The introduction of CRAR procedures in 2014 has meant that some landlords have to deal with recovering outstanding rent differently. The change in procedure means that landlords can no longer use the landlords’ right of distress against their commercial tenants who have failed to make rental payments.
Does it affect residential landlords?
Landlords who do not own commercial properties will not have to use the CRAR procedure to recover outstanding rent, and should continue to use the correct rent recovery procedure. When needing to retrieve rent arrears and regain possession of your residential property, landlords should use a County Court Judgement (CCJ).
With a CCJ, landlords can then apply to the court for a ‘warrant’ so that an enforcement officer can visit the property to collect money owed or repossess goods to cover the cost.
Landlords who own combined premises
Landlords that own commercial premises that also contain residential accommodation, like a pub or a corner shop, may not be able to use CRAR to recover outstanding rent. In these instances, CRAR can only be used if the residential accommodation is rented on a separate lease and has a separate entrance. If the lease covers both areas of the property, then a CCJ will be required to recover the rental arrears.
Commercial Rent Arrears Recovery (CRAR) procedures can only be used if the money owed exceeds the minimum amount of 7 days’ rent, and does not cover additional costs such as interest and VAT.
Able Investigations is an enforcement agency that is experienced in helping landlords recover rent arrears for both commercial and residential properties. If you are a landlord who is struggling to retrieve rental arrears from your tenants and would like to know more about how we can help, please get in touch with a member of our professional and qualified team by calling 0345 366 0000.