Q&A on using the tenancy/lodger agreements.
Q. Which agreement should I use?
A. If you are renting out a room in your own home, you should use the lodger agreement. If you are renting out a room in a shared house which you do not live in (where everyone in the house has their own agreement for their own room and shared use of the rest of the property), you should use the AST agreement.
NB If you are renting a whole house or flat to a number of sharers who will all sign the same tenancy agreement, then neither of these agreements should be used, and you should use an ordinary AST agreement. You will find many of these in the shops, or online, for example at www.landlordlaw.co.uk.
Q. What is the difference between the two agreements
A. The AST is where someone has an assured shorthold tenancy of their own room. This means that you as the landlord are bound by all the landlords obligations such as the statutory repairing covenants, the need to register any deposit with one of the government authorised tenancy deposit schemes, and you cannot evict the tenant unless you serve the proper notice and then obtain a court order for possession.
On the other hand the lodger agreement is not an AST. It is what lawyers call a ‘license agreement’. The reason for this is that you, the landlord, are letting out a room in your own home, and the lodger does not have ‘exclusive occupation’. Much of the legislation which applies to ASTs will therefore not apply to this agreement. For example you do not have to protect the deposit (if you take one) in a scheme, and, provided you share some living accommodation with the lodger, you will not have to get a court order for possession.
Q. Can I use the lodger agreement if I do not share any living accommodation with the occupier?
A. The significance of sharing living accommodation with the occupier is that he does not acquire a tenancy, and all the legal rights and obligations which go with tenancies. Living accommodation means things like kitchens, bathrooms, and living rooms. Corridors and halls do not count.
If you live in the same building but do not share any living accommodation, it is really important that you provide at least one service (preferably cleaning and/or providing clean sheets where you will go into the room regularly), as this will prevent the occupier from acquiring a tenancy. However even if the agreement is not a tenancy (for example because you provide breakfast and regular cleaning), if you do not share any living accommodation you will need to get a court order, if the occupier refuses to leave.
You can use the lodger agreement for both these situations.
Note however that if the occupier has a completely self contained room, and does not share any living accommodation with you, and you do not provide any services, this will automatically be a tenancy. Getting the occupier to sign the lodger agreement will not change this. The tenancy will be a ‘common law’ tenancy with a resident landlord. We do not have any suitable agreements on this site, but you can obtain one from www.landlordlaw.co.uk.
Q. Should the occupiers room have a lock on the door?
A. If you do not live in the property and are using the AST agreement, yes there should be a lock on the door.
However if you are using the lodger agreement to rent out a room in your own home, it should not have a lock (or if it does, you must have a key). This is because you need to retain control over the room, and be able to enter it if need be to do any maintenance, cleaning or anything else that is needed (e.g. changing light bulbs, cleaning windows etc). This is important (1) because it is your home and you need to be able to carry out any maintenance work in the room when needed, and (2) because it will prevent the occupation from turning into a tenancy.
Q. Can I incorporate some ‘house rules’ into the agreement?
A. These agreements are drafted to as to be suitable for many different landlords and properties. If you have some particular arrangements at your property, it is often a good idea to include these in separate ‘house rules’. For example, arrangements for the use of the bathroom, shared cleaning responsibilities (if cleaning is not provided), use of the land line telephone, etc.
You should discuss these with your lodger or tenant first, and then write them on a separate sheet, headed ‘House Rules’ giving the address of the property. Then on the agreements, write at the bottom of the first page ‘See also the attached house rules’. Both you and the lodger/tenant should initial and date this wording.
Have two copies (one for you and one for the lodger/tenant). You should both sign and date them at the same time as the lodger or tenancy agreement is signed. The House Rules should then be attached to the agreement and kept with it.
Filling in the forms
Do any reference checking before you let the occupier into occupation, and also ensure that all cheques have cleared. In general when filling in the forms you should be careful and not allow yourself to be rushed, as it is a legal document . Write clearly and make sure that all spellings are correct.
You will need two copies, one for you and one for the tenant or lodger. If you are attaching anything (such as an inventory), make sure you have two copies of this also, one for each agreement.
When signing the agreements, they do not have to be witnessed (although it is always a good idea) unless you are using the AST and it is being signed up before the tenant moves in. A witness should be someone independent. For example you cannot witness the tenants signature yourself.
When the forms have been signed, you need to have one signed by the occupier and the occupier needs to have one signed by you. But there is no reason why you should not both sign both of them.
The License/Lodger form.
This is for when you let out a room in your own home.
Date: Date the agreement after it has been signed, ideally on the day the lodger moves in.
Property: This is the postal address.
Room: So far as the room is concerned, if you think you may want the lodger to move to another room some time, it is best to leave the wording as it is, so the agreement will still apply if the lodger changes rooms. However if you know that the lodger will only ever have one particular room, you can write this in here (e.g. back bedroom on the first floor).
Owner : This is you, the landlord. Put your full name (e.g. Mrs Angela Smith)
Lodger or licensee: Again put the whole name (e.g. Mr John Brown)
Period: Put the dates the lodger is to live in the property, and cross out as appropriate in the paragraph below. Note that the agreement provides for either party to end the agreement early on giving one months written notice, and to roll on after the end of the period, unless either of you give notice that you want it to end.
Services : Cross out the ones you are not going to apply. It is a good idea to provide at least one, for example clean sheets.
Payment : Complete this as appropriate. If payment is not going to be made by standing order, it is a good idea to keep a record of the agreed payment method. You can write this here if you wish.
Deposit : You do not have to take a deposit, but it is often a good idea. As this is not an AST, it does not have to be protected with a tenancy deposit scheme.
Inventory : If you decide to do an inventory, this should be signed by the lodger as agreed and then a copy
The Assured Shorthold tenancy agreement
Date : Date the agreement after it has been signed, ideally on the day the lodger moves in.
Property : This is the postal address of the property.
The Room : It is best to give the rooms numbers or names, otherwise say where the room is (e.g. front first floor bedroom)
Landlord : This is you. Put your full name (e.g. Mrs Angela Smith).
You also need to put your address here. Note that you need to give an address in England or Wales, so if you are based in Scotland or overseas, you will need to put a contact address here as well as your own. If a contact address in England and Wales is not provided, technically rent is not payable by the tenant until one is given (this is under section 48 of the Landlord and Tenant Act 1987).
Tenant: Again put the whole name (e.g. Mr John Brown)
The terms : Be careful about giving a long term to a new tenant, as you will find it difficult to evict unsatisfactory tenants during the fixed term. It is best not to make it longer than six months unless it is someone you know really well and trust.
The rent: Note that if the monthly rent is more than £2,083.33 (unlikely for the rent of a room!) you will not be able to use this form of agreement as the tenancy will not be an AST. It you agree with the tenant some payment method other than standing order, make sure you keep a record of this. Note that if the tenant pays rent weekly, you will need to give them a rent book.
The Deposit: This is normally equivalent to one months rent. It must not be more than two months rent. You must protect the deposit with one of the government approved tenancy deposit protection schemes.
The Inventory: This is a good idea. Make sure you check it over with the tenant and that it is signed by both of you as agreed. A copy should be attached to both copies of the tenancy agreement. Note that if you do not have a proper inventory you will find it very difficult to claim any money from the deposit, if your deductions are challenged by the tenant and go to arbitration.
That’s it! However it is recommended that you do some reading about your responsibilities as landlord. You will find some preliminary guidance here: http://www.landlordlaw.co.uk/page.ihtml?id=23&catparid=2&step=2&page=non
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