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Preventing and controlling rent arrears

It is the tenant’s responsibility under the tenancy agreement to ensure that their rent payments do not fall into arrears. It is the legal responsibility of the tenant to ensure that their rent is paid to the landlord in accordance with the requirements of their tenancy agreement, and there is no legal obligation upon the landlord to remind tenants when the rent is due, nor to chase them for payment. However undue financial hardship to tenants can be alleviated if arrears are identified at an early stage and tenants are given the opportunity to seek specialist advice. To this end, you should develop rent arrears procedures to identify those tenants who have a problem paying their rent and ensure that action is quickly taken to try and resolve the difficulty.

It is important therefore that you review rent accounts on an ongoing basis.

There is a ‘pre-action protocol’ in existence for claims for possession based on rent arrears which is now part of the court rules. This only applies to social landlords and so need not worry you. However you may care to read it, as it sets out procedures some of which you may like to follow, even though they will not be legally binding on you in the same way as they are on council and registered social landlords.

>> Triggers for arrears

The reasons for arrears are many and varied.  It is important to recognise the warning signs and intervene promptly and effectively but also sensitively.  

Some common triggers are:

  • Change in relationships
  • Change in circumstances, death or job loss
  • Tenant may be making a ‘counter claim’ for disrepair

If rent is not paid the landlord is able to take action to obtain possession of the property through the courts, or to use a number of other legal remedies to obtain settlement of the debt.  Obviously, it is in the landlord’s interest to obtain payment of rent rather than possession of the property and, therefore, comprehensive procedures can be developed to not only remind the tenant when rent is due, but to encourage payment and to provide as many payment options and arrangements as possible.

>> Options to recover arrears other than prosecution proceedings

Possession proceedings are potentially costly and may want to look first at other forms of recovery.  However, this does not mean that possession proceedings should be delayed whilst other options are explored. 

The main options available, other than or along side possession proceedings are:

Non-court related options: Arrears may be pursued by letters, phone calls or visits, however although a certain amount of chasing is acceptable, you should not do anything which can be construed as harassment.

Court related options: You can bring a claim in the small claims court for a county court judgement (often referred to as a CCJ) for the arrears. 

If the tenant contests the claim you will normally need to complete a long form, called an allocation form, so the case will be assigned to the appropriate court procedure which for claims with a value of less than £5,000 will be the ‘small claims track’.  When doing this the judge will consider this form, make ‘directions’ for the future conduct of the case and, for most small claims, set it down for a hearing. 

This however is often of limited value - if the tenant is genuinely unable to pay rent they will also be unable to pay a judgement debt.  However, many tenants will make a greater effort to pay if they think you are going to apply for a CCJ as the registration of a CCJ against their name will affect their credit rating.

There is a series of very useful leaflets published by the court service, which are available at most court offices and online at:

These describe how to make a claim, and also how to enforce any judgement made, which is not paid by the defendant, though the courts.

Court related options – enforcement: Once you have your county court judgement there are various methods of enforcing this through the courts if the tenant fails to pay voluntarily. Note that in the enforcement stage, the claimant is often referred to as the ‘judgement creditor’ and the defendant as the ‘judgement debtor’. Here are a few of the most common enforcement methods used:

  • Enforcement via the county court bailiffs - this is where the bailiff goes round and removes the defendants possessions, eventually (if they do not  settle the debt) to sell at auction. You can also transfer a case where there is a judgement for over £600, up to the High Court for enforcement by the High Court Sheriffs, who are considered to be more efficient than the county court bailiffs, but you may need the help of a solicitor to do this.
  • Third Party Payment Orders - this is where an order is made that someone who owes the defendant money pays it to you, rather than to the defendant. It is most commonly used against banks when the defendant has an account in credit. The problem is that many tenants with rent arrears will be overdrawn at the bank.

Attachment to Earnings Orders - this can only be used if the defendant has a job (i.e. not if he is self employed).  The court will order the employer to pay part of the defendants salary to you on a monthly basis until the debt is settled.

The court service produce some helpful leaflets on the enforcement of county court judgements, which can be obtained from any court office or online at:

>> Options to recover arrears – prosecution proceedings

If you are unable to obtain payment of your rent from the tenant, eventually you will have to go to court to obtain an order for possession (unless you are prepared to allow the tenant to live in it rent free). There are two types of proceedings that are commonly used, a claims for possession on the rent arrears ground [see section 6.2 on possession] or a section 21 notice [See section 6.2.6].

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