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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

AIBU to not accept new tenants currently on furlough?

185 replies

misstiggiwinkle · 22/05/2020 16:42

I am letting out a small flat in London and have received an asking price offer from a couple, the main earner is currently furloughed. AIBU not to accept their offer as I am worried that they will be made redundant and then not be able to pay the rent?

OP posts:
Pixxie7 · 22/05/2020 19:30

I don’t think you are being unreasonable but at least they have been honest with you so that should count for something. Also they will be entitled to universal credit and given the risk of massive unemployment you may find it difficult to find employed applicants.

Inkpaperstars · 22/05/2020 19:32

I don't think you are being unreasonable to wait and see what other offers come in. It's difficult because almost all jobs are at risk, and demand for London rentals is likely to fall over the next year (imo of course) , but than at the moment supply is also very limited so you may be in a good position for those who need to move right now.

WanderingMilly · 22/05/2020 19:32

I am currently furloughed and likely to continue being so for a bit.
Fortunately I took out my contract just before lockdown - I also rent - but I would be pretty upset if someone turned me down because of being furloughed.

For a start, being furloughed means you have a job and they want to keep it open for you. Secondly I have a fair bit of private money stashed away and could happily pay rent even if I didn't work at all. I am an extremely good tenant, always pay on time, never any trouble etc. I would be cross at someone making such a judgement about me based on so little...

WombatChocolate · 22/05/2020 19:40

Affordability checks are a standard part of tenant referencing. A furloughed person is less secure than someone in a job. Likewise some jobs such as public sector might be more secure than other types of job.

Usually a LL can gather several applicants who are interested and proceed the one they like. It is up to them how they choose - people might be put off by pets or income or benefits or whatever. People always moan about landlords who say no benefits tenants. I understand how frustrating that is to reliable tenants on benefits but also understand the concerns as some are not reliable and it’s not easy to tell which is which, plus there can be clauses in mortgages or insurance which prevent benefits tenants.

I’d check if furlough counts as benefits - mortgage or insurance might prohibit.

In the end, being a LL is about having a steady reliable stream of income. These days there’s more uncertainty for everyone but it’s entirely under stable if Op wants to go for the safest possible option. To all those who are horrified they might turn this person down. If you had a mortgage to pay each month, would you choose the person in a secure looking job or the one in a more insecure job? Would you want more or less certainty about tenants ability to pay rent into future? I think we all know the reality.

It’s often possible to get a guarantor who is committed to paying the rent if tenant can’t. I’d only consider someone on benefits or fulough with a guarantor.

Catsrus · 22/05/2020 19:40

@canigooutyet - no - not hacked - when MN deletes a post it looks different (shaded). this was just a bog standard post like any other. Look back at that post now, it has been deleted.

SeasonFinale · 22/05/2020 19:47

Furloughed staff are not necessarily in any more precarious position than non furloughed in today's climate.

I think the suggestion of a guarantor is sensible if possible.

AragornsManlyStubble · 22/05/2020 19:47

I would rent to them with a guarantor. I had to have one to rent my house, never needed them but it’s security for everyone and at least it gives them a chance of still moving into a property.

XingMing · 22/05/2020 19:53

I really don't think it would be unreasonable to ask some probing questions. I have one, small commercial property that is a significant part of a pension plan. It was let in December, after nine empty months, and after paying the initial rent and deposit, COVID has thrown a massive spanner in the works. The tenant (a bespoke kitchen company) is still getting ready to open properly, their customers are likely to be wary of having contractors in to fit the new kitchen, and they are worrying about cashflow. We can, ATM, ride it out, and we are keeping our fingers crossed and hoping the world gets back to some kind of normal. But in the meantime, the costs of insurance etc, are eroding our life's savings. ANd because we are 64, it is something of a worry if I am honest.

I don't think there's an easy choice that's going to see you sailing free of anxiety. I cheer myself and DH up with the promise that it won't always be like this, and we have been careful with money and have some saved. But it's increasingly likely that our retirement planning will mean working PT to and past 70.

Puzzledandpissedoff · 22/05/2020 20:00

This is a business transaction. Protect yourself

Advice which is more relevant now than ever

Another point is that cumulative changes mean UK tenants now have a very high level of security of tenure, which is as it should be ... but it's hardly reasonable to expect LLs to adhere to every dot and comma of rigorous regs when it suits, then cry "couldn't they just be kinder" when it doesn't

WombatChocolate · 22/05/2020 20:01

No one is saying furloughed people are bad people or that they don’t deserve housing. That’s not what this is about.

Being a landlord is generally about maintaining a steady rental flow. It is not about providing housing as a social service to those who might be very nice, very deserving but who lack a secure income now or very likely in future, with the result rent might not be paid.

The furloughed might have a job in future...or sadly not and therefore struggle with rent.....and Op is not cruel or unkind not to want to get involved in that. Op can feel very sympathetic for those who are furloughed and have job insecurity....but that does not have to mean putting herself at financial risk.

Most LLs understandably want the most financially secure tenants. It’s why affordability referencing happens. Why would anyone choose a tenant who fails that referencing which gives a higher risk of the rent not being paid, over someone who is much more secure and low risk? No one is risk free as anyone can have a change of financial circumstances, but you have to weigh risk and a furloughed person poses more risk at the moment. Risk is best avoided when it can be.

If there were no alternative tenants and a guarantor appeared I would consider this person. Thanks f there was no guarantor I wouldn’t and would leave the property empty.

To those crying ‘outrage’ do you know the costs that can be incurred in evicting a non-paying tenant or in terms of lost rental? It can be many thousands as many have found to their loss. And that’s why LLs are usually risk averse and want the safe option, because quite sensibly they want to avoid the huge potential costs of a non paying or only partly paying tenant.

When your existing tenant finds their circumstances change, you work with them to help and make it work into the long term for both of you - rent deferrals, possible reduction etc. It still all costs you money. However you don’t choose to start from that position and say yes to someone who will fail the affordability tests, especially when there are other secure buyers.

If you were in a sofa showroom selling sofas on credit, would you rather sell to the person who passed a credit check and was therefore very likely to pay each month, or the one who failed it, meaning there was a higher possibility they might not be able to pay, regardless of reason. Or would you say ‘tell me why you’ve failed the check - yes I can see hard times have fallen on you which were not your fault at all, so you can have the sofa anyway instead of that other person, because actually I don’t mind taking the risk because you seem so nice’ ??

MulticolourMophead · 22/05/2020 20:02

I always rented to public service because they will always have their snouts in the trough.

I'm public sector, and certainly don't have my snout in the trough. Currently furloughed, but when other business sectors, especially schools, are back in, I know my workload will be back and I'll be back in the office again.

I'd recommend OP checks out the references, and risk assesses the applicants. OP mentioned website marketing was the occupation of the furloughed individual. I don't know that market, how secure would that job be?

Cherrysoup · 22/05/2020 20:16

Dunno why you’re asking, it was just the first people to see it. Wait til you’ve had a few other viewings then obviously do a shit ton of credit checks on whoever you want to move in.

voddiekeepsmesane · 22/05/2020 20:18

So so YABU. As a family on benefits (apparent bottom barrel) I feel ANY renters pain. I am a carer to DP who is disabled with 1 DS who is now 15yo. We are not capped on benefits as a disabled family. We have been in 2 addresses in the last 13 years, 7 years in one and 6 years and counting in current flat. NEVER ever been late with a rent payment, but as soon as we mention housing benefit ....well lets say we were almost on the streets last time and the only reason we had to move was because landlord was selling up.

Now with so many furloughed and many more actually being made redundant I do worry that the housing market will not cater to them. As private landlords can do whatever they want and discriminate however they choose.

Blanket stereotyping is easier than actually talking to people and finding out personal situations IMO

Fruitsaladjelly · 22/05/2020 20:28

Furloughed from what job? For what reason? Hairdressers for example are going be extremely busy in another month, and back to ‘normal’. Wedding photographers are going to have a tougher ride. Furloughed construction workers are more of a worry as furloughing in industries that should be working might mean there is trouble brewing

Inkpaperstars · 22/05/2020 20:29

There are a lot of London renters who don't want to commute too far into work and/or want to be close to the action. Now that many office workers will be commuting only occasionally while the covid crisis lasts and probably beyond, and the cultural/social life of the city is restricted for the foreseeable, I think there may be an exodus. For many others in customer facing roles jobs will be lost. People don't pay London rent and choose smaller, more population dense living spaces when neither work not the traditional life of the capital are there to encourage it.

Right now though I don't think this has kicked in and pent up demand of people who need to move now or need to downsize due to finances will possibly make it favourable environment for you OP. So I think getting a tenant who wants a long contract might be good.

SoloMummy · 22/05/2020 20:30

Yanbu.
You need to think about their long term financial ability to pay.
I'd definitely look for someone not furloughed with a permanent work contract.

Beautiful3 · 22/05/2020 20:30

I wouldn't, unless you ask for a guarantor.

XingMing · 22/05/2020 20:31

If vodka keeps you sane, and that's your declared user name, I'd probably cross you off the list first. Sorry to be harsh.

voddiekeepsmesane · 22/05/2020 20:35

Fuck off XingMing you know nothing about me. Are you Chinese? See how offensive it could be by just going by a nickname on a site! I have had this nickname for almost 10 years on here and you are the first to think that it actually is my entire personality.

WombatChocolate · 22/05/2020 20:36

I currently have a tenant who is on benefits. Has been there 3 years and his mum is his guarantor. He has always paid on time and been very pleasant and actually now is less of a risk as he hasn’t got a job to lose!

He was in the property when I bought it and I was happy about it because he had been there a year already. Otherwise I would have worried and he wouldn’t have been my top choice if I’m honest. I have had to pay more insurance and it only worked because I don’t have a mortgage.

When mortgage co.s say no DSS and most insurance co.s do too, most LLs who have mortgages HAVE to say no.

Isn’t the reality quite simply that someone in a secure job and who the insurance and mortgage co accept will be higher up the favourites list for most landlords?

I agree that lots of tenants on benefits might be brilliant tenants with a long, excellent renting record and it’s a shame there isn’t more individualisation of risk assessment. Mortgage co.s and insurance co. S. And often letting agents use blunt tools - and why - because across many thousand renters, those on benefits ARE a greater risk and there’s no avoiding that. Insurance companies and mortgage co.s need to use blunt instruments to assess and reduce risk and that does penalise the good tenants who are on benefits, but overall benefits those firms and LLs in a broad category wide sense, by reducing risk.

I would say to anyone on benefits with a good history approaching a LL. or agency to ring or visit in person, taking with you records of rent paid on time over years, positive references from previous landlords and guarantor info. Show them very quickly to emphasise you are a good tenant who stays longer term and you’d like them to consider that at same time as benefits issue. You need to get them to see your good features. But for LLs with mortgages, they just can’t take you, however brilliant you maybe.

voddiekeepsmesane · 22/05/2020 20:41

While I understand a SMALL minority of LL have a mortgage that does not allow housing benefit tenants as from 2017 this practice is actually been phased out along with agents are no longer allowed to advertise no DSS so this line of excuse is no longer valid for more and more LL

CovidicusRex · 22/05/2020 20:41

I think you’re being prudent here. If they’re in website marketing and furloughed that’s does not bode well.

LillianBland · 22/05/2020 20:41

I always rented to public service because they will always have their snouts in the trough.

The ignorance is of that poster is obvious from that comment.

XingMing · 22/05/2020 20:42

I don't know who you are, and care rather less @voddiekeepsmesane. But I do read the names and think about meanings and intentions.
Why choose a name that doesn't describe you? My name means Christian name/Family name in Cantonese. As used on forms.

maddening · 22/05/2020 20:43

What about asking if they have redundancy cover? If so it should be OK?

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