During these uncertain times, there are lots of questions being asked and high-levels of certainty. To help provide peace of mind and some clarity, our legal experts have answered some of the most commonly asked questions for both renters and homeowners.
If you are in need or further advice or trusted legal support, please do not hesitate to contact our team by filling out our online form or calling 0330 123 1229.
What happens if you can’t pay your rent due to coronavirus sickness or self-isolation?
Boris Johnson said the government would bring forward emergency Coronavirus legislation to protect tenants, whilst at the same time avoiding 'passing on the problem' by 'taking steps to protect other actors in the economy'.
Labour published some draft legislation yesterday, which the new measures are expected to look like.
In short, it states that where there was a failure to pay contractual rent that was in any way related to the effects of the Coronavirus during a designated period (1 March 2020 – 1 September 2020, although the end date may be amended in future) this would not count as rent lawfully due for the purposes of the relevant rent arrears grounds for possession.
This does not stop the rent being owed to the landlord eventually, but means that those specific arrears could not be used for Section 8 rent possession claims, now or in the future. It is important to note that no changes are being proposed to Section 21 in the draft legislation (as it is impossible to establish the reasons why a Section 21 Notice has been served) but that may change in the coming weeks and months.
Further, the Residential Landlords Association (RLA) has said that tenants must be dealt with 'sympathetically' by landlords during this unprecedented situation and given the option of paying their rent later.
With many people simply being unable to pay their rent as a result of having to self-isolate, take unpaid leave or not fulfil zero-hour contracts, the RLA is appealing to landlords to talk to their tenants about any arrears that might accrue and be flexible where they can.
What happens if you can’t pay your mortgage due to the coronavirus
Many banks have offered to defer mortgage payments for up to three months, although different banks have different rules. Further, this offer does not generally extend to buy-to-let mortgages at present.
The RLA’s recommendations are in stark contrast to the ideas of Richard Murphy, professor of practice in international political economy at City University of London and the author of the Tax Research blog. He argues that tenants should simply be given 3 months rent-free (not deferred) and that landlords can easily shoulder this cost in the short-term as they have an asset to fall back on.
Please note, all advice and opinion offered in this article are subject to change in line with the latest government advice.