UK Landlord Forum / Life

Hi was hoping someone could help with a question...

We currently have a tenant who's rent is partly paid direct to us as housing benefit from the local council (which is all up to date), but he then should have been paying a top up rent directly to us to make up the difference. He is yet to make a top up payment giving a long list of excuses for the past 8 weeks.

He currently owes £515 in arrears.

The top up rent is due again tomorrow,which is £229.

IF (and that's a big if) he makes any payment tomorrow do I take that amount off the rent currently due first and foremost, or does it have to go to reduce the arrears first?

The only reason I ask is I am going to start charging interest (as per the rental agreement) on the arrears and want to calculate it correctly.

Many thanks for your time and any help.

You would always use an incoming payment to go against arrears, unless - maybe - specifically requested not to do so, which would be strange.

However, don't get your hopes up regarding interest - the amounts you calculate will be nominal in the extreme. Hardly a deterrent to most folk.

A top-up of £229 is a large top-up (in my opinion) and I would move to start thinking the property is unaffordable for this Tenant. I have 1 Tenant receiving LHA and various recurring top-up issues... however, that top-up is a mere £40 per month.

What interest rate will you be applying?