Pensioner tenant behind in rent

This. Agent needs to be registered with Centrepay and it costs the landlord 99c for each transaction that comes through. The tenant doesn't have to set it up.

The cash advance is simply that, an advance - but not for anything specific and Centrelink will usually cap it and won't let you take it out multiple times.

As @thatbum pointed out, VCAT doesn't make orders about how the money is meant to be paid.

16 weeks is a lot of arrears, I can understand a pensioner with only Centrelink income having trouble keeping up from time to time - but when you're 3-4 months in arrears that is a sign that they're taking advantage of your friend with little regard of your friends situation. There's a big difference between someone struggling and trying to do the right thing, and someone that just doesn't care - this person doesn't seem to care and therefore shouldn't receive sympathy for their self imposed predicament.

 

I cannot respond to all the posts. The PM was appointed today, and is fully apprised of the situation. We will wait until early next year and see what happens. If Centrelink can recover a cash advance by a regular repayment, seeking repayment for a much larger sum over a much longer time seems similar and arguable. The PM said that the evidence I prepared backing up the assertion that rent was unpaid was very solid, happy to go to court with this.

Did I mention that there needs to be a new pergola, drive and garden? Until these are done the property cannot be let to another tenant, so the miscreant must stay for a few more months. If there is a judgement against him this will presumably go on the tenancy database, and he will probably find it hard to rent anywhere. If this is made known to him by the PM then he may have a bit more enthusiasm for paying the $4000 a small amount each week.

The most important step is that there is now a PM, and this will most likely lead to less or nil payments missed.

 

It depends if you think going to court is going to achieve anything. You cannot get blood from stone. If the pensioner has no money your just throwing good money after bad

 

I don't understand why this is the strategy if this tenant is owing a significant amount of money for literally coming onto 2 years.

How are things going to get any better?

 

Is the property really run down inside, too? Or just externally?

I can't see the connection between repairs and keeping the current tenant on?

 

The PM will be able to deal with the tenant better than the LL. It's only been a few days since the PM took over, so we need to give it a month or so to see how things develop.

It will be about four months before the reno is completed. So the reno is done while the tenant is in place, and then he is kicked out. The inside is fine, total reno just before the tenant moved in. It's mainly the pergola, drive, garden and garage door, which does not open. After these are done the estimated rent will be $350-375, so it's an immediate $4000 or so in the LL's bank each year. This will easily cover the interest on a loan for the reno.

 

The LL should of addressed this well before now, the longer you leave it the harder it is to get back all the money owing. It really shouldn't of escalated to $4,000 owing but better late than never.

To note with the new rental amount you likely will need to find a new tenant as proving his serviceability will be hard as it will be more than 1/3 his income.

 

Land lord insurance would have been sensible. I cant see how any aged pensioner is going to repay arrears of $4K (25% of a year) and the current rent which you want to jack up. Centrelink wont help you directly or indirectly to get the arrears other than allow the pensioner to borrow $1k (not $500) and he loses pension to repay it. Centrelink will pay that and no more to you...ONCE. $1k take it or leave it. You cant repeat the process. It also comes with a catch - centrelink wont be party to a partial deal if his pension cut + new rent etc harms him.

Eviction may be difficult too. Dont quite understand how a renovation (intended to raise the rent by admission) occurs during a tenancy either. That could be the factor that helps a tribunal rule in old mates favour. He will argue the place had poor condition and you acknowledged it and agreed to fix things up and dropped the rent until it was sorted and now want to move him out and collect the full rent. PMs make lousy lawyers.

There seem more to this than paying the agreed rent - Seems there is a plan to make rent $350-$375pw. at his expense.

Old mate probably will call in a social welfare agency for help and they will provide support to defend this - Tribunals dont like putting aged pensioners of the street esp when it seems you want to jack the rent.

I would see a solicitor before it escalates to a long term low rent tenant. They could waive the $4k and allow him to stay on. He will argue cant cant afford to move ...and so on.

 

The matter went to court last week. The tenant is to pay $50/fortnight on top of the rent. The application has been adjourned for a few years to give the tenant time to pay off the monies. The tenant has got a shock, and is now paying the rent on time. He said he will attempt to pay more than $50 a fortnight. He agrees that he has been remiss. The LL and PM are both pleased with the outcome.

 

Good outcome!

 

At 25 a week its going to take a couple yrs to catch up though?

 

Probably all he can afford, which makes it the best result short of asking him to leave.

There's a two fold benefit of this decision.
1. Assuming the tenant continues paying religiously, the court case has resulted in him paying his weekly rent every week (which obviously wasn't happening before), plus the little extra, so it's effectively worth somewhere more than $25 per week.
2. If the tenant falls back into old habits and he needs to be asked to leave, it should (we never know with VCAT...) be a lot easier to get him out since he failed to comply with this court ruled payment plan.

 

It will take years to pay. I was hoping for $50 a week, as this would see the debt gone by late 2018. No matter. At least now the LL has LL insurance to fall back on.

 

The Landlord can't be covered for the arrears in this situation because there's a pre-existing issue?

 

Yeah it's too late now to claim it through LL insurance and it would be fraud if you did anyway.

 

I am unsure. The payments are being applied to the oldest dates, so that when he pays for the current fortnight plus $50, this applies to, say, five months ago. In a few months he will have reached the point where the PM was appointed. My undertanding is that LL insurance applies for when there is a PM, so it might be that any monies owed for after the PM is appointed are covered.

The LL insurance PDS is unclear on this - it's probably unusual. I was aware that LL insurance did not cover the situation until a few months ago. At this stage it's academic, and will hopefully stay so The tenant was paying on time before the hearing, and has said that he will attempt to pay more than $50 a fortnight, so an insurance claim may not arise.

Any claim will be closely examined for compliance with the insurance PDS. There is no intent to commit fraud.

 

I don't know of any policy that will cover rent claims if a policy is taken out while the tenant is behind.

 

The policy was taken out before the tenant was behind and when the LL was self-managing. This was years ago. Since then the policy has been renewed. One remedy may be to cancel the policy and then start another policy with another company. The PM can advise about this. I'm advising that laws not be broken.

Page 24 of the Terri Scheer PDS says that:
"If the tenant’s rent payments were in arrears in the 2 months prior to the commencement of the Policy, then rent cover is not available unless the ‘Rent arrears’ clause has been met".

The policy requires a PM, so it may be that until now it had no effect.

I'll suggest that the PM sort this out ASAP.

 

Oh that's strange, so the Landlord has being paying for invalid insurance for years?

 

Quite so. I may have said that the LL was not doing a very good job.