In the current economic climate everyone is feeling the pinch! With people all over the country being made redundant and the cost of bills going up, people are struggling more than ever to get by. In fact the housing charity Shelter recently announced that in the last year there has been a massive 50% rise in the amount of people paying their rent with credit cards as they just don’t have the physical cash or stable income.
With more and more people taking out personal loans, secured loans and credit cards to pay their bills and rent, there is the ever growing risk that soon many people won’t be able to pay their bills at all. This could be a devastating situation for any family but it could also be incredibly damaging for landlords.
The problem for landlords
The fact of the matter is, if your tenants can’t afford to pay their rent you may be left with a void in your income. Even if you can get the tenants out swiftly and new ones in this will rack up administrative costs and there will likely be a substantial gap during which rent is lost.
How to protect yourself
The obvious advice is to make sure before you rent out any property you ask for multiple references, a credit check and a rent guarantor from your prospective tenants. However, even with all this there is no guarantee that your tenants will not face hard times and be unable to pay the rent, especially in the current economic climate.
The other, more reliable way to protect yourself from this situation is to cover yourself with comprehensive landlord insurance or rent guarantee Insurance. Rather than running the risk of missing out on any rent, cover yourself with a good landlord insurance policy and in the event your tenants can’t pay the rent the costs will be covered.