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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

To wonder why agents wouldn't want a years rent upfront?

41 replies

leopardprintlindt · 21/07/2022 17:53

I've been told by an estate agent today that they 'wouldn't want a years rent upfront because of insurance reasons' and if I wanted the house I'd need to earn over £75k.
Does that sound normal?!

OP posts:
TibetanTerrah · 21/07/2022 17:57

I paid 6mths upfront almost 4 years ago but I've heard now some LLs don't like it due to money laundering. It's stupid, surely if you earned 75k and had enough money for 12mths rent you could practically buy a house anyway Grin

luxxlisbon · 21/07/2022 17:59

I imagine 12 months upfront raises some money laundering flags and it doesn’t mean you don’t need regular income from their perspective.

Summersdreaming · 21/07/2022 18:00

Money laundering and/or suspicion that you might be intending to use the property for illegal activity.

Thecatisboss · 21/07/2022 18:00

It was also a sign of drugs when I used to work in the business. People would pay a large sum up front and then grow cannabis in the house.

BlackAndPinkNose · 21/07/2022 18:01

Thecatisboss · 21/07/2022 18:00

It was also a sign of drugs when I used to work in the business. People would pay a large sum up front and then grow cannabis in the house.

Sadly this is highly likely from a friend's experience

loveisagirlnameddaisy · 21/07/2022 18:03

I am a LL and once rented a house out to a tenant who paid six months rent upfront. I had to word the AST very carefully as it could have been construed that I would need to serve a much longer notice period on her rather than the standard 2 months due to the payment cycle being six months, not one month. Not sure if this is the issue the agent has, but it was something that concerned me a little at the time.

Exiledone · 21/07/2022 18:07

Surely in most areas nowadays a years rent would equal around £15/20k. If someone has that kind of disposal income to throw at rent they're either rich enough to buy a house or obtained it through criminal means.

Zeus44 · 21/07/2022 18:15

We’ve had tenants pay upfront before, nothing wrong in it. Just regular inspections allows things to be kept on top of.

Hardbackwriter · 21/07/2022 18:18

They know that the only reason anyone pays upfront is because they won't meet the normal checks - so they're worried about it being used for crime or just that you'll totally trash it.

fyn · 21/07/2022 19:07

We used to reject anyone that offered lump sums unless they have significant cash savings I.e hundreds of thousands. Both at a charity that owns probably thousands of houses around the country and a country estate with about a hundred properties.

As others have said it raises money laundering issues but mostly we wanted people to set up a direct debit with regular payments and have a regular income. It was found that people who paid a lump sum were usually a bit flakey at paying once the lump sum had run out.

swimmingincustard · 21/07/2022 19:12

When I was a LL I had a tenant that paid 6 months in advance.... they didn't pay any rent after that. Luckily only took about 3 months for them to leave but if I was still renting out property I wouldn't necessarily look upon it favourably.

1dontunderstand · 21/07/2022 19:22

Why can’t the LL use the large upfront payment as a deposit and the tenant pay the rent as normal from the start of the tenancy. That way, if the tenant defaults on rent payments, the LL has a substantial deposit to offset the rental loss if an eviction is necessary?

Anonimousse · 21/07/2022 19:36

1dontunderstand · 21/07/2022 19:22

Why can’t the LL use the large upfront payment as a deposit and the tenant pay the rent as normal from the start of the tenancy. That way, if the tenant defaults on rent payments, the LL has a substantial deposit to offset the rental loss if an eviction is necessary?

Because if I remember correctly and they haven't updated legislation recently, landlords are restricted to legally only taking a maximum of 5 or 6 weeks rent as a deposit.
I wouldn't accept up front rent for the reasons many posters have stated above

Money laundering
Drug dealers/growers
Refusing to leave when prepaid rent has been used up and not paying anything further
Issues wuth notice and eviction periods
Not having any money at the end of the prepaid period to continue paying rent as the lump sum may have been legit, i.e. from inheritance etc, but they may not plan on working to pay future rent

the list could go on

Original poster
leopardprintlindt · 21/07/2022 19:37

@1dontunderstand are you suggesting I pay a year up front AND monthly rental?

OP posts:
Original poster
leopardprintlindt · 21/07/2022 19:38

I get the concerns about money laundering, cannabis etc. But if someone has three children who go to school locally , works in the NHS, and has references, why wouldn't you?

OP posts:
icedancerlenny · 21/07/2022 19:45

I paid a year upfront in April this year. There were 8 people after the house. I had sold my house and will be over a year before my new one is ready. It wasn’t a problem.

cinci · 21/07/2022 19:49

Exiledone · 21/07/2022 18:07

Surely in most areas nowadays a years rent would equal around £15/20k. If someone has that kind of disposal income to throw at rent they're either rich enough to buy a house or obtained it through criminal means.

Savings. I paid 6 months upfront as a student since I had no credit history. An adult who was moving out after living at home could too. Landlords and agents use their discretion.

girlmom21 · 21/07/2022 19:51

leopardprintlindt · 21/07/2022 19:38

I get the concerns about money laundering, cannabis etc. But if someone has three children who go to school locally , works in the NHS, and has references, why wouldn't you?

Are they looking for a long term tenant?

I'd personally be concerned you'd pay for the first year out of inheritance or something then not be able to afford to continue renting after that.

cinci · 21/07/2022 19:51

Also, not rich, it was loan money. I don't think it's that uncommon to have the funds, but it can leave you trapped if the place is shit.

blobby10 · 21/07/2022 20:05

My friend has sold his house to fund a masters at uni- he has around £80k in the bank and could pay a years rent in advance with no hint of money laundering or cannabis growing 😁 however if I was a landlord with a buy to let mortgage I would want the monthly income rather than a lump sum

Trainfromredhill · 21/07/2022 20:06

Surely in most areas nowadays a years rent would equal around £15/20k. If someone has that kind of disposal income to throw at rent they're either rich enough to buy a house or obtained it through criminal means

id say around us you’re looking at £50k for a years rent. Rental properties are rare as hens teeth atm….yes, they can buy a house, but they don’t want to in a new place, so they’ll pay the year rent to secure the property. But there is nothing dodgy going on….they probably Have £500k deposit sitting in a bank.

steff13 · 21/07/2022 20:08

What would be the benefit of paying a year up front vs putting the same money in an account and letting the landlord directly debit it each month?

BeyondMyWits · 21/07/2022 20:10

One of my daughter's friends in a 5 room houseshare paid a year upfront as her parents were not accepted as guarantors due to ill health early retirement.

Bluevelvetsofa · 21/07/2022 20:38

We paid six months in advance because we had sold one house and we’re waiting for the new one to be completed. It was eight years ago though. If we were to do it now, we wouldn’t have an income of 75K, but we would have the proceeds from the house sale.

safetylastday · 21/07/2022 20:48

But why would you want to pay upfront?
what if it floods or has some issue after a month - what would you do then?