Abandonment¬†– The surrender of a tenancy without adequate tenant notice.
Agent¬†– An agent acting on behalf of the landlord who may be involved in the letting, rent collection, management, estate agent or other duly authorised person.
Arrears¬†– Money that is unpaid by a tenant in whole or in part after the date specified in the tenancy agreement.
AST (Assured Shorthold Tenancy)¬†– An assured shorthold tenancy offers the landlord a guaranteed right to repossess his/her property at the end of the term stated in the tenancy agreement.
Asking Price¬†– The amount of rent or sale price advertised before negotiation.
Block Management¬†– Refers to agents acting on behalf of freeholders and leaseholds for blocks of apartments and flats. Normally this involves organising internal cleaning, garden maintenance, insurance and redecoration.
Bills¬†– Utility Bill: gas, electric, water, sewerage costs. Other bills such as telephone, internet, TV and TV license.
Break Clause¬†– A clause sometimes inserted in a fixed term tenancy, typically if the initial fixed term is for a year or more. A break clause will usually allow either landlord or tenant to give two months written notice at any stage after a particular date or period of the tenancy, thus terminating the tenancy earlier than the end of the original fixed term. If the initial tenancy is renewed a break clause may be requested if either party do not know if the can continue the contract or not. May also be referred to as a Release Clause.
Buy to let mortgage¬†– A type of mortgage that is designed specifically for people buying a property with the intention of then letting it.
Capital Gains Tax¬†- Tax payable on the sale or transfer of property after any exemptions. A house formerly occupied by an owner will normally automatically be exempt from the first three years of any gains. Living in a house whilst renovating is not classed as residency.
Certification¬†– Checks required by law for rented property include gas, electric, fire safety, EPC, etc.
Check In¬†– The process of enabling tenants access to their new rented home and ensuring all is well.
Check Out¬†– The process with vacating tenants and ensuring the property is in a fit state.
Cleared Funds¬†– When transferring money from a tenant or landlord account to an agent, money leaves the donor account by may take time to be received or visible in the agent’s client account. Letting rules require compliant letting agents to ensure they are in receipt of cleared funds prior to acting in reliance of those cleared funds. An agent may be held negligent and responsible for the consequences of acting prematurely. The temptation to do so is heightened by the pressure to act quickly in an emergency – agents must remain calm and wait.
Commencement date¬†– The date the tenancy starts.
Company Let¬†– Let to a bona fide company.
Contract¬†– A legal agreement between the seller and buyer of a property which binds both parties to complete the transaction.
Contractual Term¬†– A fixed period of time stated in a contract referring to the time that the contract will last.
Council Tax¬†– A local authority tax for England, Wales and Scotland, which is usually the responsibility of the resident to pay.
County Court Judgement (CCJ)¬†– Whenever someone fails to pay for something and is subsequently taken to court, the magistrate may issue a County Court Judgement against that individual to pay the outstanding debt that will only be removed when the debt is cleared.
Deposit¬†– A monetary amount held by the landlord or agent for security against damage to a property. In Britain approximately the equivalent to six week rental is held. In April 2007 a new system was introduced in England and Wales for Assured Shorthold Tenancies. The new Tenancy Deposit Scheme mixes custodial and insurance backed deposit holding mechanisms. The landlord or agent must register the tenancy details within 14 days of the tenancy start. At the end of the tenancy the tenant has to be notified of any deductions within a given time.
Damage/Dilapidation¬†– Damage to a property or contents caused by a tenant as determined at the end of a tenancy. Damages¬†that exceeds acceptable wear and tear.
Deposit Protection Scheme (DPS)¬†-¬†Your landlord must put your deposit in a government-backed tenancy deposit scheme (TDP) if you rent your home on an assured shorthold tenancy that started after 6 April 2007. They make sure you‚Äôll get your deposit back if you meet the terms of your tenancy, don‚Äôt damage the property and pay your rent and bills.
Due Diligence¬†– A process of performing duties to the generally accepted professional standard.
Duty of Care¬†– An obligation owed to others, specifically Landlords and Tenants, to provide the correct advice regarding lettings and ensure the well being and safety of those who may visit the property.
Draft Tenancy¬†– A copy of an agreement potentially unpopulated with sufficient information to enable objection or agreement prior to signing.
EPC¬†– Energy Performance Certificate ‚Äì part of a home information pack.
Eviction¬†– The legal process required to end a tenancy usually where the tenant defaults in some way with regard to tenancy obligations. A court order is required.
Execute a Tenancy¬†– The procedure to finalise a legally valid tenancy by dating the Original (signed by the landlord) and the Counterpart (signed by the tenant) and exchanging them. The date is legally considered to be the date on which the agreement was made.
Fixed Term¬†– This describes a tenancy with an established start and end date as opposed to a periodic tenancy which continues on a month by month basis following the end of term without the new requirement to renew the tenancy.
Fixtures and fittings¬†– Items usually provided in a letting that may include curtains, carpets, blinds, light fittings, kitchen units and appliances. In some cases it may also include furniture. It is advisable to check what is provided and not to assume that items will be provided.
Gas Safety Regulations¬†– The Landlord must ensure that a gas safety check is carried out prior to a let and then annually after that. An authorised CORGI registered engineer must carry out the check and a copy of the record must also be given to the tenant.
Guarantor¬†– A person who is prepared to guarantee rental payments and other obligations of a tenancy to a Landlord. The guarantor is liable for rental payments if a tenant is unable to pay them, so the guarantor will need to have a regular income. References or credit search references will usually be taken up on a guarantor.
Handover¬†– The time when tenants are allowed occupation of a property.
HMO¬†– House in multiple occupation, refers to bedsits or flats which normally offer a self-contained room with either cooking facilities in the room, a shared kitchen or shared bathroom and toilet facilities. Under the Housing Act 2004 it will cover any property occupied by more than one household that is a converted building even if the flats are not self contained.
Identification¬†– Upon instruction all Landlords must provide photo ID and proof of ownership of the property to be rented. Upon application for the tenancy, all Tenants must provide photo ID and must undertake a referencing process.
Improvement Notice¬†– Where a property requires remedial work to bring it up to an acceptable standard the local authorities can serve and improvement Notice upon the managing agent or landlord. Failure to act upon such a notice is a criminal offence.
Initial Term¬†– This describes the first period of the tenancy.
Inspection¬†– Most inspections are inspected every three months to determine the property is in a safe and acceptable condition. This inspection is compared with any previous checks and any repairs noted and attended to. Notice must be provided to the Tenant 24 hours in advance of inspections. Final inspections at tenancy end (check outs) are compared with pre-tenancy arrival inspection (check-in) to establish the extent of any dilapidations during the tenancy.
Inventory¬†– An inventory details the contents of a property and can include the state and condition of a property including the fixtures, fittings and the garden. They should be checked in with the tenant at the start of the tenancy and then checked out with the tenant at the end. Often a professional inventory clerk is employed to carry out the inventory.
Joint & Several Liability¬†– Where there is more than one adult living in the property, the tenancy will say they are ‚Äújointly and severally‚Äù responsible. This means that, jointly, the tenants are liable for the payment of all rents and all liabilities falling upon the tenants during the tenancy, as well as any breach of the Agreement. Individually each tenant is responsible for payment of all rent and all liabilities falling upon the tenant, as well as any breach of the Agreement until all payments have been made in full.
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Landlord¬†– A person, persons, company or body that has the right to let the property. Accidental Landlords by virtue of unplanned or unintended circumstances now rent property. Resident Landlords provide accommodation to their lodger tenants. Non Resident Landlords live in property let by a landlord who is not resident.
Lease¬†– Often confused with tenancy agreement this is normally a long lease on an apartment. The actual document governing a rental is normally known as a Tenancy Agreement.
Letting¬†– An agreement to let a particular property.
Maintenance¬†– This is on-going upkeep of the property and relies on the tenant to notify any defects or issues which arise, either to the Landlord or the managing agent.
Maintenance Charge¬†– A charge payable covering the cost of repairing and maintaining the external or internal elements of communal parts of a building, prevalent in flats and apartment buildings.
Managing Agent¬†– A professional or company responsible under an agency agreement for the maintenance and management of the property.
Money Laundering Reporting Officer (MRLO)¬†– Under the Money Laundering Regulations 2007 Agents are required to report suspected fraudsters to the authorities.
Move Ins¬†– The process of enabling tenants access to their new rented home and ensuring all is well.
Move Outs¬†-¬†The process with vacating tenants and ensuring the property is in a fit state.
NRL 1¬†– A Non- Residence Landlord Scheme form which is sent to the Inland Revenue.
Non- Refundable Deposit¬†(NRD)¬†– A non-refundable deposit required to reserve a property. Provided the reference checks are satisfactory, and the tenancy proceeds these monies are deducted from initial month’s rent.
Notice Period¬†– The amount of notice that the Landlord must give the Tenant to end the tenancy and vice versa.
Owner Occupier¬†– The person who owns the property who is, has been and will be living in the property as his sole or principle residence.
Parties¬†– Landlord and tenant (and possibly a guarantor) who come together to sign a tenancy agreement are collectively known as ‚ÄòParties‚Äô to the agreement.
Payment¬†– Rent for accommodation, bills¬†- for utilities like gas, electric, water, sewerage, internet, etc.
PCM¬†– Refers to a Rental figure and stands for per calendar month.
Pets¬†– Permission to allow pets cannot be unreasonably withheld under the ‚Äòunfair terms and conditions‚Äô rules. In a family home it is more likely for agreement to be given for pets, however, in apartments there is often a clause in the ‚Äòhead lease‚Äô stating no pets, and the landlord cannot go against the head lease. Upon agreement of a pet, the tenant will be asked to sign an addendum stating the requirement for additional cleaning, repairs to damage caused by scratching or chewing and de-infestation of carpets and soft furnishings at the end of the tenancy.
Periodic Tenancy¬†– Either Contractual Periodic whereby a tenancy is contracted by agreement to run from month to month, or Statutory Periodic which refers to when a fixed term comes to an end and the tenant remains, by agreement, in the property under the same terms and conditions as the original agreement and runs from month to month or quarter to quarter, depending upon the basis on which the rent is paid.
Portfolio¬†– A number of properties owner by one owner/landlord.
Portfolio Landlord¬†– A landlord owning more than one property and often let by the same agent.
Power of Attorney¬†– A legal document giving a third party an absolute or limited right over the principal‚Äôs property and assets.
Prescribed Information¬†– This refers to information which the Housing Act 2004 Sections 213 (5) – (6) and The Housing (Tenancy Deposits) (Prescribed Information) Order 2007 require to be provided to the tenant within 14 days of the deposit having been received.
Professional¬†– This describes a working tenant.
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References¬†-¬†Allows a Landlord to check a tenancy applicant‚Äôs suitability to be able to pay the rent and also the applicant‚Äôs track record in earlier rentals. This often involves contacting previous landlords, the present employer or accountant if self-employed and bank.
Renewals¬†– This refers mainly to a fixed term tenancy which, following expiration may result in a new fixed term tenancy being granted. In opposition to a periodic tenancy, which permits tenants to remain after the tenancy expires without the need to renew for a further set period time.
Rent Frequency¬†– The regularity with which rent payments are payable, e.g. monthly, quarterly, 6 monthly. If rent is paid weekly a rent book must be provided.
Repairs¬†– Under Section 11 of the Landlord and Tenant Act 1985 Landlords must maintain the structure and exterior of the property including drains, gutters, external pipes, etc. Maintain in working order the supply of water, gas, electricity and sewerage. Maintain in working order the heating and hot water.
Resident Landlord¬†– Where the Landlord occupies part of the dwelling as his main or principle home and lets the rest of the property.
Section 21 Notice¬†– The notice which must be served to end a tenancy. This can be served at any time after the deposit has been properly registered with an approved scheme but not less than 2 months before possession is required. A Section 21(1)(b) notice must be served to end a fixed term tenancy. A Section 21 (4)(a) must be used to end a periodic tenancy. In this case of a periodic tenancy, it must be served after term ends and expires following 2 mths after term ends. Example: let for 6 mths starting on 1 Jan. Term ends 30 June. Notice served 15 July. Notice expires after 30 September.
Section 8 (1985 Landlord and Tenant Act – Notice to Quit – Grounds for Eviction)¬†– This has 17 grounds for evicting a tenant – the first 9 are mandatory i.e. the judge has no discretion and must grant eviction. Grounds 9-17 are discretionary – the judge will act as s/he sees fit and fair.
Signatures¬†– AST’s are not required to be signed – but for certainty it is wise to avoid dispute about what is agreed and ideally witnessed to avoid issues of signature authenticity or ownership.
Standing order¬†– Standing order mandate is an instruction that the tenant makes to their bank for payment of rent. Normally payments are made each month and the instruction will state the number of payments or will continue to be paid until cancelled by the tenant. A landlord or agent cannot cancel a standing order mandate, only the person whose bank account the fund are coming from. A standing order should not be confused with a Direct Debit, which is not often used for the payment of rent and is more common for payments that differ each month.
Statutory Obligations¬†– Requirements and obligations placed on Landlords and/or their agents by Acts of Parliament i.e. Law of the Land.
Statutory Periodic Tenancy¬†– If at the end of a fixed term tenancy, neither parties do anything and no further agreement is made, the tenancy will automatically run from one rent period to the next on the same terms as the preceding fixed term assured shorthold tenancy. It will continue to run on this basis until replaced by a new agreement or by one party giving the other notice. Once notice is served, it will only be effective from the start of the next period of renewal and will end on the last day of that period. The tenant will have to provide not less than 1 months‚Äô notice and the landlord not less than 2 months.
Studio apartment/flat¬†– A flat with a bedroom and living room all in one either with a separate kitchen or corner of the main room as a kitchen, with a separate bathroom and toilet.
Subject to Contract¬†– Signifies that an agreement is not yet legally binding.
Sublet¬†– The action of a tenant letting accommodation to be occupied by another person for a lesser term.
Tax Exemption¬†– An exemption number issued by the Inland Revenue Office (FICO) to your agency approving the passing of rents to the customer without a tax deduction.
Tenant¬†– A person, persons, company or organisation who is entitled to occupy a property under the terms and conditions of a tenancy agreement.
Tenancy agreement¬†– A legal binding document containing details about rental terms that is sometimes referred to as a rental agreement. It will state the parties, i.e. the landlord and tenant(s), the rental price and the property address along with the Covenants/obligations of the let.
Tenancy Deposit Scheme (TDS)¬†– Run by the Company for the protection of tenancy deposits and the resolution of disputes between landlords, agents and tenants concerning the return of deposits at the end of a tenancy. The TDS is a mandatory scheme that has been set up in accordance with the Housing Act 2004.
The Term of Tenancy¬†– This refers to the length of a tenancy. Most initial tenancy agreements are for a minimum of six months, although they may be shorter and longer.
Termination¬†– Refers to the ending of a tenancy.
Utilities¬†– These are normally electricity, gas and water and may be referred to as services which, under most circumstances, the tenant is responsible for paying for.
VAT¬†– VAT is currently 20% and as a VAT registered company Bishop Sullivan will be required to add VAT to all invoices for landlord and tenant services.
Viewings¬†– The process of visiting a house to ascertain whether it is suitable or the best available from a range of properties
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Yield¬†– Refers to income from a property calculated as a percentage of its value.
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