Guaranteed rent is a brilliant scheme that can give landlords peace of mind that their rental income is protected.
The main appeal of guaranteed rent is that the rental income is secure, even if the property is empty or the tenant misses payment. This is because the guaranteed rent provider (often an estate agent) takes responsibility for the payments. There are plenty of other benefits too, like complete management and repairs and maintenance.
In this article, we’re going to talk through some key phrases and terms that surround guaranteed rent, clearing up any confusion about exactly what this scheme is.
Also known as rent-to-rent, this is the type of scheme LTA Direct specialises in. A third party (that’s us) leases the property from the landlord, paying the landlord a fixed amount of rent each month.
This third party then sublets the property to the tenants, taking care of any management, repairs and maintenance throughout the contract.
This is another type of guaranteed rent scheme, it enables landlords to rent their property to a local council, in exchange for guaranteed payments.
With this scheme, the council will pay the rent directly to the landlord and the landlord has the freedom to choose the tenants. This is a type of social housing agreement.
This is a risk-management product that can protect landlords if a tenant misses their rent payments. It’s also known as tenant default insurance.
It will typically cover the loss of rent, protecting the landlord’s income, but usually, landlords can only use it if they’re seeking repossession of the property. It might also cover legal expenses.
So, there are two types of guaranteed rent, letting-agency-backed and council-backed. Below, we’re going to compare the pros and cons of each.
For reliable guaranteed rent services, our expert team provides knowledgeable advice and comprehensive solutions, backed by a deep understanding of the local real estate market. Get in touch with us now to benefit from our guaranteed rent services.
