Tenant asking for covid rent reduction, WWYD

[psychedelephant]

My tenants have asked if I could reduce the rent due to cv and I've said I'm happy to work something out. Wondering what other landlords are doing.
I suggested they do a financial statement, look at the benefits calculator and work out what they can afford but they keep bouncing it back to me.

I think i'd leave the tenants to present their pay slips and move on from there. If they lost 20% i'll give them 20% off.
if they had lost anything they would have cried out a specific amount.
You are being like a godsend landlord, they need to do the math.

We had a 54% reduction for 4 months. I am on maternity leave and my partner has been put on furlough meaning a £800 reduction.

We've agreed to pay it back by the end of the year and also go back up to full rent if the business opens before the 4 months offered.

@latheritup you're not expecting your landlord to cover your maternity?

@PickAChew sorry, what do you mean? Our landlord is lovely, he and his wife are like friends to us. They were the ones who suggested it.

I would expect my tenants to show me the bank statements, and explain them and then come to a workable agreement.
I have done this twice before when someone lost their income, each time they showed proof of income and outgoings and discussed what the essentials were for them to live and subsequently worked out what they could pay, with a monthly update.
They then knew l wouldn’t be chasing them or evicting them and l knew they had no reason not to make whatever payment had been agreed.
In your instance they are not being reasonable as they are not being transparent, don’t beat around the bush , say what needs to happen, ie a FaceTime call with all documents sent to you beforehand and a budget from them and most importantly a willingness to discuss options.
We all have to do this to get a mortgage or loan, finances are minutely scrutinised.
You are clearly willing to be fair but they have to meet you halfway. For me alarm bells would be ringing considering their behaviour so far.

To me it doesn't sound like they are trying it on as such, more that they anticipate their situation changing very soon and they are trying to get a jump on what kind of rent reduction they might be able to get.

It does sound like they aren't being particularly proactive though and I understand your frustration.

Our landlord still wants full rent despite husband being self employed and unable to work and our income halved. We were only just managing with both of us working. No universal credit until our interview next week (weeks after he had to stop to self isolate). No help from government until June. We've asked if they can temporarily reduce our rent or claim a mortgage holiday and we just get told the more we can pay the less likely they will sell (and make us homeless) when this is over. It's lovely to hear OP that you want to help your tenants and that other landlords are being understanding. Knowing we could be kicked out through no fault of our own is not the reassurance we were looking for..

You will always get people who try to take advantage of a situation and that MAY be your tenants. If they are not willing to enter into discussions about their personal circumstances then it is fair to assume they are chancers. When starting a tenancy referencing will have been carried out in order to confirm affordability. This is just the same thing.

I would write to them saying you understand people’s circumstances change but as in the current climate there is everything from people now having no income coming in as a result of Covid-19 to some on full pay at home with no WFH and arguably better off because they have no travel costs etc. There is no one size fits all approach. State you will be as sympathetic to their situation as you can be baring in mind your own situation but the recommendation is to work with tenants to come up with a workable solution for both parties and that much like taking a mortgage payment holiday, any reduced payment now is classed as rent arrears to be made up later but without the usual reminders to pay/interest accrued.

If someone is struggling to pay private school fees currently they will need to write to the school giving details of their change of circumstances, disclosing financial information about themselves in order to have a fee reduction considered. If someone needs to apply for UC they will need to disclose financial information about themselves in order to be considered. There is no god given right to live in someone else’s property and right to not explain yourself when asking for a rent reduction/deferred payment of rent.

I'm furloughed at the moment and normally weekly paid. The business has been closed and we had a last week's wage (reduced as were week before due to losing hours as business reduced before official closure) and now we're waiting on when we'll get the first payment from furlough - they think the end of April.
I don't know exactly how much I'll have each month because my earnings fluctuate weekly.
I spoke to my landlord and told them the above and that I couldn't make the weekly rent payments in April as my income was suddenly changing to monthly and with no notice I couldn't have prepared, and that until I know an exact address, I can't commit to a figure because I just don't know, and if I agree an amount, and then can't meet it I'm breaking an arrangement. They have told me to contact again at the end of April or when payment comes through and the two weeks I owe, plus the 4 from April will be put in arrears, but if necessary can be held until I am working full time again, as long as I start paying my current rent when the payment comes through from being furloughed. If it transpires I don't have enough from the furlough then I'll need to apply for UC.
Could your tenants be in a similar situation to me and not actually know what they're going to get and therefore can't discuss figures as they just don't know?
On a personal level I am pretty sure I'll be able to manage to pay the rent and clear the arrears with the 80% but it's a waiting game for some people like me waiting on the government and employers to work out actual figures.
Though why they wouldn't just explain that I don't know.

It does sound like they are chancing their arms OP. If they have been made redundant or taken a pay cut that is easy to prove with a one line letter from the employer. I would not give them a reduction without some form of proof.

Given the fact that they keeping batting this back to you, I think they are just being cheeky fuckers. So I wouldn’t bite. If they actually needed a rent reduction, they would do as you ask.

However.....circumstances change so I would leave things open with them.

Dear Tenants,
Further to our previous conversation, I am willing to consider a rent reduction if you have been adversely affected by Covid-19.

As you are aware, when you took on this property, you had to supply evidence of affordability such as pay slips, bank statements etc [OP - it is worth double checking what they did provide so you can ask for same again or similar].

In order for me to review your rent, please could you provide your P45 or evidence of any salary reductions or evidence of benefits along with your proposed terms for a rent reduction.

I understand that these are difficult time so will get back to you as soon as possible after receiving the documentation. I am also open to reviewing this on a regular basis as events unfold. I look forward to hearing from you.

Yours sincerely,

Lovely Landlord

I also think calling them is a good idea but follow up any conversation in writing to cover yourself. Something along the lines of ‘ I am writing to confirm that you said x and I said y and we are doing z).

My own, personal view - proportionality is everything. If they have 20% less income (and were good tenants), I would give them a 20% break if I could afford to. I would also be open to their suggestions of (a little) more than that as housing is a big cost and not all other expenses can be reduced by 20%.

That said, people on furlough will no longer be spending as much on work related expenses such as tube tickets/petrol/parking/coffees/ clothes/dry cleaning etc. In fact, when you consider retirement advice Regarding the income you need when working and when you retire (ie are not working), the amount goes down by 20-40% depending on which calculator you use.

I think it’s weird they won’t give you any information.

I’ve been wondering whether I will hear anything from our tenants, but rent just came in as normal. I know they have pensions as well as employment so probably fairly secure. DH has been doing overtime in case they run into trouble though, so we will be able to adjust if they need to. I would want to see evidence of that though...

Given that there is a short relationship here I would get a clause about them repaying any shortfall in writing and make sure it’s watertight, and a very short period to repay within.

And yes they need to be more forthcoming about what amount of reduction they are seeking. If they don’t respond to your message about that just leave it alone for now.

I am cynical, yes, but this is your income and you have to protect yourself. What if they can’t pay you back? Can you afford to take them to the small claims court and have the ability to manage a dispute? Plan on worst case basis. After all we’re all worried about the future and you won’t be helping anyone if your property is repossessed as you have been too helpful and not objective enough.

I am a tenant and rent through an agency. Both me and my partner have been furloughed and I have contacted the agents to see if they could offer any support if we needed it. They too asked for documentation if we could provide it. I went back to them and say I have every intention of paying each month as I do not want to be in a arrears but could I have some leaway and not be penalised if it is a bit late whilst I accumulate it. They have a agreed which is a big relief.

So I don't see why your tenants are not wanting to divulge information to you that would he them with their request. If they are genuine then they should be upfront and honest as we all need to help each other out at this time.

Quick update for anyone interested.

Tenant #1 will get small amount of UC, tenant #2 has been refused - ? In a previous life I worked in the voluntary sector alongside benefits advice but I admit to knowing/understanding little about UC. What do you do if you've been refused UC?

I asked if they'd been in touch with utilities, LA etc to organise reduced installments (eg council tax can now be paid over a longer period due to cv) and tenant #1 said no, they want to pay all their bills in full every month (except rent apparently). So it looks like I'm the only creditor they've contacted.

Waiting for a callback from the NRLA to see what they advise.

Why have they been refused UC? Are they not British and failed the habitual residence test? Or have they just been told they are getting zero because their wages cancel out any entitlement?

They’re both cheeky and shortsighted - always pay your rent first.

Wrong no idea what the stated reason is. Without going into too much detail, neither theory is likely (British, working in industries that have been affected by cv) but DH has a theory that they've been turned down because they have savings (based on nothing more than a comment they made about plans to buy a property).
A lot of it doesn't make sense, they seem naive more than cheeky, but I don't know them well enough really to reach any conclusions.

One one hand I feel like a bit of an arsehole for considering saying no. I do believe they've been affected by cv, I believe their work/income are disrupted until further notice. Otoh, I've been earnestly forwarding links to appropriate forms and agencies since March, checking up to see if there's any news, saying I'm happy to help as soon as I have a better picture of what's going on, I can't fill in the blanks myself ffs.
I also fear there may be some unpleasantness between them. Only one of them communicates with me, the other hasn't said a word. I always copy them both on email, only one ever contacts me.

@HollowTalk Gosh, I'm surprised by the lack of empathy! Lots of people are affected. I have friends who are renting, who are too scared to even broach the subject with their landlords, and your response is probably the reason why.

@psychedelephant I'm confused. Are they a couple with savings? If they have savings, they should pay their rent.

Preggers that's exactly the sort of thing I mean, if you're asking for someone to make adjustments you need to be clear.
I used to help vulnerable people fill out forms and write letters like this.

Small no I don't know that for a fact, DH was speculating. They had planned to buy a property and it didn't work out.

So are they a couple, and are you saying it appears they've fallen out? Regardless, if they were planning on purchasing a property, they must have had a deposit saved for it. Which must mean that they have savings. If they can't provide you with any more information, or don't answer your reasonable questions, I probably wouldn't offer a rent reduction.

I think they could be at it, thinking you’re a soft touch.

They are paying all their other bills. You are the only one they’ve contacted. They hadn’t even attempted to apply for benefits at that point but they could ask you for cheaper rent.
I think a pp hit the nail in the head that one of them has over £16k of savings and that’s why they’ve been refused.

If they are having financial difficulties and are struggling surely they should apply for housing benefit?

Don’t be taken in. If they were genuine they should have given you the full picture. I feel they are hiding something.

I'm in a similar position with a tenant, OP. Last year, we bought a property divided into flats and have established good relationships with the tenants. I've asked them to let us know about any financial difficulties due to the pandemic and everyone's been upfront and communicative...except for one tenant.

I know he's applied for unemployment benefits, which currently include a top-up payment of $600 per week here in the US. He shares the flat with a roommate and this extra money means he can definitely pay his rent - just the top-up payments alone make it more than possible. But I don't think he wants to!

I'm now thinking the worst of him simply because he won't communicate, whereas I know what's happening with the other tenants. As pp's have said, you need more complete information before offering a reduction.