Landlords urged to seek insurance and guarantees to protect themselves financially - Palmers Solicitors

Landlords urged to seek insurance and guarantees to protect themselves financially

Landlords urged to seek insurance and guarantees to protect themselves financially

Residential landlords and letting agents have been urged to obtain guarantors or insurance products to protect themselves from the financial consequences of tenants falling into arrears.

The call from the National Residential Landlords Association (NRLA) followed reports of some landlords asking for rent advances from prospective tenants worth as much as £10,000.

The Tenant Fees Act, which has been in force since 2019, prevents landlords and letting agents from demanding large deposits and admin fees at the start of a tenancy.

However, landlords can still ask for substantial rent advances.

While the trend has generated negative press for landlords, recent figures show that more than 800,000 renters in the UK are in arrears, meaning the risk to their financial footing is very real.

Nevertheless, the NRLA emphasised that other options are available to mitigate the risk of defaulting tenants.

A spokesperson said: “We would encourage landlords to look for alternatives to asking for high levels of rent upfront.

“Where necessary, it is usually simpler to obtain a guarantor or suitable insurance product.”

For further information on how to resolve landlord and tenant disputes or debt issues relating to rental arrears, please contact us.