Terminate contrct with highstreet letting agent

Hi all,

Urgently need some advice for my friend’s house.

The property has been managed by a highstreet letting agent for 3 years now, the current tenancy will end in July, the same tenants have been living in the property all the time.

My friend now would like to renew the tenancy with her tenants privately, since the highstreet letting agent really did not do much work in the past, there is no point to pay them ridiculous service charge every month any more.

When she informed the letting agent that she is not going to use them anymore once this tenancy ends, the agent starts to talk about one month rent charge to terminate the contract. The agent said because the tenants will stay, so the fee is applicable. I do not think it is reasonable as the landlord has paid the fees to find the tenants 3 years ago, and they have been receiving service charge every month for 3 years, now they want extra one month rent to ternimate the contract with the landlord.

Would like to hear your opinions.

Thank you!

Regards,
Jane

it is probably in the contract she signed, If so, she is getting off light compared to some agents, if not in the contract then argue it

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Whats reasonable is irrelevant. As said above, its whats in the contract that counts. I hope your friend does some landlord training before self managing or it could cost a lot more than the agents fees.

Yup, what they said. Read the contract. Reasonable doesn’t come into it - many agents have no exit provisions at all, so a month’s rent is probably a bargain!

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Thank you all.
We do not find any words in the contract regarding this charge.

And the agent was intending to charge one month rent for early contract termination in the first place, but we pointed it out that the tenancy will end in Jul, and we will only terminate the contract with the agent then, not now, hence no reason for early contract termination charge.

After that they start to talk about one month rent charge for tenants in situ. I feel that they are just trying to find an excuse to get more money.

My friend has rejected to pay for the charge, and waiting for the agent’s response.

Even if they give up the charge in the end, should we still report to Trading Standard or other about it? How do you think?

certainly sounds as if they are trying it on. Not in the contract then do not pay .Are they in an "agents association " ? report them

I saw the icons of “Property Ombudman letting” and “arla propertymark” in their website.

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The ending of a contract term with the tenant has no relevance to your contract with the agent, unless the tenant is moving out.

What does the agent’s contract say about termination? I would have thought there would be a clause in the contract that deals with it.

The last one an agent tried to get me to sign said that the contract could be terminated in writing but termination would only take effect on the tenant vacating the property and that the agent would be entitled to their fees as long as the tenant introduced by them remained in the property. ( I refused to sign that).

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Why use agents in the first instance they are only there to line their own pockets.
Just don’t pay it and inform them you are not paying it if its not in the contract, if it is just hope you have learned a lesson .READ THE CONTRACT.

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Ask the agent where in the contract it says you must pay the fee.

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Hi everyone,

It is confirmed that the charge was not in the contract when my friend signed in July2018.

We just got an email from the agent:
“On the 25/03/2019 an email was sent to you from our Operations Team advising of our new up to date Terms of Business which came into effect on the 20/12/2019, you had a cooling down period to advise that you did not want to accept the new Terms of Business, but we had no correspondence from you regarding this and you are now bound by it.”

How ridiculous!!

The contract was signed in July 2018 with no any wording about the charge, but they changed their Terms of Business afterwards.

What should we reply to them? Any suggestions?

Thanks.

Please see my update. We need your suggestion, thanks in advance.

One months rent is typical in this scenario, however the new terms and conditions are meaningless and utter BS! Don’t pay agent and create and new AST contract with tenant. Let them sue you, any judge will throw that nonsense out about new terms and conditions. It’s the contract that matters. A random email with terms needs agreeing to to be a valid “contract”, to say you didn’t object does not amount to acceptance, you would have needed to reply to it.

What if you didn’t receive the notice of new terms and conditions?

You need legal advice about whether you are bound by their new terms.

Read the contract the information you are looking for will be in there.
It is advisable to read a contract in full and digest it before you sign it

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Its true that if you have long term tenancies then agents seem less cost-effective but remember they found that Tennant in the first place. Now I did have a local estate agent “fully managed” one of my houses and they were totally useless. For them fully managed meant take a call about a problem, not doing anything, then after hassling call me and ask me what to do about it. My responce was fully manage it and give me qoutes to fix it… months pass and then you fix it yourself. Then the Tennant starts calling you directly as the agent was so bad. The last straw was when they tried to charge me twice for work carried out months before.

ANYWAY I paid the month’s severance and that was 5 years ago. Iv more than made my money back. If the Tennant stays there for every a year then you will gain profit from this decision but if somthing goes wrong then you have to pick up the phone and find some one that can fix it…

If you have a problem with the agent also consider complaining.

I have just been through the same issue. The contract stated that fees will always be payable to the agent while the tenant is still living there, even if I chose not to use the agency any longer. Sadly, it is legally binding. I have now managed to get out of it and here is part of the text of the email I sent them:

"From a number of sources, including the National Residential Landlords Association, I gather that the issue of the rather unethical, even parasitic, terms whereby a landlord must pay fees to an agency for the entire time the original tenant is resident at the property but with no end time and no clause for termination of those terms is, whilst legal, “frowned upon” by the law. I do not consider this never-ending clause to be fair as it is giving rise to a “significant imbalance” under the Unfair Terms in Consumer Contracts Regulations 1999. The answer seems to be that we must come to an “amicable agreement” on the matter and it is regarding this that I am writing to you now."

Note, the 1999 regulations were superceded in 2015 so you may need to go onto the government web site to check the wording. My contract started before then so I used the 1999 version.

Best of luck.

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Its worth googling the “Foxtons case” to see if its relevant.

Maybe just consider the other side of the coin.
Did you ask the agent to find you a tenant? You probably said you wanted someone long term who would pay the rent.
Did you agree to pay a proportion of the rent paid to the agent for finding the tenant?
Why grumble if the agent has done exactly as contracted to do?
If the tenancy lasted a couple of months the agent would be out of pocket. If the tenancy lasts longer the agent is quids in. It’s a balance between the two.
You should be delighted that the agent found you a long term tenant who is paying the rent without a problem.

Gregory: agent is saying they randomly emailed new terms and conditions which were contrary to original agreement. And by not disagreeing to them means LL agreed to them. Complete nonsense.

EA normally charge around a months rent finding fee, not a cut of the rent indefinitely. The cut is for management.

If using EA for a finding only service then a one off fee applies, again around a months rent.

What’s reasonable doesn’t come into it. Is it reasonable an estate agent completely screws down supplier (plumber etc) rates and then significantly marks this up when invoicing the LL? Bare in mind an EA is already getting a slice of rent for managing. “What can I get away with” is the EA motto.

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