Coronavirus (COVID-19): How we can help you and your business

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COVID-19: Help for landlords

COVID-19: Coronavirus continues to impact people and business world-wide. We are fully operable and are able to help you through these difficult unprecedented times.
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The coronavirus outbreak has seen the world facing unprecedented times, with strict measures being implemented worldwide to curb the spread of the disease. In the United Kingdom, measures put into place by the government have seen many businesses unable to operate, and thus, a large number of people unable to work.

Certain safety-nets have been put in place for individuals affected by the outbreak. These include protection for renters across the country, who may find themselves in a position where their liabilities become unaffordable. Should they find themselves unable to fulfil a rent payment, no action can be taken against them to retrieve this during this period. Landlords also have to give renters 3 months’ notice if they intend to end the tenancy.

Though necessary, these measures have brought with them anxiety for landlords up and down the country, who fear that they may face financial difficulties if such income were to grind to a halt.

What if my tenant cannot pay their rent?

If your tenant should find themselves in a position where part, or all of their rent becomes unaffordable, they are protected by the coronavirus act 2020. This emergency legislation stated that landlords may not evict or pursue tenants for this unpaid amount.
While residential mortgage-payers have been protected by this legislation, giving them a holiday period from their payments, landlords with mortgages on ‘buy-to-let’ properties have not. This means that, should your tenant’s payments drop or halt, you will be left with the same outgoings as normal, with a lower income to cover these.

This may understandably cause financial difficulty for landlords nationwide, hence the anxiety mounting amongst them. However, there are a number of options available to help you, should the situation come to the worst.

What help is available for landlords?

If you should find yourself in financial difficulty owing to reduced income from tenants, there are several options available to you from insolvency professionals such as ourselves. These include:

  • Arranging an affordable, monthly repayment plan

For sole trader landlords

If you have outstanding debt, and a drop in income would see you face difficulty in repaying this, we can help. The process of an individual voluntary arrangement (IVA) evaluates how much of your outstanding debt you can afford to repay in these circumstances. The outstanding amount is broken down into affordable monthly repayments, as part of an arrangement with creditors set out over an agreed period (maximum of five years). During this period, you are protected from creditors taking action against you, so long as the terms of the arrangement are adhered to.

For limited companies

If you operate under a limited company, a similar repayment arrangement can be put into place through a company voluntary arrangement (CVA). An insolvency practitioner (IP), such as ourselves, works alongside your creditors to evaluate the affordability of the debt, and to install a monthly-repayment arrangement for a term of up to five years. This protects the company from creditor action, so long as the terms of the arrangement are met. If your debt becomes unaffordable, it is crucial to act quickly before the situation gets out of hand, as failing to do so could lead to critical damage to your business. Get in touch today to discuss this option for free with one of our experienced advisors.

  • Consider raising finance

If you or your company are facing a state of financial difficulty, and feel that a cash injection to your business could help to tide you through the difficult period, finance may be an option. With the help of a specialist finance broker, such as ourselves, the avenues open to you can be explored and evaluated. To find out more about the services we can offer, please visit our dedicated website.

In summary

The Covid-19 outbreak has seen businesses across the world facing unprecedented times. Through emergency legislation (the coronavirus act 2020), the government has enacted protection for renters who have been left unable to pay some of, or any of their rent. This has caused anxiety amongst landlords, who fear that such a drop in income may lead to them facing financial difficulty.
If, as a landlord, you should find yourself facing financial difficulty due to a drop in income from rent payments, there are a number of options open to you. These include raising finance to tide your business through the difficult period, allowing a cash injection to cover the costs of maintenance, or other necessary expenses. Another option, if you find yourself or your company unable to meet repayments of outstanding debt, would be to arrange an affordable monthly repayment plan through means of an individual voluntary arrangement (IVA), or a company voluntary arrangement (CVA).

How we can help

If you are a landlord concerned about your financial situation due to a decline in income, we can help. We offer a free initial consultation with one of our experienced advisors, who will guide you through the options available in your individual situation. Whether the answer is sourcing a cash injection through our range of specialist financial services, or managing repayments of outstanding debt with a licensed insolvency practitioner, our advisors will guide you through the steps to take.

It is crucial to act quickly if you feel that the current climate is having a real effect on your finances, as doing so increases the likelihood of securing the best possible outcome. To take the first step, get in touch today.

Authored by Lisa Hogg

Lisa Hogg

Director & Licensed Insolvency Practitioner

Beverley Horton Christopher Callaghan Stephen Hall

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