It's an issue private landlords see quite often. Two or more people move into a property and are happy to sign a joint tenancy agreement. All goes well until suddenly one of the tenants decides they want to leave before the end of the fixed term. This obviously causes problems. Especially if the other tenant(s) wishes to stay in the property. But what do you the landlord do when this happens? What's the situation with the tenancy? And the remaining tenants?
When two or more people sign a joint tenancy agreement they become responsible for the rent. The tenancy agreement applies equally to each person. Whichever way they choose to divide the rent between them, whichever mechanism they use to actually pay the rent isn't something which should concern the private landlord. Though you must insist you receive the rent as a single payment.
In other words, if there are two tenants you only want to receive one payment. Not a payment from each of the tenants.
If the rent isn't paid the tenants are jointly liable for the arrears. Regardless of the arrangement, they made between them. Similarly, and what is relevant to this article, joint tenants are seen as a single entity when it comes to living in the property. At the end of a fixed term, all tenants must move out. And, if one tenant should decide to leave the property before the end of the lease, the remaining tenant(s) must also leave.
If one of the tenants does leave or doesn't pay their share of the rent the other tenants must pay it. Should no payment be made by any of the tenants you can ask any of the tenants to pay the arrears. If arrears build up or the tenants have left the property without paying the rent you can pursue one or all of them through the courts to recover the debt.
There are a few different scenarios. If there are two joint tenants a thawing in their relationship could prompt one to leave. This is probably the most common reason for a joint tenancy breaking up. Whether they are partners, friends or work colleagues a falling out prompting one to leave will cause financial issues. Can the remaining tenant afford the rent which has now effectively doubled?
But there are other circumstances when tenants who are just friends or housemates can lead to one leaving. Even when their relationship is fine. A job loss or cut in hours can lead to a tenant no longer being able to afford the rent. Their only option is to move out.
Or starting a new job in another town or a change in family circumstances can also lead to the breakdown of a joint tenancy. Whatever the reasons there are ways for a tenant to end the joint tenancy.
But, you the landlord hold the power here. Remember tenants are bound to pay rent for the duration of the fixed term. Should they leave before the end of the tenancy without your agreement they are still liable for the rent?
If the tenancy is still in its fixed term there is only two ways your tenants can end the agreement early.
If the fixed term has ended any one or all of the tenants can give you notice to quit. Usually, a month's notice is required. Even if only one of the tenants gives notice all the tenants must leave at the end of the notice.
If one or more tenants want to stay in the property you have a decision to make. If you're happy for them to remain you can draw up a new tenancy agreement. However, you do need to carefully consider the financial consequences. The remaining tenant(s) share of the rent has just gotten larger. If you have any doubts about whether they can afford the rent you should terminate the tenancy.
If a tenant leaving results in the rent not being paid you must act fast. Don't let the arrears build up. You'll have the tenancy deposit and this can be used to cover any outstanding rent. But it's in your interest to ensure the remaining tenants move out promptly. If they stay too long the deposit may not cover the eventual arrears. This is why you should seriously consider evicting all tenants once the joint tenancy agreement has been broken.
If you evict one tenant whether under Section 8 or 21 all must leave. Remember joint tenants are considered to be a single entity. Even if you only wanted to evict a single tenant you have no choice.
For example, if during the fixed term one tenant has been disruptive or causing problems you can evict that tenant. But the possession order applies to all joint tenants so all must leave. You can, of course, they choose to offer a new tenancy to the remaining tenant(s) but a new tenancy agreement must be signed and deposit paid.
Private landlords can find tenants fast by listing their property with MakeUrMove the original online letting agency.