month, a bit expensive. The purpose of this is to ensure that tenants ‘do not do a runner’ and leave the Landlord without paying the rent. I am occasionally asked if I can take the last month’s rent out of the tenant’s deposit. The answer is no. The reason for this is that the deposit also covers damage to the property. So, Dave would lose some of his deposit in the example above, enough to repair or replace the table with a similar one. If damage is not apparent until after the tenant leaves then it can be very difficult for the Landlord to get their money back, so the deposit is returned within 14 days of the end of the contract.

Now hang on a minute, I hear you cry. What is to stop the Landlord running off to the Seychelles … or at least Bournemouth, with my deposit. Well that is where deposit protection comes in. The government instituted deposit protection in 2013. There are a few government licenced schemes to protect deposits and they are either custodial or insurance based. In an insurance-based scheme, the Landlord pays a fee to insure your deposit. If he or she runs off with it, the deposit will be returned to you by the scheme and the Landlord faces heavy fines. The custodial scheme allows the Landlord to give your deposit to the company running the scheme itself. They hold it and return it to you at the end of the tenancy. In both cases you are given a certificate and extensive contact details as well as scheme rules so that you can verify this has been done correctly.

I hope you have enjoyed this blog. It is intended to be informative and helpful for Students & Young Professionals who are new to renting shared accommodation.

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