Cant’ Pay, Won’t Pay? What Happens if You Fail to Pay Your Rent

Shelter is at the very bottom of Maslow’s Hierarchy of Needs. Put bluntly, we all need to maintain a roof over our heads. This can make it feel like your world is caving in if you’re unable to pay your rent.

This can be a tough problem to resolve, especially as pride will likely get in the way. It’s important that you confront the issue head-on, though. Ignoring it solves nothing, and you certainly shouldn’t get yourself into mountainous debt in a futile attempt at keeping your head above water.

If you cannot – or maybe simply refuse to – pay your rent, it’s important that you understand your legal rights – and how to go about resolving the situation.

Financial Difficulty

We all have financial problems at certain times in our lives. Whether it’s due a short-term cash flow issue due to an admin error at work or the loss of a job, paying the rent can suddenly become problematic.

If you think you’ll struggle to pay your rent, inform your landlord at once. Don’t delay – the faster you inform your landlord, and the more transparent you are, the likelier you are to agree a solution. If you have a good relationship with your landlord, they will likely work with you to come to an understanding.

There are no shortage of nightmare tenants in the world. If you’re one of the good ones, your landlord will want to keep you in the property. You will receive a notice of arrears from the landlord and a demand for payment. This is just a legal formality. The landlord must issue this. It does not supersede an agreement that you have mutually agreed to in writing.

Your landlord is not likely to simply tell you to forget about rent for a month. However, they may agree to reducing the payments in the short-term, with a view to increasing them to make up the shortfall when your situation improves. Alternatively, if you have a guarantor, your landlord may approach them to cover your shortfall. Make sure that your guarantor is aware of this situation and willing to help. Whatever agreement you come to with your landlord, if any, make sure you get it in writing.

Even if your landlord is playing hardball, you cannot be evicted on the spot. To evict a tenant, a landlord must obtain a warrant of possession from the county court. This will either be a Section 21 (used when a contracted tenancy is scheduled to end, or you are on a rolling tenancy contract) or a Section 8 (when the landlord can prove that you have violated the tenancy agreement – this could include non-payment of rent.)

A landlord serving you with a warrant of possession must give a minimum of eight weeks’ notice – and that start once you have been notified of the intent to evict. You cannot be asked or expected to leave the property before this period elapses. This is potentially another two months of lost revenue for the landlord – hence why it’s in their best interests to come to an agreement with you. If the landlord is insistent on evicting you from the property, it’s best to accept the decision and look for a new place to live. You can leave earlier than the scheduled date if you prefer, depending on the terms of your lease. If you find somewhere else to live, you can move within a week if you are suitably organised.

A landlord can still sue you for unpaid rent arrears, so be prepared for this outcome. It’s unlikely, though. It will probably cost the landlord more in legal fees to go through this process than they will gain from the unpaid arrears. Legal proceedings are usually started as a scare tactic to motivate you into paying up on the spot. Seek advice from the Citizen’s Advice Bureau if you have any concerns.

Withholding Rent

You may be capable of meeting your rent expectations but unwilling to do so. This may be because you consider the property that you are living in to be unfit for purpose, or that the landlord has breached agreements or promises to conduct essential repairs or improvements. This is often referred to as withholding rent.

Withholding rent is a murky area within the law. In simple terms, a tenant is not legally permitted to simply stop paying rent as part of a stand-off with a landlord. This will be classified as a case of rental arrears and the law will side with your landlord, should things go down that path.

It’s hugely advisable to come to a mutually agreeable arrangement. There is little to gain by going to war with a landlord – even one that is not fulfilling their basic responsibilities and expectations. After all, they have already showed themselves to place little value in appropriate behaviour. Have our ever heard the old age, “don’t wrestle with pigs; you’ll both get dirty, but the pig enjoys it”? That applies in this instance.

What you can do if necessary, however, is address repairs and improvements yourself. You will need to cover the upfront financial cost and deduct this from your next rental payment. If that covers the entire expected amount, so be it. In order to operate within the law, there are still certain parameters that must be followed.

Let’s imagine that you rent a property, and the boiler has broken down in the middle of winter. This leaves you without access to hot water and central heating. Any right-thinking person would agree that this is unacceptable. Follow this protocol to get the issue resolved.

  • Notify your landlord of the problem, in writing. If your property is managed by an Estate Agent, loop them in too. Give your landlord a reasonable period of time to respond. Keep records of all your communication. Don’t talk on the phone – get everything in writing. Emails and letters are pivotal.
  • If the landlord does not address the concern in a reasonable time-frame, inform them that you will fix the problem yourself and deduct the amount from your next rent payment. Get three professional tradespeople to attend the property, assess the issue, and put quotes in writing.
  • Send these quotes to your landlord. This is so the landlord has another opportunity to address the problem, using a preferred (or cheaper!) trades-person if they wish. You can dispute this is you suspect that the landlord is using an unsafe or unqualified practitioner, but they hold the cards.
  • If the landlord does not take action, get the boiler repaired. Legally, you must use the lowest cost trades-person that quoted you. Settle the bill with the trades-person directly and remove the sum from your next rent repayment.

Now, this system is clearly flawed. It relies upon you have enough liquid capital to settle the bill yourself, for a start. Our broken boiler example is a common, but highly expensive, issue that could arise. What’s more, you can only withhold rent based on the costs of the physical repair. You cannot claim back lost earnings because you were made unwell by the cold conditions and unable to attend work, for example.

If you end up going down this road, it’s best to start thinking about a house move at the end of your existing lease. Your landlord has proved themselves to be unreliable and your relationship may be damaged irreparably. This is why it is so important to ask appropriate questions ahead of moving into a rental property, ensuring that you are making a sound choice of accommodation.