UK Landlord Forum / Life

Been in property 6 years, never missed a payment

went away for a few days holiday to come back to a note on my door telling me the house is in "receivership",  spoke to them,  the bank are now my new landlord with a new managemnt company,  they want me to prove i have the right to live in the property etc, i have done this,  they now want me to transfer the deposit from "mydeposit"  to them,  i spoke to my deposit and they dont have it, they claim the landlady kept it 6 years ago, i have paperwork from Mydeposit saying "deposit protection cerftificate",  they are saying it has nothing to do with them and i have to try and get it back from my LL who i can now no longer get hold of,  the new management company are trying to say  i need to provide them with a new deposit and recover the deposit my self,

the problem i have with that is the company that "owned" my property has gone bust, but the landlord hasnt,  but all my paper work only states her name and no where mentions the company that owned the house.  ie tenancy agreement,  the deposit certificate

i have also been informed that the bank will serve me with a section 21 soon as they will want to sell the house as they dont want the hastle of being landlords,  i was expecting this anyway

my questions is,  where do i stand with the deposit,  who do i claim it back off, as my old landlord is meant to still have it, my new landlord wants a new one off me and the deposit people are saying nothing to do with them,

cheers

You're looking pretty good at the moment, I should think.  I think you've been dancing to their tune when you don't need to.  Don't panic and don't be a pushover.  You'll definitely be evicted eventually, but in these circumstances the law gives you extensive protection.

You paid a deposit in good faith and you have a certificate to say so.  Explain to the new management company that it's for their client, the bank, to recover the deposit that you paid from their borrower in default and you certainly aren't going to pay it again.  And then tell them that as you've already paid a deposit, what they're demanding constitutes a "prohibited payment" within the meaning of the Tenant Fees Act 2019.

Next, tell them that if they haven't protected your deposit in a deposit protection scheme, then they can't serve a valid section 21 on you.  By the way, I suggest that you tell them all this in writing, by means of a proper letter.

They may try to get a copy of the tenancy agreement you signed.  They may well ask for a copy of the inventory.  Do not in any circumstances provide these things, unless they offer to pay you handsomely for them.

Tell them that you're concerned this may be a scam, and they need to provide evidence that they own the property.  Explain that you won't be paying any rent until they do.

Then really do actually stop paying the rent, because they're going to evict you eventually and when they do, you're going to tell them that they need to reclaim the outstanding rent from the deposit that you paid.

They will respond with all kinds of bluster and threats, which you can quite safely ignore until you get a Court date.  Regardless of what they threaten you will not actually be taken to Court.  Find somewhere else to live in the next few months, though.

Stop paying rent until you have definitively establish who is legally entitled to it. Don't spend it though, you do have to pay it eventually.

First, work out exactly who was your landlord at the start of your tenancy to then work out who is legally your landlord currently. If the landlord in your most recent tenancy agreement stated that A_PERSON is landlord, and only B_COMPANY went bust, then A_PERSON is still your landlord. That B_COMPANY (whose director was A_PERSON) was the legal owner of the house does not change that. If the property was on buy-to-let with the company, that's going to create its own problems though.

Have you checked Companies House to see the status of the company? I would also say pay £3 to check the land registry, but recent change in ownership may not be updated yet, but at least you will find out for definite who was owner of property and if on mortgage, who was the lender.

Quotethe new management company are trying to say  i need to provide them with a new deposit and recover the deposit my self

Even assuming they are now your landlord, don't do it, they can't require you to provide a new deposit.

Quotewhere do i stand with the deposit,  who do i claim it back off, as my old landlord is meant to still have it, my new landlord wants a new one off me and the deposit people are saying nothing to do with them

Double check with all 3 deposit companies that it's not currently protected with any of them.

What you wrote imply that the mortgagee repossessed the property. If that did happen and the mortgagor was your landlord and you paid them a deposit, it would make you a creditor. The new landlord mortgagee bank don't owe you a deposit, and they can't make you pay them a new one.

QuoteExplain to the new management company that it's for their client, the bank, to recover the deposit that you paid from their borrower in default

Quoteyou're going to tell them that they need to reclaim the outstanding rent from the deposit that you paid.

The mortgagor doesn't owe the deposit to the mortgagee as it's the tenant's money. The mortgagee have no entitlement to it.

QuoteAnd then tell them that as you've already paid a deposit, what they're demanding constitutes a "prohibited payment" within the meaning of the Tenant Fees Act 2019.

No it isn't.

QuoteNext, tell them that if they haven't protected your deposit in a deposit protection scheme, then they can't serve a valid section 21 on you.

The new landlord have not received a deposit as the existing deposit that was paid to the mortgagor doesn't get transfered, so they have nothing they need to protect.

QuoteRegardless of what they threaten you will not actually be taken to Court.

That's a quite clairvoyant prediction to make. 

It won't come to Court in the timescales we're talking about here. The bank will drop the case when they get possession because it's uneconomic.

The bank aren't entitled to demand a second deposit in the circumstances. They're trying to make this the tenant's problem and it isn't and shouldn't be. This poster is never going to recover his deposit if he accepts that he's a creditor.

I'm recommending an energetic approach to the matter on the basis that the bank have foreclosed and will recover their losses from the delinquent landlord's equity in any case. I do realise that it would be possible to take issue with some of the detail -- it's obfuscation and delay to achieve the result of recovering the deposit by way of not paying rent.

A bit legalise this, but a property I let on a mortgage had the minor complication of the Lender wanting this kind of Clause putting into the AST:

The Landlord will obtain any necessary consents to let the Property. The Property is subject to a Mortgage with Yorkshire Building Society and this tenancy can be terminated under Ground 2 of Schedule 2 of the Housing Act 1988.

This exact text satisfied them when they saw the AST and approved it. I wonder, if such a similar clause is not in any agreement you signed, whether it makes eviction more difficult in any way, shape or form. I have seen commentary that indicates it's kinda irrelevant, but some Lenders still insist on its inclusion, for dogmatic reasons, I suppose, YBS are quite staid in their approach (to everything - been "thinking about an App" for years).

Don't pay out another Deposit, whatever you do. I think the "Deposit people" are correct in that it's nothing to do with them... first stance - no extra Deposit to the new owner, second stance - find out what happened to your original Deposit... it's possible the Landlord could've moved it (seems doubtful)... but find out all the whens and wheres then let us know... because there's possibly some fish in a barrel here.

thanks for all the replys

will try and answer a few questions

the landlords companys has gone in to admin according to company house,  but she hasnt,

the deposit people keep telling me they will phone me back when i try to raise a dispute over the deposit

the "mortgage works" sent me a letter today saying they own the house and have appointed the LLP to deal with it, and they inc a letter saying "appointment to act as a receiver"  which they sent to the LLP people



If the landlord in your most recent tenancy agreement stated that A_PERSON is landlord, and only B_COMPANY went bust, then A_PERSON is still your landlord. That B_COMPANY (whose director was A_PERSON) was the legal owner of the house does not change that. If the property was on buy-to-let with the company, that's going to create its own problems though.

this is what has happened, by AST is in her name, the company has gone bust and they are claimng the house

am i right in assuming the bank just cant turn up and take the house with out a court order,  as they where claiming they could change the locks if they could prove the property was vacant

I advise you to get proper legal advice unless you have plans to vacate soon, and to do so before you communicate with the people claiming to now be the landlord / owner of the property as you don't want to inadvertently say something that put you in a worse position.

Based on your descriptions, I would say the individual is still the landlord unless that title been assigned seperately. However, your problem is that if the mortgage, presumingly BTL, was with the company, the individual probably did not have permission to let it out in her name. In that case, the new owner may not even need to serve you s21 notice etc. but can go straight to court for possession using their title paramount. A mortgagee in possession can cause an illegal tenancy to become binding by demanding rent, but I guess that wouldn't happen here since they not gotten possession from the previous landlord, but a seperate legal entity.

Your best bet may be for all parties (the old landlord, the company, the bank, and you) to proceed on the basis that the bank is now the landlord if you can.

Quoteam i right in assuming the bank just cant turn up and take the house with out a court order,  as they where claiming they could change the locks if they could prove the property was vacant

Generally yes, but you may not know there's a court hearing in certain circumstances though now that they know you're there, I don't imagine any would apply.

The Mortgage Works only offer buy-to-let mortgages.  It's a trading name for the buy-to-let arm of the Nationwide Building Society -- I have three mortgages with them myself.  By definition, a mortgage with them is a mortgage with consent to let.

Quote from: Mortimer on August 19, 2019, 09:19:11 PM
By definition, a mortgage with them is a mortgage with consent to let.

I don't think a consent from the mortgagee for the company mortgagor to let gives permission to the individual to let, unless the company had let it out to the individual to sublet rather than just (implicit) permission to do so without estate. I doubt the lender consent extend to sublet either, especially when the tenant mense tenant is related to the mortgagor.

I'm not sure that matters?  The Mortgage Works knew that this property was let to a tenant.  I don't see how they can possibly get out of Housing Act 2004, section 215.

From this tenant's point of view I do still very much feel that he's at risk of losing his deposit in the argument between mortgagor and mortgagee in possession.  The safest way is for him to find a pretext to withhold enough rent to cover his full deposit, locate somewhere else to live and move into it, and then tell the Mortgage Works that they need to deduct the missing rent from the deposit.  I don't think they'd fight that -- it would be uneconomic for them to do so -- so I'd recommend that he takes a very strong line with the bank.

It make a difference because a tenancy that was granted with consent to let is binding to the mortgagee if they subsequently come into possession. A mortgagee in possession can displace a tenant of a non-binding tenancy without worrying about the terms of the tenancy, s21 etc. If binding however, normal (e.g.) AST rules applies.

bit of a update,  the bank have asked for rent off us, saying they will honor the tenancy,  (but wont say for how long, but did send someone to value the property today) the deposit people have said she did lodged teh deposit with them only insured it,  and if she has gone bust then she is out of the scheme and the deposit isnt protected and i will have to get it off her my self, but if she isnt bust there insurance will cover it if they cant get it back,  but they wont do anything until i am out of the house

we have decided to just move out, as cant live in limbo with 3 kids and a misses not knowing if we will get a notice to leave any day

Quote from: madalikat on August 23, 2019, 07:30:49 PM
the deposit people have said she did lodged teh deposit with them only insured it,  and if she has gone bust then she is out of the scheme and the deposit isnt protected and i will have to get it off her my self, but if she isnt bust there insurance will cover it if they cant get it back,  but they wont do anything until i am out of the house

Either there's some lost in translation, or they're contradicting their own rules.

(I'm going to assume MyDeposits Insurance scheme because that's who you mentioned before.) If the deposit is currently validly protected, then per their own scheme rules, if they wish to cancel the protection, they have to serve 14 days notice of suspension to the member (i.e. landlord), then a decision to cancel, then they have to give the tenant 3 months (from when the notice to suspend member was served) notice that the deposit will be unprotected. If they haven't done that yet, then the insurance must still cover it.

Quote from: KTC on August 23, 2019, 10:02:37 PM

Quote from: madalikat on August 23, 2019, 07:30:49 PM
the deposit people have said she did lodged teh deposit with them only insured it,  and if she has gone bust then she is out of the scheme and the deposit isnt protected and i will have to get it off her my self, but if she isnt bust there insurance will cover it if they cant get it back,  but they wont do anything until i am out of the house

Either there's some lost in translation, or they're contradicting their own rules.

(I'm going to assume MyDeposits Insurance scheme because that's who you mentioned before.) If the deposit is currently validly protected, then per their own scheme rules, if they wish to cancel the protection, they have to serve 14 days notice of suspension to the member (i.e. landlord), then a decision to cancel, then they have to give the tenant 3 months (from when the notice to suspend member was served) notice that the deposit will be unprotected. If they haven't done that yet, then the insurance must still cover it.

i am just going off what they told me, they where saying once she is bankrupt she is no longer in the scheme and the bond isnt protected,  i got a feeling they hope i walk away,



anyway i  got served with a section 21 today,  they spelt my name wrong