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Question Title: Renewals Again
| Question: 276 |
| It is common in the lettings business to have disputes with the Landlord over agent's extension fees and the complaint that "You haven't done anything, so why should I pay ?" Are there cases whereby an agent has sued a Landlord for an extension fee, and also have you any further relevant information that would help our industry with future devious Landlords ?
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| Answer: |
| Again, this is another interesting issue with respect to tenancy renewals. One of the situations which give rise to the most frequent complaint by consumers in the letting industry is the case where a simple fee is charged to find a tenant for the landlord (say 10% of the rent) and the landlord is charged the same fee again on renewal. We know of no specific cases where this has been tested in court but feel that this business practice is unlikely to survive the scrutiny of the Unfair Contracts Act 1977 ( or the new EEC Unfair Contracts Directive planned for introduction later on this year) Instead of charging the same fee on renewal as for the original tenant search, we would suggest that you reduced your renewal fee to say 5% or 7.5% in recognition of the reduced work involved. If your renewal fee includes the preparation of a new agreement for the new term, then the renewal fee seems to be more justifiable.
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References:
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Pages:
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Hyperlinks:
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Letting Update Journal |
Jan 1997 page 25 |
letting-update-journal.html
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Letting Handbook |
Chapters 5 & 9 |
letting-handbook-and-factsheets.html
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For more information, discuss on the Forum
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