jdm Residential Letting Service
& Terms of Business
jdm are locally based independent estate agents covering much of the Bromley Borough and surrounding areas, providing a full range of residential property services, to the highest professional standards. Our success depends on our reputation.
jdm Lettings operates independently of the estate agency business, dedicated solely to letting and committed to providing you with a personal and professional service. Our experienced staff will be pleased to give you all the advice and assistance required for hassle free letting of your property.
Initially, we can meet you at your property, without charge or obligation, to assess the appropriate rental level at which to offer the property, to advise you of any enhancements to the property which would be of benefit, and discuss your requirements and arrangements which need to be made prior to letting. Alternatively, if you are considering the purchase of a property to let, we would be pleased to give guidance on the most suitable properties and locations for letting and advice on the suitability of particular properties and enhancements to consider.
As a bonded member of the Association of Residential Letting Agents, our professional body, and the National Approved Letting Scheme, a government backed body, you can be assured that we maintain the highest professional standards, operating a fully protected and audited client bank account, and that our qualified staff are kept fully up to date with changing legislation with regular training.
SERVICES TO LANDLORDS
We offer two principal service to landlords; Letting & Rent Collection Service, and Letting, Rent Collection & Management Service.
Where you will remain in residence locally, and are able to deal swiftly with repairs and maintenance problems that should arise, our Letting & Rent Collection Service may suit you.
If you remain local, but would prefer to leave it to the professionals to look after your interests, or if you will be resident abroad, or away from the local area, to ensure that you are able to meet your legal responsibilities to the tenant, you will want to take advantage of our Letting, Rent Collection & Management Service.
Alternatively, for those confident they can deal with rent collection issues as well as repair and maintenance, we can offer a simple Letting Service, providing our full marketing package and referencing of prospective tenants, arrangement of inventory checks, and secure holding of tenant deposits for the duration of the tenancy. It will be the landlord’s responsibility to collect rent and deal swiftly with repairs and maintenance problems.
Marketing & Letting
In all cases we will market your property through extensive local advertising and Internet service and, where appropriate, our corporate contacts. We also recommend a “To Let” board be placed outside the property, as they regularly prove an invaluable aid to swift letting. We will arrange for viewing by prospective tenants either with you or accompanied by
our staff, as necessary. Offers received from prospective tenants will be put to you, together with their details, for your approval, following which we will obtain references. Only when satisfactory references have been received will we proceed to contract.
The tenancy will normally be documented for an initial six or twelve month term, often with a termination facility in favour of either the tenant or both parties subject to agreement. We will liaise between the parties to negotiate a subsequent renewal of tenancy if required, subject to a rental increase where appropriate, or serve legal Notice on your behalf where vacant possession is required.
We provide our own standard form of tenancy agreement covering all legal requirements, fully safeguarding both landlords’ and tenants’ rights, with additions and amendments appropriate to particular circumstances or to reflect arrangements agreed. As your agent, we would sign the tenancy agreement on your behalf. We will retain the Tenancy Agreement on file for safe-keeping, though you will be welcome to a copy if required.
Tenants will be responsible for utility bills during the course of their tenancy. Where applicable, we will notify utility providers of meter readings on commencement and termination of tenancy, though due to Data Protection and other legislation, landlords and tenants need to contact the utility companies themselves regarding the change of consumer.
Deposit & Dispute Settlement
To protect the interests of both landlords and tenants, we hold a tenant’s security deposit as stakeholder. The deposit is safeguarded in our client bank account. As stakeholder we are entitled to retain any interest accrued on deposits. Legislation prevents landlords and agents from holding tenant’s deposits unless they are members of the Tenancy Deposit Scheme, sponsored by ARLA, NAEA & RICS, or Tenancy Deposit Solutions scheme, sponsored by the National Landlords Association. Otherwise, the deposit must be paid to a government custodial scheme. There are severe penalties for landlords who fail to comply with this legislation.
We, as long standing members of the Tenancy Deposit Scheme, are able to hold deposits, rather than pay them into a government custodial scheme, where the agent and the landlord lose control of the deposit.
Under the scheme we must endeavour to refund deposits, less agreed deductions, within 10 days. Normally, following receipt of an Inventory Check-Out report, we will be able to make a settlement within this time, making reasonable deductions for damage or deterioration beyond wear and tear subject to agreement by both parties. However, if there is a dispute over how the deposit should be allocated which we cannot settle, it will be referred to the Independent Case Examiner. He will adjudicate within 10 working days of receiving all the necessary papers.
The costs are modest, so we are able to charge you only £3.53 on commencement of each new tenancy toward our membership fees. There are no additional charges for the adjudication.
Further details of the TDS can be found at page 7, or you can go to http://www.tds.gb.com/. Information on the Tenancy Deposit Solutions scheme can be found at http://www.mydeposits.co.uk/, whilst information on the custodial scheme can be found at http://www.depositprotection.com/
Inventory
Whilst most tenants will look after your property, in order to avoid dispute and to support your claim in the event of adjudication, we strongly recommend the professional preparation of an inventory to fully document the contents and condition of the property and that this is checked on commencement and termination of each tenancy. This will include the state of cleanliness of the property, condition of carpets, curtains, decorations and, where applicable the garden. Utility meter readings also need to be taken. We can arrange for these procedures to be undertaken by an independent inventory clerk.
The property should, of course, be clean on commencement of tenancy, including carpets and curtains. Consideration should be given to professional cleaning prior to commencement of tenancy, at your expense, and you should be prepared to have cleaning carried out between tenancies, subject to a contribution toward the cost from the outgoing tenant where applicable, at the recommendation of the inventory clerk.
Repairing Obligations
You have two principle forms of repairing obligation to your tenants. The first is a statutory requirement to keep in good repair the structure and exterior of the property, all water, gas, electricity and sanitation services and heating installations. The second is a more general contractual obligation to keep the property and contents in working order, subject to the tenant’s duty of care.
DETAILS OF SERVICES
Letting & Rent Collection Service
Where we are acting as your letting & rent collecting agent, we will settle any expenses incurred in connection with commencement of tenancy and our fees will be collected monthly throughout the term of the tenancy from rent received. We will arrange for the tenant to set up a monthly standing order payable to ourselves and will account to you as soon as funds are cleared into our account. We will pursue any arrears as soon as they arise.
We will liaise between you and your tenant to negotiate terms for renewal of tenancy and document the agreed renewal accordingly, or make arrangements for termination of tenancy as required. It is important to remember that termination of tenancy by the landlord is usually subject to the service of statutory notice no less than two months before the end of a fixed term.
Letting, Rent Collection & Management Service
In addition to the letting & rent collection service, we will remain the contact point for the tenants should they experience any problems with the property. We will arrange for any repairs and maintenance to be carried out, usually using either our regular team of cost effective and reliable contractors, or where appropriate your own nominated contractors. Repairs required to fulfil your legal obligations to the tenants will normally be undertaken as quickly as possible, though we will endeavour to contact you if the cost of repair is likely to exceed £150. For non-urgent repairs or maintenance, we will always seek your approval before proceeding. We will also arrange for payment of closing utility accounts that we receive.
We undertake quarterly maintenance visits both to check the tenants are looking after the property in an appropriate manner and to establish if any maintenance or repair works need to be undertaken. We will report any problems to you.
In both cases, termination of your contract with us is subject to a minimum two months notice, to expire on vacation of the property by the tenant.
Letting Service
Where we are providing only our Letting service, we will write to the landlord three months before the end of each tenancy to establish if the property remains available for letting, and other than where this will be within twelve months from commencement of tenancy, to establish if the landlord wishes us to negotiate renewal terms and document a new tenancy. We will also serve termination notices where required for a small additional charge.
Rent Guarantee & Legal Expense Warranty
We can arrange, on request, Rent Guarantee & Legal Expense Warranty against loss of rent and legal expenses up to £15,000, at a premium of £45.00+VAT per six month term, or £80.00+VAT per twelve month term. Whilst rarely required, this cover will give you that extra piece of mind and is, of course, of real benefit when things do go wrong. Further details are attached.
Fees & Expenses
Commission charged for our Letting and Rent Collection Services is 10% (+VAT) of rental for the first 12 months of any tenancy, reducing to 5% of rental for any subsquent period of the same tenancy, payable monthly from rent collected.
Commission charged for our Letting, Rent Collection & Management is 15% (+VAT) of the gross rental income for the duration of any tenancy, collected monthly on receipt of rent, throughout the term of the letting.
Our fee to the landlord choosing either of the above services for preparation of each tenancy agreement, both on commencement and renewal of tenancy, is £60 including VAT.
Commission charged for our Letting service is 10% (+VAT) of the gross rental income for the first twelve months of each tenancy, payable on commencement of tenancy. Whilst the majority of tenancies are for twelve months or more, in the event that a tenancy terminates earlier than twelve months from commencement, we undertake to re-credit commission on a pro-rata basis, either against our next letting commission, or as a refund to the landlord in the event that we do not proceed to re-let the property.
Should landlords choosing our Letting service wish us to negotiate and document a renewal of tenancy after the first twelve months, we charge £180 including VAT. Where the landlord wishes to terminate a tenancy, we will serve the relevant termination notice subject to a charge of £40 including VAT.
Inventory charges are based on the size of the property and extent of furnishing, but will start from £60 and rise according to size of property and content. Similarly, charges for checking the inventory with the tenant at commencement will start from £50. Both the making and checking of the inventory at commencement are chargeable to the landlord. We would be able to provide a more accurate costing once we have seen the property. The outgoing tenant is normally charged for the inventory check on their departure, thereby splitting fairly the overall cost of the independent assessment between the two parties.
Charges for Gas & Electrical Safety Tests should also be expected of between £60 and £80, dependent on the number of appliances tested.
Selling Fee
Should a tenant we introduce to you proceed to purchase the property from you at any time during, on termination, or within six months of termination of the initial or any subsequent tenancy, we will charge a selling fee of 0.75% (+VAT) of the total sale price.
BEFORE YOU LET
There are a number of issues to be dealt with before you let and on which we can advise or assist.
Furnishings
Should you let furnished or unfurnished? There is a considerably stronger market for unfurnished property, usually retaining carpets, curtains/blinds and major kitchen appliances, whilst only a limited demand for fully furnished property. Our advice must therefore be to recommend offering your property unfurnished or, if you would prefer to let your property furnished, be prepared to remove/store furnishings. For that reason there is only limited availability of furnished accommodation, so if you really need to let furnished, you can, though we will be working in a niche market.
As you might expect, it is generally the case that a well presented property (with a reasonable level of modern furniture and equipment) will let more readily than a property which looks tired, or where furniture is in poor condition or is dated. It is therefore worth improving the condition and appearance of the property, and disposing of dated furnishings wherever possible, particularly where letting an investment property. Televisions, audio equipment, coffee makers, mixers and the like need not usually be provided. If they are, any repair charges will fall to the landlord.
A good shower facility is certainly favoured by the majority of tenants. You should consider such an installation, if not already provided, and to avoid associated condensation problems in the bathroom, you should also consider the installation of an extractor fan.
In any event, it is essential to comply with fire safety regulations, as noted below. We would be pleased to advise you on this issue.
Fire Safety
The law requires that where letting a property, soft furnishings must comply with fire safety regulations. These apply to beds, sofa suites and other upholstered furniture, but not carpets and curtains. Essentially, furniture manufactured since 1989 must comply with the regulations. They will have a notice attached confirming compliance (with BS7177 in the case of beds), unless these have been removed. Furniture manufactured before 1950 is exempt, whilst furniture manufactured between 1950 and 1988 should be assumed not to comply and should be removed prior to letting.
Smoke detectors are not legally required, but are to be recommended.
Gas & Electrical Safety
The law requires that where letting a property with any gas installation, a Landlord’s Gas Safety Check MUST be carried out by a Corgi registered engineer prior to commencement of tenancy and annually thereafter and that any defects are rectified. A record of that check must also be made available to the tenant. This we can arrange on your behalf prior to commencement of the first tenancy. We will also arrange subsequent annual checks for management clients and send out a reminder to other clients in good time for them to make the necessary arrangements. Carbon monoxide detectors are not a legal requirement, but are to be recommended.
The law also requires that where a property is let, all electrical installations and appliances are in a safe condition. Whilst there is not yet any statutory requirement for regular electrical safety tests, in order to ensure compliance with the law, we must recommend that an electrical safety test is carried out prior to commencement of tenancy, any defects rectified and a report supplied.
Tax
When letting a property it is your legal obligation to declare your rental income to the Inland Revenue, by way of an annual self assessment tax return. The majority of expenses incurred in connection with letting the property can be offset against tax. When resident abroad, you may also be able to offset your personal allowances against rental income.
If you are going abroad, we as your rent collecting agent are obliged to deduct from rental income basic rate tax and pay this to the Inland Revenue quarterly. To avoid the need to do so, enabling you to pay only your true liability after allowances once calculated at the end of each tax year, you simply need to complete and forward to the Inland Revenue their form NRL1, copies of which we can provide, or be downloaded from http://www.hmrc.gov.uk/cnr/nrl1.pdf. They will notify us that we may pay you without deduction. Please note that each joint owner of a property going abroad will need to apply individually.
If a landlord abroad did not use a UK agent to collect rent, the tenant would have to assume the responsibility to deduct tax from the rent and pay the Inland Revenue, unless they receive notification from the Inland Revenue that they may pay rent without deduction of tax.
Mortgage, Insurance & Freeholder/Block Management Authority to Let
You will need to notify your mortgage lender, building and contents insurers and, where applicable, your freeholder or block managing agent that you will be letting the property and seek their agreement to do so.
You may find that mortgage or insurance rates are increased, or that the level of insurance cover is restricted. We offer specialist mortgage and insurance products at competitive rates and would be pleased to obtain quotes for you.
If there are any conditions of your lease or restrictive covenants to which your tenants will need to adhere, please let us have these in writing.
You should also ensure that your freeholder or managing agent knows where to send service charge invoice, and ideally arrange for payment by direct debit.
OTHER SERVICES
Should you wish to purchase a property to let, we can source a suitable property on your behalf, impartially through either our sales colleagues at jdm or other agents, to secure you the best prospect of regular and reliable letting. We can also arrange refurbishment and furnishing as required.
Our fee for the purchasing service is 1% (+VAT) of the purchase price and refurbishment and furnishing arrangement is charged at 10% of the cost of works and purchases.
jdm can also arrange a mortgage with one of the many lenders now offering specialist products for property investors, together with all insurance required.
Please call us to discuss further details.
TENANCY DEPOSIT SCHEME – ALTERNATIVE DISPUTE RESOLUTION FOR DEPOSIT DISPUTES
jdm Lettings Ltd is a member of the Tenancy Deposit Scheme,which is administered by:
The Dispute Service Ltd
PO Box 541
Amersham
Bucks
HP6 6ZR
Tel: 0845 226 7837
e-mail: deposits@tds.gb.com
Fax: 01494 431 123
The terms of the scheme are as follows:-
If we are instructed by you to hold the Deposit, we shall do so under the terms of the Tenancy Deposit Scheme.
The Agent holds tenancy deposits as Stakeholder (if not already specified within the Tenancy Agreement).
2. At the End of the Tenancy Covered by The Tenancy Deposit Scheme
If there is no dispute we will keep any amounts agreed as deductions where expenditure has been incurred on behalf of the Landlord, or repay the whole or the balance of the Deposit according to the conditions of the Tenancy Agreement with the Landlord and the Tenant. Payment of the Deposit will be made within 10 days of written consent from both parties.
If, after 10 working days following notification of a dispute to the agent and reasonable attempts have been made in that time to resolve any differences of opinion, there remains an unresolved dispute between the Landlord and the Tenant over the allocation of the Deposit, it will (subject to 2c below) be submitted to the ICE for adjudication. All parties agree to co-operate with any adjudication.
When the amount in dispute is over £5,000, the Landlord and the Tenant will agree by signing the Tenancy Agreement to submit the dispute to formal arbitration through the engagement of an arbitrator appointed by the ICE although, with the written consent of parties, the ICE may at his discretion accept the dispute for adjudication. The appointment of an arbitrator will incur an administration fee, to be fixed by the Board of The Dispute Service Ltd from time to time, shared equally between the Landlord and the Tenant. The liability for any subsequent costs will be dependent upon the award made by the arbitrator.
The statutory rights of either you or the Tenant to take legal action against the other party remain unaffected.
It is not compulsory for the parties to refer the dispute to the ICE for adjudication. The parties may, if either party chooses to do so, seek the decision of the Court. However, this process may take longer and may incur further costs. Judges may, because it is a condition of the Tenancy Agreement signed by both parties, refer the dispute back to the ICE for adjudication. If the parties do agree that the dispute should be resolved by the ICE, they must accept the decision of the ICE as final and binding.
If there is a dispute, we must remit to The Dispute Service Ltd the full deposit, less any amounts already agreed by the parties and paid over to them. This must be done within 10 working days of being told that a dispute has been registered whether or not you or we want to contest it. Failure to do so will not delay the adjudication, but The dispute Service Ltd will take appropriate action to recover the deposit and discipline us.
We must co-operate with the ICE in the adjudication of the dispute and follow any recommendations concerning the method of the resolution of the dispute.
3. Incorrect Information
If the Landlord warrants that all the information he has provided to the Agent is correct to the best of his knowledge and belief. In the event that the Landlord provides incorrect information to the Agent which causes the Agent to suffer loss or causes legal proceedings to be taken, the Landlord agrees to reimburse and compensate the Agent for all losses suffered.
4. If you decide to hold the Deposit and the Tenancy is an Assured Shorthold Tenancy, you must specify to us prior to the start of the Tenancy under which other Tenancy Deposit Protection Scheme the Deposit will be covered. If the Deposit is covered by Tenancy Deposit Solutions, you must provide proof of membership, together with a copy of the insurance policy before the Deposit can be released. If the Deposit is to be sent to the custodial scheme known as the Deposit Protection Scheme, we will forward the Deposit to the DPS and register the details of the Tenancy on your behalf OR give you a cheque for the amount of the Deposit made payable to the Deposit Protection Scheme for you to forward within nine days.
FCC PARAGON RENT PROTECTION & LEGAL EXPENSES WARRANTY
We offer to arrange cover on your behalf, on request, for loss of rent and legal expenses. This is provided by the company who undertake our tenant referencing, and is subject to obtaining satisfactory references. The terms of warranty are as follows:
Eligibility
The landlord, or managing agent acting on their behalf, must ensure that the following procedures are adhered to. They must:
a) not allow a tenant into possession of the property other than on the basis of an already completed written tenancy agreement duly signed by all parties;
b) be based on one of the following: an assured shorthold tenancy, a short assured tenancy; or an assured tenancy. These are all defined by the housing Act 1988 or the Housing (Scotland) Act 1988.
c) not allow any tenant into occupation until the first month’s rent and dilapidation deposit payment has been paid in cash or payment has been cleared in the landlord’s or managing agent’s bank account;
d) ensure all tenants are fully referenced and successfully pass the referencing procedure.
Exclusions
Benefit will not be paid in respect of any claim:
a) if the commencement date of the Rent Protection and Legal Expenses Warranty contract is after the tenancy start date, if so the first 90 days of the contract will not protect against any events occurring within this time;
b) where the landlord or managing agent acting on their behalf fails to provide evidence or information reasonably required by FCC Paragon;
c) which is notified to FCC Paragon more than 31 days after non-payment of rent;
d) where the amount in dispute is less than £250.00;
e) the first month’s unpaid rent;
Rent Protection Warranty Cover
Monthly rent will be paid in respect of arrears of rent owed on the Landlords property covered by FCC Paragon’s Rent Protection and Legal Expenses Warranty contract for up to 6/12 months or until vacant possession has been gained, whichever happens soonest.
A 6/12 month policy shall pay out for no more than a maximum of 5 months rent arrears in any one claim.
Legal expenses authorised/incurred by FCC Paragon, including court costs, to obtain vacant possession after non-payment of rent are included in the benefits provided by FCC Paragon Rent Protection & Legal Expenses Warranty.
In the case of Rent Protection and Legal Expenses Warranty amounts payable will not exceed £15,000 which is the maximum cover under this contact.
Alteration of Contract
The landlord or managing agent acting on their behalf shall notify FCC Paragon as soon as they become aware of any alteration in risk which may affect the Rent Protection and Legal Expenses Warranty contract. The landlord or managing agent acting on their behalf may be required to pay an additional premium to FCC Paragon.
Claims Procedure
If the rent is overdue the tenant and guarantor must be contacted within 7 days to find out why it has not been paid. If rent remains overdue, within 14 days the tenant and guarantor must be contacted again (If applicable at the place of work).
Where the landlord or managing agent acting on their behalf becomes aware of an existing or potential claim under any parts of the Rent Protection and Legal Expenses Warranty contract the landlord or managing agent acting on their behalf shall notify FCC Paragon promptly and forward a fully completed claim form which is to be received no more than 31 days after the rent was due.
General Conditions
a) FCC Paragon will negotiate any claim for the landlord or managing acting on their behalf.
b) FCC Paragon will appoint an appointed lawyer.
c) The appointed lawyer will be secured by FCC Paragon and represent the landlord or managing agent acting on their behalf according to our standard terms of appointment.
d) FCC Paragon will have direct contact with the appointed lawyer.
e) The landlord or managing agent acting on their behalf must co-operate fully with FCC Paragon and with the appointed lawyer.
f) The landlord or managing agent acting on their behalf must give the appointed lawyer any instructions that FCC Paragon ask for.
g) The landlord or managing agent acting on their behalf must tell us if anyone offers to settle a claim.
h) If the landlord or managing agent acting on their behalf do not accept a reasonable offer to settle a claim, FCC Paragon may refuse to pay further legal costs.
i) The landlord or managing agent acting on their behalf must not negotiate or agree to settle a claim without approval from FCC Paragon.
j) If FCC Paragon require, the landlord or managing agent acting on their behalf must tell the appointed lawyer to have legal costs taxed, assessed or audited.
k) The landlord or managing agent acting on their behalf must take every step to recover legal costs that FCC Paragon have to pay and must pay FCC Paragon any legal costs that are recovered.
l) If the appointed lawyer refuses to continue acting for the landlord or managing agent or if the landlord or managing agent acting on their behalf dismiss the appointed lawyer, the FCC Paragon Warranty will end at once, unless FCC Paragon agree to appoint another appointed lawyer.
m) Warranted benefits will be withheld if the landlord or managing agent acting on their behalf acts without the consent or contrary to the advice of FCC Paragon.
n) If benefits are paid out in respect of rent arrears and subsequent payments are received from the tenant, these payments must be forwarded to FCC Paragon without fail.
o) At any time during a rent arrears claim FCC Paragon may request proof that the property is still occupied and vacant possession has not been gained.
p) If you have not received a contract schedule or paid in full within the terms and conditions, the warranty will not be in force. If you do not receive confirmation of cover within 10 days of inception/renewal you must contact us immediately.
Cancellation
The landlord or Managing Agent acting on their behalf, may cancel the warranty at any time by giving 14 days notice in writing. FCC Paragon may cancel the warranty contract at any time giving notice in writing to the Landlord or Managing Agent.
Termination
The contract will terminate on the earliest of the following events;
a) The end of the term
b) The landlord or managing agent acting on their behalf fails to pay the relevant premium when due
Notifications of a claim will not be accepted if the date of non-payment of rent is after the termination of the Rent Protection and Legal Expenses Warranty contract.
If the landlord or managing agent acting on their behalf does not keep to the terms of the Rent Protection and Legal Expenses Warranty contract they will not be entitled to any benefit.
Terms of Cover
For cover to continue under the Rent Protection and Legal Expenses Warranty contract the landlord or managing agent acting on their behalf must keep up to date clear rental records.
The Rent Protection and Legal Expenses Warranty contract will be withheld if the landlord or managing agent acting on their behalf acts without consent or contrary to the advice of FCC Paragon.
The Rent Protection and Legal Expenses Warranty contract will not provide cover for any pre-existing events, which would give rise to a claim.
For the avoidance of doubt, FCC Paragon’s 6/12 month Rent Protection and Legal Expenses Warranty contract is in support of the quality of FCC Paragon Referencing – they are not contracts of insurance and any benefits provided are at the sole discretion of FCC Paragon.
All benefits from the Rent Protection and Legal Expenses Warranty contract will cease once vacant possession has been obtained.
Complaints
It is always our intention to provide a first class standard of service however, if you do have cause for complaint, you should contact FCC Paragon in writing;
Janie Gaston
General Manager
FCC Paragon
4/5 The Briars
Waterberry Drive
Waterlooville
Hampshire, PO7 7YH
If the matter is not resolved to your satisfaction, please write to;
The Financial Ombudsman Service
South Quay Plaza
183 Marsh Wall
London, E14 9SR
Confirmation of Instruction
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