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If a tenant (also known as a ‘contract holder’ in Wales) is struggling to pay rent due to unforeseeable difficult circumstances (eg a pandemic) they may ask for a rent holiday and for permission to delay rental payments. A Rent Repayment Plan creates a formal legal agreement for the repayment of deferred rent payments. Rent Repayment Plans help landlords avoid potential conflicts by setting out clear rules for the repayment of outstanding rent.
For use in England and Wales only.
Use this Rent Repayment Plan:
if you are a residential landlord
if you have been asked by your tenant to defer rental payments and you agree to this deferral
to set out the terms of the rent deferral and repayment
only for tenants in England or Wales
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Dear ,
Re: Deferral of rent payments
accept your proposal to defer your rent payments and re-pay this rent in instalments at a later date, as set out in this Letter.
This rent deferral shall apply from and shall apply for .
You shall make rental payments in the sum of £ each on . The first payment shall be made on and payments shall continue until the deferred rent is paid in full.
No interest shall be applicable on this amount.
The instalments are to be made into the following bank account: Account number , sort code and account name .
Please use your normal payment reference when making repayments.
sympathetic to your current situation and will work with you until you are back on your feet. Please note that this is not a rent holiday, but a deferral of your rent payments.
Please countersign below to confirm your agreement to this letter.
Yours sincerely,
The receipt of the letter dated is acknowledged and all of its terms are agreed to.
| Signed: | |
| Name: | |
| Dated: |
This Rent Repayment Plan template covers:
when the deferral period starts
the duration of the deferral period
the instalment amount
when instalments are to be paid
the details of the account into which the instalments should be paid
A Rent Repayment Plan will help you and your tenant come to an agreement regarding the deferral of rental payments. It will help avoid any potential conflicts by setting out clear rules for the repayment of the deferred rent by the tenant.
Consider making a Rent Repayment Plan to temporarily adjust rent payments and/or repayments of existing rent arrears. It is advisable to consider entering into a repayment agreement if a tenant with whom you have a good relationship is struggling to make their rent payments.
By making a Rent Repayment Plan you not only give your tenant a chance to get back on their feet, but also avoid the time commitments and costs associated with evicting the tenant and re-letting the property.
For more information, read Managing residential rent arrears.
Once signed by both the landlord and the tenant, a Rent Repayment Plan becomes a formal legal agreement. This means that for any breaches of the Plan (eg non-payment) legal action can be taken.
If a landlord and tenant agree on a Rent Repayment Plan to pay off arrears at a later date, it is important they both stick to this Plan, and that the tenant talks to their landlord immediately if they are unable to do so. Failure to pay rent may result in eviction.
As a landlord, you should consider sending a Rent demand letter and Final rent demand letter before issuing an Eviction notice to a tenant. For more information on evictions in England, read Repossessing property - section 8 notices and Repossessing property - section 21 notices. For evictions in Wales, read Repossessing property in Wales and Evictions in Wales FAQs. For help evicting a tenant, Ask a lawyer or use our Tenant eviction service.
Local authorities can provide support for tenants to stay in their homes. Tenants can see if they can access new funding from their local councils or if they and their landlord and can review the repayment terms and agree upon new terms.
Making a Rent Repayment Plan online is simple. Just answer a few questions and Rocket Lawyer will build your document for you. When you have all of the details prepared in advance, making your document is a quick and easy process.
To make your Rent Repayment Plan you will need the following information:
Tenant and property
What is the tenant’s name?
What is the address of the rented property?
Landlord
What are the landlord’s details (ie legal structure, name and address)?
If the landlord is a company, LLP or partnership who will sign the Rent Repayment Plan on behalf of the landlord’s business?
Deferral and repayment
On what date will the rent deferral period start?
How long will the rent be deferred for?
What are the repayment details (ie what are the repayment amounts, what is the date of the first instalment and how often will instalments need to be paid)?
If instalments are paid weekly, what is the payment day each week?
If instalments are paid monthly, what is the payment date each month?
What are the details of the bank account that payments should be made into?
Letter
On what date will the Rent Repayment Plan be sent to the tenant?
Rent Repayment Plans are used to accept tenants’ requests for rent deferrals and to record a deferral and subsequent repayment in a formal agreement. To achieve this, this Rent Repayment Plan covers:
Sender and recipient's details
The start of the Rent Repayment Plan provides details of the landlord and tenant and identifies that the document relates to the deferral of rent payments.
The deferral
The body of the Rent Repayment Plan sets out the details of the rent deferral. This includes:
the landlord accepting the tenant’s request for a rent deferral
details of the rent deferral period, including when it will start and how long it will last
how the rent will be repaid and when the first instalment needs to be paid
a clarification that interest will not be charged on the rent repayments
the details of the bank account the instalments should be paid into
The Rent Repayment Plan also confirms that, while the landlord is sympathetic to the tenant’s situation, the Rent Repayment Plan does not constitute a rent holiday but a rent postponement.
Signatures
The landlord should sign the Rent Repayment Plan in the space provided before sending it to the tenant. If the tenant agrees to the terms set out in the Rent Repayment Plan, they should countersign in the space provided. Once both parties have signed, the Rent Repayment Plan becomes a legally binding agreement.
If you want your Rent Repayment Plan to include further or more detailed provisions, you can edit your document. However, if you do this, you may want a lawyer to review or change the Rent Repayment Plan for you, to make sure it complies with all relevant laws and meets your specific needs. Ask a lawyer for assistance.
Agree to a reasonable repayment plan
If a tenant is struggling to make rent payments, it is important that you work with the tenant to find a repayment arrangement that works for both of you. Speak to your tenant and determine what deferral period and instalments will work for them. Consider offering more flexible repayment options, like spreading repayments out over a longer time period or reducing the amount of each repayment to make it more manageable for tenants.
Clearly communicate with your tenant
Rent Repayment Plans only work if all parties understand the terms and agree to them. Be transparent and clear in your communication with your tenant about their Rent Repayment Plan. Let them know what options are available and what the deferral and repayment terms will be. For more information, read Managing residential rent arrears.
Understand when you can evict a tenant
If your tenant continues to be unable to pay the rent, even after agreeing to a Rent Repayment Plan, you may have no choice but to evict them using an Eviction notice. The specific eviction notice you may need will depend on the specifics of your situation. Some types of eviction notices include:
a Section 21 (Form 6A) notice for England, used to evict a tenant for no fault of their own
a Section 173 notice for Wales, used to evict Welsh contract holders for no fault of their own
a Section 8 notice for England, if the tenant has not paid rent for a certain length of time
a Serious rent arrears eviction notice for Wales, if the tenant is in ‘serious’ rent arrears
For more information on eviction notices in England and Wales, read Repossessing property - section 8 notices, Repossessing property - section 21 notices and Repossessing property in Wales.
Any rent arrears owed by the tenant after an eviction will need to be recovered separately through the courts. For more information on this process, read Managing residential rent arrears.
Understand when to seek advice from a lawyer
Ask a lawyer for advice if:
the Rent Repayment Plan doesn't meet your needs or cover what you want
the tenant does not agree to the repayment terms
the tenant does not pay the rent repayments
your rental property is in Scotland
your commercial tenant has asked for a rent deferral
