Rent and Legal Cost Protection Plan
What is The Home Management Rent and Legal Costs Protection Plan?
It is a rent and legal costs protection plan to protect the landlord when a tenant fails to pay the rent due and/or the cost of legal action should an unforeseen problem arise.
Why should I have it?
We pride ourselves in minimising the risk of a bad tenancy as far as is possible through the careful screening of prospective tenants and the efficient management of the tenancy. However, events such as the loss of employment, illness or a relationship break-up can transform an excellent tenancy into a major problem with the rent not being paid and legal action becoming necessary to gain possession. This can be expensive for a landlord and is a particular concern when the property is part financed by a mortgage.
What is the cover?
- Up to 12 months rent due but not paid by the tenant is paid by Home Management under this plan, plus
- Cover for up to £50,000 worth of legal expenses arising in respect of any material breach of the tenancy agreement by the tenant.
What are the advantages?
- Rent not paid by the tenant is paid by Home Management direct into the landlord’s bank account within 15 working days of the due date. This means that landlords can plan their financial affairs with confidence, knowing that the rent will be paid by a particular date even if the tenant defaults.
- There is no excess for the landlord to pay.
- When vacant possession occurs in breach of the tenancy agreement, rental cover continues for up to one month after possession has been obtained providing the property is re-marketed for letting on a sole agency basis by Home Management.
- Under this plan Home Management pay the rent if the tenant does not. This means that we have an even greater interest in ensuring that the tenants are carefully selected, and the tenancy is particularly carefully monitored. Our liability is backed by National Residential Plc, thus providing landlords with complete security.
Why is this unusual?
This plan is only available via a very limited number of agents meeting the most stringent requirements regarding their professional conduct. It is significantly better than other available schemes, where the cover provided is often restricted, and there are other drawbacks, such as a substantial excess on the policy and delay in the receipt of payments.
What is the cost?
The cost at 3.00% + VAT is similar to other schemes providing much less cover. This means that for an average tenancy where the rent is £500 per month the subscription would be £15.00 + VAT per month. This is a small price to pay for the peace of mind of knowing that the rent will be paid each month and no unforeseen legal costs will be incurred.
How do I participate?
All new tenancies where we maintain the rent account will automatically be considered for inclusion in the plan unless clients specifically instruct us to the contrary. We will inform clients should a proposed tenancy be unacceptable for inclusion in the scheme.