If you manage to reach an agreement with your tenant, for example that they will pay off the arrears by regular monthly instalments, it is important that you write to them confirming the agreement that has been reached.
Letter 4 – Confirmation of agreement letter.
Send this letter when you have reached agreement with your tenant, to confirm the things agreed. It is very important when reaching agreement, that there is a contemporaneous record in writing setting everything out clearly. Otherwise there may be arguments later about what was actually agreed (remember people’s memories vary widely, even when they are not being devious!).
I have done a draft letter you can use or adapt. In my draft, the details of the agreement go in the middle of the letter – if the agreement is too complex and there is not enough space here, you can put ‘see attached page’, and then put the details of the agreement on a separate page and attach it to the letter.
Another reason for sending a letter like this is that you need to make it clear to the tenant that if they fail to honour their agreement, you reserve the right to go to court.
You will find a pdf version of this letter >> here.
Letter 5 – Warning letter when agreed payments not met.
If your tenant fails to make any of the agreed payments, this letter can be sent.
Complete the main information for the letter exactly the same as for letter 4 above. However you also need to give the date you sent letter 4.
You will find a pdf version you can use >> here.
If payment is not received then you can proceed to stage two.
The checklist includes sections to put details of any agreement reached and provides spaces for recording the dates that the relevant letters are sent. If the arrears are repaid, then put this at the end of the page. If the tenant falls into arrears again, you should start a new checklist sheet.
Note – using without prejudice
If you send any correspondence to the tenant regarding an agreement before the agreement is finally reached, your letter should have ‘without prejudice’ written at the top.
This means that if you fail to reach agreement and decide to sue the tenant for rent arrears, strictly speaking the ‘without prejudice’ correspondence should not be shown to the Judge unless both parties agree.
For example it should not be used by the tenant to allege that if you were prepared to accept instalments then you must accept them now.
You should always keep the without prejudice correspondence separate from other correspondence (known as the open correspondence) such as formal demands requesting the full amount due.
You can read more about without prejudice >> here.