Information for Landlords with Homelet Cover

Date Published 07 April 2020

We have received the following update from Homelet today and we hope this will be of some assistance to our Landlords who do have cover, following the publication of the Coronavirus Act 2020

We have been working in partnership with our Insurers and can confirm at present renewals are being processed with their agreement. This position remains under review and we will keep you advised of any developments.

Unfortunately, it is inevitable that some tenants will find their income restricted and may struggle to pay their normal monthly rental. We all hope this is the minority and believe any impact should be materially mitigated by the significant levels of financial assistance that the Government has made available to businesses and individuals.

Landlords, where applicable, also have the capability to take mortgage holidays, which will assist in circumstances whereby a tenant is not able to meet their rental obligations for a period of time. This, and the previous measures detailed above will assist greatly in the prevention of rent arrears and alleviate potential concerns regarding people's homes.

The government has also set out its intention for landlords and tenants to reach an amicable and mutually agreeable solution to deal with any rent arrears. This could include deferring of all or part of the rent due for a period or a reduction in rent due. This process is under consideration with the Master of the Rolls to implement into the Court pre-action protocols. As such, if implemented as expected, this will mean that unless a meaningful attempt has been made to reach an agreement, possession orders may not be granted. Additionally sanctions in terms of cost awards maybe made against the Landlord.

The basis of rent guarantee products is the ability to secure vacant possession of the property. In some cases, a mutually agreeable solution to deal with any rent arrears may not be possible and in such cases, claims will need to be submitted. At this stage, the process for accepted claims will be to secure vacant possession via a process that cannot then be withdrawn without return of any benefits, in the form of rental payments made, and costs incurred. This is a fundamental consideration for the landlord and something they should carefully consider with regards to the eventual outcome they desire, before proceeding with a claim or not.

For all new claims, we will require the following to take place:
• Contact between the agent/landlord and tenant within 7 days following a rental default
to ascertain why the rent is unpaid.
• Active engagement to create and agree a deferment agreement over the first month of
rental default.
• The landlord to arrange for a mortgage holiday where applicable to aid in the formulation
of deferment agreement.
• Engagement with ourselves via the Agent to manage the process together.

Together we both have a key role to play in providing the right outcomes for our customers (both landlords and tenants), in protecting their homes and their income.