Live-in landlords or “resident tenants,” as they’re sometimes known, are homeowners who rent out their properties to lodgers who share ownership with them and aren’t technically tenants; both landlords and tenants must sign an Assured Shorthold Tenancy Agreement (AST), however. Furthermore, special rules must also be observed regarding lodging arrangements between both parties involved.
If you’re thinking of renting part of your property to lodgers, this article outlines essential points that need to be kept in mind when creating an Excluded Tenancy Agreement or lodger agreement.
Though lodgers don’t enjoy all of the same rights as tenants do, an agreement makes life simpler for both the lodger and landlord by setting expectations clearly and creating a shared understanding between both parties involved. Should any conflicts arise later on, an agreement could serve to resolve it quickly.
Though lodger agreement templates are readily available online, some landlords prefer creating their own agreement for lodgers. Here are the most essential considerations that landlords should keep in mind when creating this document:
Make the rules clear
Because your lodger will be living in your house, it’s crucial that both parties involved clearly establish what house rules there may be from the start to ensure both are on equal ground. If you do not want them playing music late into the night or leaving belongings around communal areas, be sure to make that clear in their contract.
Contracts should set forth how you’d like your property managed, and this includes providing tenants with an inventory before taking possession. An inventory can help assess its condition before and during lodging as well as record its maintenance over time.
State the consequences
Consequences Should the lodger cause you any discomfort or damage to your property, you need to decide whether you wish to abide by the terms of their contract and allow them to reside at your residence.
Landlords typically attempt to resolve issues through peaceful discussions with tenants and formal letters giving the lodger another chance to correct his/her behavior; if no change occurs then landlords can request that lodger leaves.
Make certain the lease agreement outlines any misunderstanding caused by your landlord and its consequences clearly.
Include Deposit Details
Since lodgers do not legally fall under the category of tenants, you do not need to report their deposits through the government’s Deposit Protection Scheme (DPS). Instead, you can require them to provide an amount that covers damage or missed rent payments.
Clarify in the agreement what the lodger can be expected to pay, as well as how their deposit will be used if any concerns arise.
Be clear on rent
Rent should be treated as the cornerstone of any agreement since it will determine who resides in your home and why they can rent space from you.
Contractual arrangements between lodgers and houses must clearly outline both the amount and date of rent payment.
Most landlords who rent rooms require that lodgers make weekly rent payments to protect the landlord in case they fail to make payments on time. If a lodger misses making weekly rent payments then instead of being charged one month rent it’s best that only a week’s payment be assessed as payment due.
In case rent payments aren’t timely made and lodger falls into arrears on rent payments, it is up to the landlord to determine when and how long before taking action against lodger.
Clarify the eviction process
Lodgers do not fall under the definition of tenants, meaning they are susceptible to being evicted if a landlord gives notice for them to depart the premises or provides enough notice that it’s time for them to leave.
Notices to Vacate are required as part of any lease and should include the number of days you’ll allow the lodger to vacate the property.
Since assured shorthold leases do not require four weeks’ notice for termination, lodgers who pay rent weekly could give as little as one week of notice.
Living in landlords do not require court approval in order to take lodger’s leave; rather this should be stipulated in their lease agreement.