Tenants Need Protection If Landlord Property Repossessed

Published / Last Updated on 25/08/2023

Generation Rent, a trade and lobby body for tenants, has issued an open letter to all lenders asking them not to evict tenants when a landlord has defaulted on their mortgage and the lender has repossessed it.

Renting property is hard enough as it is at present with rents rising as landlords struggle with higher mortgage interest payments as well as complying with new fire safety regulations as well as energy efficient performance improvements required from 2025.  Landlords and tenants are both under pressure and more landlord repossessions are taking place.

Both landlords and tenants have protection from each other with no-fault evictions banned but equally landlords have legal routes to evict troublesome tenants or non-rent payers. 

Sadly, tenants are not protected from eviction when properties are repossessed even though they may be up to date with rents and other bills etc.


We are appalled there is no industry standards for regulatory standards for repossessions and tenant protection.  Most buy to let lenders have significant protection already with usually 25% or more deposits, with plenty of ‘wiggle room’ for additional costs as well as usually needing rental cover of around 140% (i.e., the rent is usually at least 40% higher than interest payments on the mortgage debt).

The only loser here is the tenant, having the stress of finding a new home at short notice and likely end up paying more or even moving out of area if there is no local property available.  That said, lenders have a duty to minimise losses for themselves and therefore the landlord, so usually try to sell sooner rather than later to minimise their loss and return remaining capital to the former owner.

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