UK Landlord Forum / Life

Hello, I've signed a shorthold assured tenancy contract with a new tenant, and am now having second thoughts... little things that don't add up.  The tenancy id due to start in 2 weeks.  Can I change my mind, ie is there a cooling off period?  I haven't yet  presented the cheque for deposit and 1st month's rent.  If there is no cooling off period, and the cheque bounces, can I then get out of the contract?

No cooling off period
Repudiation of the contract only works if both parties agree to "void" the contract.
Not paying might work if the Landlord is unwilling to pursue but legally you are liable for damages.
This will be the amount that is reasonably foreseeable (expectation loss) which in this case is likely 6 months rent.
Cheque bouncing doesn't save anything... you are liable for damages.

You should approach the agent and Landlord and tell them asap. See what they say.

Thank you for your response, very much appreciated.  Just to clarify, I am the landlord.  I've been given a cheque but am now having doubts about the tenant. The cheque has been written by a third party, not the guarantor.  This was not agreed or talked about when signing the contract., and it has put doubt into my mind about this tenant's ability to keep up to date with rent.   Do you know what I would be liable for if I pull out?  I've an idea the cheque could bounce - can I pull out if it does?  Or, if I don't bank the cheque can I pull out?  I'm inexperienced and really appreciate your comments.

You must appreciate that, if you do pull out now, you will be putting your new tenant to considerable trouble, especially if he has had to give notice on a previous tenancy. You will also be back to square one in terms of finding a tenant for your property, with all the costs that entails.Morally and pragmatically, is it reasonable and worthwhile to pull the plug on the deal, just because the cheque is drawn on a different account?

I presume you didn't specify that the deposit must come from the tenant's own account, so why would he think it's a major issue? Have you asked him about it? It may just be that, with a couple of weeks until pay day, and the deposit on his current home not due to be released until after he's moved, it was better from a cash flow point of view to ask a friend or relative to cover the initial cost.

That aside, whether you can get out of the agreement at this stage depends on the contract that you and your prospective tenant have presumably both signed. Have you read it?

You mentioned you had a guarantor.  So your rent is safe as you would pursue the guarantor for any unpaid rent.  Get the cheque paid in now so it clears before they move in.  If not cleared ask for instant payment on move in day. 

I think... if a cheque paid in in good faith, for the first payment of rent, bounced then you'd be on firm ground for unilaterally terminating the agreement before it started. However, you've not given the cheque a chance.

Sorry when you wrote "I haven't presented the cheque" I had assumed you were the tenant.
You should pay the cheque in asap before you handover the keys.
If it bounces tell them you are treating this as a repudiatary breach of the contract.
(Technically/legally it's not as simple as that but in this case you are probably on good ground - it's unlikely the tenant will demand the keys even though his cheque has bounced.

Generally you shouldn't accept payment for a rent from a third party though the contract can specify payment made by a third party on the tenant's behalf is treated as payment by the tenant. This prevents any third party from acquiring any rights as a tenant.
If your contract doesn't say that then be careful.

Best of luck

Thank you for your comments and advice.  Simon Pambin I HAVE read the contract, but there is no provision detailing what would happen if one side were to pull out., and, Angry Landlord, unfortunately there is no clause stating that 3rd party payments will be treated as payment by the tenant. What a minefield!  Unfortunately I looked at what was In the contract and did not consider what might be missing to cover potential scenarios such as this. This is a fast learning curve.   I have now paid in the cheque and can only wait and see. . . all comments greatly appreciated, thank you again.