I bought a property with a long-time tenant, but none of us have a proof of rent: I was not given rental papers when I bought it and the tenant says he can`t find them. What is the best way forward? Geoff greetings Depending on the type of contract the tenant has, they could continue to live legally on the site after the sale. It also saves the new owner time and money when searching tenants` credit history, employment references and deposit guarantee system. When you decide whether a lease is maintained with existing tenants, you should consider or ask: It often happens that a buyer pays less for a home when sedentary tenants are present. However, you should be aware that some mortgage lenders refuse to finance such purchases, so you should keep this in mind. In addition, sedentary tenants have the right to pay a “fair rent.” A fair rent is set by a tenant or a rental court. Since 1999, increases have been limited by inflation. This may be possible if the lease is a guaranteed short-term lease agreement, in some cases through the issuance of a so-called Section 21 communication or a Section 8 notification. While you can legally sell a house with a seated tenant, you cannot necessarily evict a sitting tenant simply because you want to sell your home. Tenants with these tenties are generally considered sedentary tenants, since they do have the right to occupy the property permanently. Once the buyer has entered into the property, he also takes over the ownership of the lease agreement entered into by the previous lessor. In most cases, the lease is an AST (Assured Shorthold Paus), which means that the new owner may have the right to dislodge the tenant from the property by a section 21 notice.
Remember that the value of a home with a seated tenant can be much lower than the same house without a sitting tenant. It may be difficult, if not impossible, to find someone who would like to buy with a tenant on site. When the new owner buys the building, they will take ownership of your existing lease. If your lease is a short-term lease (ASSURED Shorthold Lease), it is bound by the current contractual terms. Often, rental properties are sold to another landlord, which could mean that your lease will continue as it was for you or for your existing agreement with little or no time change. Sure, you have a new owner, but everything else stays as it is. Selling your home to a bar buyer, with a seated tenant, can be a quick and easy way to solve your seat rental problems. A “sitting tenant” is another definition of a tenant protected by the Rent Act 1977 and who has more rights in the law than a tenant of the TSA.
One of the problems when selling a home with a seated tenant is that it can be difficult for the buyer to get a mortgage. Most banks and real estate credit companies will not mortgage a property with a sedentary tenant, especially a regulated tenant. Those who agree to lend to a leased property generally charge a higher interest rate and offer only a lower LTV or value credit. Tenant right A sedentary tenant has the right to occupy a life-long property without disturbance and, in the event of the death of a sedentary tenant, they may pass the lease on to a spouse or other family member. Even if the property changes ownership, it is almost impossible to scare away these tenants because their rights and obligations do not change. The majority of tenants will respect your decision, even if they don`t like it, and allow them to proceed without incident. Of course, there will always be some that will make it difficult for the owner, but it should simply be attributed to the cost of the activity.