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Section 8 - Court Process etc.

Started by tim2024, October 16, 2024, 09:43:09 AM

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tim2024

I have recently issued my tenant a section 8 notice of eviction with a 1 month notice period. The tenant has over 2 months rent arrears and has failed to make agreed payments on multiple occasions. The tenant claims that her recent divorce has put her in  financial difficulties as her partner had racked up a large amount of debt when he was living in the property (unpaid bills). She claims to have taken out money with loan sharks which is effecting her ability to pay the rental charge. She has a young daughter who is also living in the property with her.

Since issuing the notice, the tenant is not agreeing to leave and states she will pay the rent. Although she does not provide any evidence that she can afford the rental charge and given the multiple failed attempts at agreed payment plans she has lost credibility.

One thing I haven't done is put the tenants deposit in a protected scheme. Would this invalidate the section 8? What are the implications and what is the best course of action?

It is very likely that my case will have to be resolved in court and I was wondering how long the process can take and how strong my case will be for a successful eviction. I do not have any experience in this matter so would like to know how this is likely to play out in terms of time, cost and success.

Also, how does the court hearing work? How long could this all take to resolve? What would make my case strong and give me the best chance of success?

David

Although at first glance the Section 8 process may seem faster, they both end up taking many months to get the Tenant to leave, so don't hold your breath.

DEBT

The approach I suggest Landlords in your position take is to sound sympathetic to her situation, explain that if she is totally open about her financial situation then you will signpost her to solutions that may help her.

Ask her in the first instance to fill out a Statement of affairs and leave nothing out, then paste you the results in an email.

https://www.lemonfool.co.uk/financecalculators/soa.php

You should inform her that loan shark debt is not enforceable and she needs to understand about priority debts. Suggest that she goes to National Debtline

https://nationaldebtline.org/

or Stepchange,

https://www.stepchange.org/

They will help her find a way out of debt. 

Explain to her that consumer debts have solutions such as a Debt Relief Order or Debt Management Plan, she can read about those on sites like Money Saving Expert, they have a forum section called Debt Free Wannabe.

https://forums.moneysavingexpert.com/categories/debt-free-wannabe

Warn her to AVOID debt ads at the top of Google or any private companies offering debt solutions, they are all after a commission.  She can self-manage everything or use the charities listed above.

Explain that regardless of the scary letters of consumer debt or their collectors, they are nothing more than tactics, debt collectors have no right of forced entry and she should never let them into the property or even engage with them at the door. That means do not open the door to them, do not call them, withdraw her consent under GDPR to deal with them by phone or SMS and even email if she wants.

What the Debt charities and forums will tell her is that there are "priority" debts and her home is number 1 in that list. 

When she says loan sharks she may mean pay day loans, these are still consumer debts which are one of the lowest priorities, they can be negotiated down to 40% of their original value, interest can be frozen by simply going into default, but she needs to take her head out of the sand and access the help provided above. 

Going into formal default on consumer debt simply means writing to the debt owner and explaining that she will not be making any more payments.  This does wreck her credit record but if things are as bad as you suggest then she has probably damaged it anyway.  The consumer debt lender will send her a couple of letters which formally include the date of default.  People then usually save the money as much as they can to an emergency fund and then use that to negotiate the debt after it has been sold off for pennies in the pound.

Other options that are open to her include paying £1 a month to the original lender, this does not freeze interest it keeps the debt alive (a solution only recommended if she can see a clear path to being able to afford to service the consumer debt). 

You need to establish if she in on benefits or working, the SOA should tell you that.  If she is in receipt of benefits you can at least stop the debt increasing by asking the DWP via Job Centre Plus to pay her housing benefit directly to you. 

If she is working then you probably have to work more closely with her.

Unpaid bills for someone in her position can seem daunting but they all have solutions, her energy debt  can be put on her meter, if it is a smart meter then it can be flipped to a prepayment meter by the energy company in seconds.  The debt is then reduced at a reasonable rate by taking a percentage with every payment she makes and if they take too big of a percentage she can ask for it to be a lower percentage. 

I know this is not what you signed up for when becoming a Landlord but if you want to be made whole again it can produce good results.  I am not saying you manage her day to day but that you signpost her to people that will and that you make sure she gets the help that is available.  Another good organisation for support of women in her situation is Women's Aid.

HOUSING

The first thing she/you should know is that with a child she will be deemed as a vulnerable Tenant which means the Council will owe her a Housing Duty.  That being said, if she is being evicted for rent arrears she can be deemed intentionally homeless, although the needs of the child will be the priority, so they rarely abandon applicants with children and social services would be involved in any decision. 

Obtaining Social Housing is NOT an easy process, it was always deliberately hard but now it is virtually impossible to get a Social Housing property in under a year, sometimes several years, during which time she will be in "temporary" accommodation.  It is a lottery of area, housing stock and Council attitude, signpost her to the Shelter website so that she gets the same messaging that you will be giving her.

https://england.shelter.org.uk/professional_resources/legal/homelessness_applications/where_to_get_advice_about_homelessness

If the Tenant read the notice and got advice it would have been to tell you that she MUST not leave so don't take it personally.  Regardless of which procedure you use the Council will probably insist she remains in the property until the Court appointed Bailiffs evict her.  Councils do this because it delays their obligations, time was that it was only the big cities that had this policy but these days it is almost everywhere.

The Council has four homeless duties; Prevention, Relief, Interim and Main.

The Prevention duty is just advice that may prevent the homelessness ,but if she does not engage with them they may deem that she failed to cooperate and discharge their duty, to be honest they have a plethora of ways to try to discharge their duty and they use each and every one of them. 

The Relief duty requires the Council to take reasonable steps to help the Tenant get a 6 month Tenancy, this varies by area.  It may mean they reach out to you, offer to pay her deposit if you will give her a new 6 month or 1 year tenancy, this is part of the Relief Duty. 

You offering her a new Tenancy is not as bad as it sounds, you have leverage over the Ex, so you can say to him that he will be jointly liable for what will probably be £5k of legal fees plus her arrears after months of litigation, however, if he agrees to settle the debt you will consider putting her on her own Tenancy. 

After the Relief duty, which goes all the way to her being evicted, there is the Interim Duty, this is basically where they try to stuff her in anything from a bedsit or super tiny HMO, during all these stages they will subject her to a Personal Housing Plan which manages her trying to find a place in the Private Sector. If she fails to carry out the tasks such as viewings they can try to discharge their duty.  Finally under the Main duty she is on some list based on her priority need and they have not deemed her as intentionally homeless.

EVICTION and DEPOSIT PROTECTION

You will likely be returning or protecting her deposit to avoid delay to eviction proceedings and you will still be liable for sanctions regardless of whether you return it or not.  Note, if her Ex is on the Tenancy then you need to serve him with the S8 and/or S21 as well, otherwise you fall at the first fence.

Personally, I always advice Landlords protect the deposit as soon as they become aware they forgot, because this mitigates their sanctions.  If you return the deposit then you deprive the Tenant of the free ADR provided by the Scheme and that ADR process may avoid Court action on the deposit protection issue.

Strictly speaking the Section 8 procedure does not have the same prerequisites such as deposit protection, but in practice there is a stunt that is often pulled where the Tenant seeks an adjournment as they have just discovered that they may have a counterclaim for deposit protection sanctions and need time to take legal advice.

These are the Grounds under S8

https://www.propertyinvestmentproject.co.uk/blog/section-8-evicting-tenants/#grounds

Section 8 also has a little trap where if the Tenant reduces the debt to below two months of arrears then the case can't proceed as a mandatory eviction unless there have been numerous "debt events", this means they have settled arrears numerous times and then gone back over the two month arrears for a period of time.  Understand a Judge has to weigh up your need for money vs putting her on the street, they will look for any reason not to grant the eviction or to delay it.  If she goes under two months you will likely lose your Court fee and not get the eviction.

So you have a choice; try to help her help herself or incur legal fees to get her out, sure she and the Ex could be liable for these fees and the arrears but if you let them get too big they can get a DRO and the debt is gone after a year with no enforcement allowed during that year, leaving you with no means of recovery if the DRO is granted after that year.


FIRST STEPS

Explain to her that you understand that she is overwhelmed by debt but she has lost credibility with you because she has not kept to her commitments.  Explain that she can regain that credibility if she provides you with the SOA and takes up the debt advice from National Debtline or Stepchange and then keeps you informed of her progress regularly until the rent account is brought up to date. 

She may not even be on benefits but be entitled to them; she can use the Turn2Us website to see what help she is entitled to.

https://www.turn2us.org.uk/

Explain to her that the alternative is that you will employ the services of a professional eviction company who will take her to Court, leaving her with a horrendous credit record and all that implies.

If the Ex was a Joint Tenant at the property then any claim will be against him as well so you can leverage that, explain to him that you will be taking Court Action and he is jointly and severally liable for the whole debt.

Honestly compared to most people here you are not in a terrible position, the debt is low compared to most and you have many options to help her help herself.

Luckily debt advice offered is pay for Rent, Food and Energy first, everything else is not a priority. 

Sometimes people are simply in bad contracts, so cutting outgoings is the way to go, e.g. that £50 a month mobile cost that is out of contract can be replaced with a £3 a month MSE deal.

https://www.moneysavingexpert.com/latesttip/

So often people spend way more than they need to, if she is on benefits she may be entitled to a social tariff on her broadband or mobile phone, if not then there are all kinds of offers around.

If she won't engage with you then brace yourself for at least £5k and up to 16 months for eviction proceedings with Court Appointed Bailiff eviction, it is illegal to forcefully evict a Tenant, the only people allowed to use force are Court Appointed Bailiffs.  You can reduce the time by paying specialist eviction law firms, but these typically include more money upfront. 

An eviction specialist law firm with likely suggest starting everything again in case you made any mistakes, they will probably advise you give her back the deposit or even use their agents to deliver it with witnesses and video.  They will start with both S8 and S21 notices with every potential loophole resolved in that bundle. Usually they actually file one claim at a time, each serving as a backup for the other and a lessons learnt exercise. The S21 is an accelerated procedure so it should get to Court faster but things are not always that simple.

Also specialists will advise you ask for High Court Eviction as part of their S8 claim, basically asking the Judge to allow you to save time on the Court appointed Bailiffs and use the HCEO's to get the Tenant out quicker.  You will need to show grounds and two months arrears may not be enough to sway the Judge. 

I would say the minimum time to evict is 6 months, 2months before you can file the Section 21 or 2 months delay in the S8 process vs accelerated procedure time. 4 months to get a hearing if you are lucky and there are no delay tactics.  2 weeks to 6 weeks granted on possession order under S8, then 7 to 12 weeks delay on County Court Bailiffs who are backed up at the best of times, although it varies by area.

The Deposit Protection sanctions can be negotiated, so I would not worry about them at the moment, you may have mitigation and be able to show why a 1x deposit sanction is likely, then include that as part of your settlement with her.  If the Tenancy fixed term expires then you can increase the rent to the max the local market will allow, she can appeal it under S13 but she will still owe the rent from the date of the increase if you are successful.  If she pays the new amount then she is deemed to have accepted the new rent, you can then negotiate any rent on a new Tenancy in her name only to somewhere in between the new and old rent if you feel the need to.

Under S8 there will inevitably be a hearing, under S21 she has to ask for a hearing to avoid quick possession order being granted, the Council will refer her to a Law Centre, the Deposit Protection status will be checked and used where appropriate to delay matters. 




Quote from: tim2024 on October 16, 2024, 09:43:09 AMI have recently issued my tenant a section 8 notice of eviction with a 1 month notice period. The tenant has over 2 months rent arrears and has failed to make agreed payments on multiple occasions. The tenant claims that her recent divorce has put her in  financial difficulties as her partner had racked up a large amount of debt when he was living in the property (unpaid bills). She claims to have taken out money with loan sharks which is effecting her ability to pay the rental charge. She has a young daughter who is also living in the property with her.

Since issuing the notice, the tenant is not agreeing to leave and states she will pay the rent. Although she does not provide any evidence that she can afford the rental charge and given the multiple failed attempts at agreed payment plans she has lost credibility.

It is very likely that my case will have to be resolved in court and I was wondering how long the process can take and how strong my case will be for a successful eviction. I do not have any experience in this matter so would like to know how this is likely to play out in terms of time, cost and success.

Also, how does the court hearing work? How long could this all take to resolve? What would make my case strong and give me the best chance of success?