A live-in landlord, also known as a resident landlord, is a homeowner that lets part of their property out to a lodger. As the lodger is sharing the property with the owner, they are not considered as tenants. While tenants and landlords must commit to an Assured Shorthold Tenancy Agreement (AST), the rules are different where lodgers and landlords are concerned.
If you’re thinking of renting out part of your home to a lodger, this article will establish the main things to consider when creating a lodger agreement, also known as an Excluded Tenancy Agreement.
While lodgers do not have the same rights as regular tenants, it can make life easier for both the landlord and the lodger if they are both on the same page and aware of what is expected of each party. If an issue does arise, the agreement can be used to help resolve the matter.
While a standard lodger agreement template can be found online, some landlords prefer to make their own. Here are some of the primary things a landlord should consider when creating a lodger agreement…
Make the rules clear
As the lodger will be living in your home, it’s important to be clear from the get-go on what your house rules are, if any, so that you and the lodger are both on the same page. If you don’t want the lodger blasting music in the middle of the night or leaving their belongings in any communal areas, make it clear in the agreement.
As part of the house rules, the agreement should also state how you expect the property to be kept. To do this, landlords should provide the lodger with an inventory and request they read and sign it before moving in. The inventory can be used to prove the condition of the property before the lodger moves in and document how the property should be kept.
State the consequences
If the lodger happens to cause you distress or damage your property, it is up to you whether or not you keep the agreement in place and let the lodger remain in your home.
In most cases, landlords will first try and sort the situation out amicably by having a conversation with the lodger. This is then followed by a formal letter giving the lodger a second chance to put things right. If nothing changes, the landlord can ask the lodger to leave.
You should make the consequences of any trouble caused by the landlord clear in the agreement.
Include deposit details
As the lodger is not a legal tenant, you do not have to submit their deposit to the governments’ Deposit Protection Scheme (DPS). This means you can ask the lodger to pay you a deposit to cover any damages or missed rent payments.
Be clear in your agreement how much the lodger is required to pay, if anything, and state what the deposit may be used for if any issues arise.
Be clear on rent
Rent is the most important section of the agreement as it’s most likely the only reason you are letting someone come and live in your home.
The lodger agreement must clearly state how much rent is required to live in the property and the exact date it is due.
Most live-in landlords require weekly rent payments from the lodger as it protects the landlord should the lodger not pay. If the lodger misses a weekly payment, it’s better to be owed 1 weeks’ rent rather than 1 months’ rent.
The agreement should also state what happens if rent payments are missed and if the lodger goes into rent arrears. It is down to the landlord to decide how many weeks they give the lodger before taking action.
Clarify the eviction process
As the lodger is not considered a tenant, they are not protected from eviction. As long as the landlord gives the lodger a sufficient amount of time to leave the property, also known as a notice to quit, the lodger must go.
The notice to quit should be included in the agreement and state how many days you will give the lodger to leave the property.
The normal four-week minimum period of notice used for assured shorthold tenancies is not required, so if the lodger pays rent weekly, the notice period can be as short as one week.
Live in landlords do not need a court order to make a lodger leave and this should be made clear in the lodger agreement.