There has been much in the media about homeowners suffering from the credit crunch and searching for remortgages. However, the credit crunch is also affecting tenants too and new research has shown they are bailing from their rental accommodation to avoid paying the bills.
The Letting Protection Service (LPS) release recent figures showing 1,232 landlords suffered from a ‘runaway’ tenant in November last year, an increase of 122 since November 2007.
A tenant who abandons their rental accommodation could be breaking the law and it is likely to have an adverse effect on their credit rating too.
Last month, buy to let mortgage lender Paragon Mortgages also showed a third of landlords did not conduct reference or credit checks on tenants and that tenants leaving when their rent gets behind is more common than people may believe.
Landlords can get protection from this sort of issue by taking out landlords insurance, however, according to LPS, there are thousands of landlords who have not got this and due to the current economic climate, they are likely to lose out.