Furnished rental: What to do in case of unpaid rent?
There are numerous as to why tenants are unable to pay rent. From unemployment to medication bills for long-term illnesses, it's sometimes difficult to pay rent on time. Or in some cases, pay it at all. Fortunately, there are some measures and provisions that both the tenant and the owner/landlord can take to avoid the cancellation and termination of the lease and eventual eviction.
Generally, rent is considered unpaid when payment is not made on the date set on the lease. But according to the Caisse d'Allocations Familiales, when the tenant fails to pay two months' worth of rent excluding extra charges (before the deduction of aid), it will be considered unpaid rent.
When is a rent considered unpaid?
Rent is considered unpaid when payment is not made on the date set out in the lease.
According to some organizations, in particular according to the Caisse d'Allocations Familiales, the rent is considered unpaid when the debt exceeds more than two months' rent excluding charges (before deduction of aid).
What are the solutions to help tenants?
In light of various situations, tenants can take certain measures to prevent non-payment of rent:
- Apply for housing assistance from organizations such as the Caisse d'Allocations Familiales (CAF). They can help you pay the rent monthly. But in the case of two months' unpaid rent, the CAF will suspend the aid.
- Call on the FSL (the Housing Solidarity Fund) for financial assistance.
- In case of dispute with the owner, you can:
- Call on a Justice Conciliator to help settle the matter.
- If a lease has been completed, request a delay for the payment from the judge.
What are the owner's recourses in case of non-payment?
The first step is to give a tenant notice before anything else.
The goal is to communicate with the tenant and understand how this happened. As well as to potentially find an amicable solution. This situation might just be temporary, so finding an arrangement between the two parties (i.e. payment delay) would be the most appropriate solution.
If the tenant becomes unreasonable and starts to abuse the leniency, here are the solutions available to owners/landlords:
- Appeal to the entities who have vouched for/recommended them
- Call on a guarantor to set up a file and subscribe to unpaid rent insurance or “Unpaid Rent Guarantee (GLI)”
- Call Action Logement if the tenant has opted for the Visale Guarantee
- Call on a Bailiff (the costs will be added to the unpaid and will be paid by the tenant)
- Take the tenant to a district court (excluding winter break)
If the Commissioner of Justice is called, here are the possible scenarios:
https://www.demarches.interieur.gouv.fr/particuliers/loyers-impayes-expulsion-locataire
It's good to know that...
Do note that the tenant has two (2) months to repay his debt and the termination clause of the lease is excluded during this period. If the tenant still has not paid, the landlord is prohibited from evicting them immediately. Instead, they must procedure set up by the bailiff, under penalty of resorting to 3 years in prison and a fine of € 30,000.00.
When does the landlord have to declare unpaid rent?
The first declaration is addressed to the tenant in the form of a formal notice with an acknowledgment of receipt. This formal notice must be sent within 15 days of the discovery of the unpaid rent.
A second declaration can be made either to Action Logement if the tenant has chosen the Visale Guarantee, or to the tenant's guarantor/insurance provider, within 30 days of the discovery of the unpaid rent.
For the third declaration, the owner then reserves the right to report the unpaid rent to the CAF within 3 months of the discovery of the unpaid rent.
How to avoid unpaid bills and what is the payment deadline for unpaid rent?
- Ensure the solvency of his future tenant, who must have at best income 3 times higher than the amount of rent; otherwise, justify a stable job.
- Remember to analyze the rental file and attachments. If you are a tenant and you do not know how to build a real estate rental file, click here!
- Provide a deposit to compensate for the possible default of the tenant, in order to secure the sustainability of the rental investment
- Subscribe to an unpaid rent insurance or "Unpaid Rent Guarantee (GLI)"
- Use guarantors or a guarantor company, a surety organization such as our partner garantme.fr
- Write a rental agreement with a clause to anticipate the cancellation of the lease in case of problems.
- Rent your accommodation furnished
- Entrust your furnished apartment to a specialized agency (such as A1 Real Estate which will look for corporate clients, diplomats, foreigners on professional mission and any other person with a need for professional mobility)
- Rent your furnished apartment on a mobility lease
- Rent your furnished apartment under Civil Code Lease (second home or to a company)
- Check the tenant file
The tenant has 2 months to pay the sums claimed and the costs of the commissioner of justice.
After this period of 2 months (or the payment period granted by the judge):
- If the tenant has paid the sums due, he can stay in the dwelling
- If the tenant has not paid the sums due, the landlord must refer the matter to the protection litigation judge so that he can see that the lease is terminated and that he pronounces the eviction of the tenant. The owner may refer the matter to the judge in summary proceedings.
- The judge can still grant payment deadlines to the tenant who is able to settle his rental debt. During this period, the effects of the termination clause are suspended.
- There are various possible causes for the unpaid rent (i.e. unemployment, illnesses, etc.)
- The owner/landlord's first response is to always communicate with the tenant clearly and try to settle the matter outside of court.
- The rent is considered unpaid from the moment the deadline set on the lease has passed.
- The are three phases of declaring unpaid rent.
- There are various solutions to help deal with unpaid rent (i.e. APL, FSL, Unpaid Rent Insurance, etc.)
- Owners have several recourses in case of non-payment of rent (i.e. appeal to guarantors, bailiff, justice, action to housing)
At A1 Real Estate, we understand that owners/landlords are reluctant to rent out their properties due to certain abuses like unpaid rent. This is why we take into account all the provisions and guarantees that will help us carefully choose the best rental files among prospective tenants. These files are in line with financial institutions, social organizations, and rental guarantors, such as our partner garantme.fr, to eliminate any risk of non-payment of rent.
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Posted on 02/12/2022 by
Andy LECUYER
