First months rent not paid... options

The contract starts tomorrow and the tenants have not paid the rent or deposit despite numerous requests to do so. We would like to cancel the contract. Is that possible?

I’m sure you can. Do not give them the keys and speak to Open Rent.

did you sign contract? if not then there is no tenancy until the rent is paid. This is why I always take the biggest holding deposit, so they cannot weasle out of the contract at the last minute!

I am aware I am replying somewhat after the event.
Firstly, hope they ended up paying OR that, if not, you did not give them keys in advance (and why would you?)

In what will probably end up a failed but well-intentioned attempt to save rambling, I will bullet point with general advice also to other readers:

  1. Always professionally reference all tenants 18 yrs plus and cite each on rental agreement unless there are special circumstances not to do so, by example, their child, aged 19 but who is mentally incapacitated and therefore not answerable in law to a rental default or other clause contravention. It may still be best to mention them as an adult tenant, nevertheless, so take advice, that is current at the time, where you perceive extraordinary circumstances.

  2. Wherever possible, issue their copy of contract (most typically an AST or ‘Assured Shorthold Tenancy’) in advance of the day all parties will sign. This should be mentioned within the AST itself because a court may ultimately read it. Your ‘reasonableness’ should always be fully documented, not least, the would-be tenants sign the statement’s authenticity. My own AST also states a 24 hour cooling-off period from… ‘time of last signature and for all parties…’ which further shows a landlord as being reasonable but also facilitates exceptional cases where you have agreed to a same-day signing.

  3. Take a holding fee, pending referencing enquiries with a receipt/terms which clearly indicates circumstances in which they would/would not receive a refund.
    In short, if the references are ultimately deemed… ‘unsatisfactory to the landlord,’ they will be refunded promptly and in full.
    If they change their mind about renting the property on the pre-agreed, stated tenancy start date - signed as agreed by all parties on the holding fee receipt/terms doc., they lose it. Of course… you have discretion. If they ask for a delay of a few days, get the new date signed by all as a final date… but be reasonable. If you want shot of them, refuse the request for a change of terms and refund them in full.
    The whole point of taking a ‘holding fee’ -best not to refer to it as a holding deposit- is to allow the property to be reserved pending referencing enquiries. Ensure this is date-specific since some or all applicants may fail to give the required info to the refs. agency in a timely manner. Ensure also that the holding fee receipt/terms doc has an agreed tenancy start date.

  4. It is prudent not to put any signatures to the AST until you have taken funds which equals the deposit I.e. holding fee plus outstanding amount to total value of the deposit (AST should be signed simultaneously and in the presence of all other parties). This should be only once refs/deposit/first rental requirement are credited to your account which, these days can be done via ‘faster payment scheme,’ there and then.
    Do NOT take any monies beyond the holding fee if you are not yet happy to proceed.

  5. Once you have refs that YOU are happy to proceed with - and you may ultimately decide to change the terms e.g. 6 months required in advance- that is the time to take the first months rent, simultaneous with all signatured being taken on both your and their AST copies. Keys should NOT be issued until the day the tenancy starts, not least for insurance and liability reasons.
    This also allows for a proper ‘check-in’ and exchange of keys, at the property, including signed as mutually agreed utilities readings, inventory and property condition report or ‘schedule of condition.’

Have done all this on a smart-phone; not the best idea when trying to be precise, accurate and helpful and without typos or grammatical faux pas. Apologies for any errors.

Finally, I would always advise readers to take professional, current advice such as that available from National Landords Association. (I am a professional landlord but not a professional adviser.)


Peter B
Member NLA (accred)


Money first then sign