NELSONS' TERMS AND CONDITIONS OF BUSINESS

SERVICES AND FEES

In the event that Nelsons becomes registerable for V.A.T., you will be notified of the same and V.A.T. will be charged on our fees accordingly thereafter.
  1. INTRODUCTION ONLY SERVICE:

    2. For Landlords who merely wish us to find suitable tenants for their properties and to complete the legal documentation in the knowledge that the tenancy agreement is drawn up correctly.
    FEE: 100% of the first months rent.
    The total amount of commission payable is due at the commencement of each Tenancy and/or extension and will be deducted where possible from the initial rental payment received, with any balance owing being invoiced to you.

    The Introduction Only Service includes;
    1. A personal inspection of the property and a free rental valuation.
    2. Advertising of property and interviewing of suitable prospective tenants.
    3. Full references taken up on tenants including previous landlords/managing agents, employers, personal references and full credit check (all as appropriate in the circumstances).
    4. Preparation of all legal documentation.
    5. Collection of the first month's rent and damage deposit, whereupon the landlord takes over the management of the property and all monies collected by ourselves will be forwarded to the landlord less our agreed fees.
    6. Making every effort to notify utility companies and the local authority of the change of occupier at the commencement of the tenancy.

  2. RENT COLLECTING SERVICE

    3. Designed for the landlord who does not wish to become involved directly with the tenant in the collection of rent but who wishes to look after the maintenance of the property and to perform all other functions of management.
    FEE: Commission at £150.00 (one-off fee) + 8% of the total rents reserved under the Tenancy Agreement deducted from each rental payment received throughout the Tenancy and any continuation thereof.

    The Rent Collecting Service includes;
    1. All the services included in the Introduction Only Service (save that we shall retain the damage deposit for the period of the tenancy).
    2. Demand for and collection of rent to be paid into landlord's bank/building society account by BACS as soon as funds are cleared.
    3. Submission of a monthly statement of account to the landlord.

  3. MAINTENANCE SERVICE:

    4. Designed for the landlord who neither wishes to become involved directly with the tenant in the collection of the rent nor wishes to be involved with the maintenance of the property during the tenancy.
    FEE: Commission at £150.00 (one-off fee) + 10% of the total rents reserved under the Tenancy Agreement deducted from each rental payment received throughout the Tenancy and any continuation thereof.

    The Maintenance Service includes;
    1. All the services included in the Rent Collecting Service, plus;
    2. Arranging any necessary maintenance to the property and deducting costs from rent received. Please note: Wherever practical (except in an emergency) we will endeavour to provide you with an estimate of the cost of the works for your approval before carrying out the required works.
    3. Regular inspections.

Inventory:

Before the commencement of a tenancy we can prepare on your behalf an inventory at a cost of £45 for the first hour and £25 per hour thereafter.

Value Added Tax:

Except where otherwise stated, our fees and any other charges which we may make will be subject to V.A.T. at the appropriate rate.

Duration of Agreement:

This appointment is for an agreed initial period of six months and thereafter subject to three months notice to terminate on either side. Please note: In the event that a Landlord fails to comply with any statutory obligation we reserve the right to terminate this agreement with immediate effect.

Rent remittances:

Present banking arrangements are such that it is necessary for us to allow approximately 10 working days for rent cheques to be cleared before transferring monies to landlords' accounts. No rent will be payable to the landlord until we hold cleared funds from the Tenant.

Deposit:

All deposits are deposited within 14 days with the Deposit Protection Service.

Notices:

Prior to the end of the fixed term of the tenancy agreement you must notify us if you require possession of the property. Upon receipt of your written instructions to this effect we will serve notice in the prescribed form.

Statutory Applications, Court Fees and Legal costs:

Should it prove necessary to take legal action in respect of the tenancy, you will be responsible for instructing your own solicitor and paying court fees and legal fees. We will liaise with your solicitor and provide all reasonable assistance.

Sale of property to a third party:

If the landlord sells the property to a third party and the tenant introduced by ourselves remains in occupation the landlord will be liable for all of our fees until the tenant vacates the property.

Purchase by Party introduced by us:

In the event of a party introduced by us (or any person or body corporate associated with that party) subsequently purchasing the property, whether before or after entering into a tenancy agreement, commission shall be payable to us on completion of the sale at the rate of 1% of the sale price, plus VAT at the standard rate.

Indemnities:

The landlord agrees to indemnify us as agents against any costs, expenses or liabilities incurred or imposed on us provided that they were incurred on the landlord’s behalf in pursuit of our normal duties.

Board:

The landlord agrees that we can place a TO LET/LET BY flag board at our own expense outside the property, provided this complies with the local authority regulations.

Commissions and interest:

Any commissions, interest or other income earned by ourselves while carrying out our duties as agent for the letting and/or management of the property will be retained by ourselves.

Alteration of terms:

We reserve the right to alter the terms and conditions of business by giving the landlord not less than three months notice in writing of the changes. At the end of that period of notice the new terms and conditions will apply.

Arbitration:

Any dispute between the landlord and ourselves arising out of this Agreement may be referred at the instance of either or both parties to be determined by a sole arbitrator to be agreed between the landlord and ourselves or, in default of agreement, appointed by the President or Vice President for the time being of the Royal Institution of Chartered Surveyors.

Taxation of the non-resident Landlord:

Where the landlord of the property has a normal place of abode outside the U.K. the Commissioners for the Inland Revenue will hold us, as your agents, responsible for the payment of any tax liability which arises on rents collected by us on your behalf, unless you have obtained an approval number. If you do not hold a certificate and you are resident abroad, it will be necessary for us to deduct income tax at the rate of 22% of the gross rent less allowable expenses and to pay such sums over to the Inspector of Taxes on a quarterly basis. Similarly, if you at present live within the U.K. but subsequently move abroad, it will be necessary for us to commence this deduction from the time you leave this country unless you obtain an approval number. We regret the necessity to make such deductions but you will appreciate that we have no alternative in view of our responsibility to meet the tax liability on your behalf if you have not obtained an approval number. If you as Landlord are resident in the U.K. you should declare your residential lettings income to the Inland Revenue annually as it is assessable for income tax.

Rent Guarantee and Legal Protection Policy:

In the event that your tenant defaults in the payment of their rent, you will receive the income regardless, until such time as the tenant vacates or a possession order is granted. In addition to this, you will not be responsible in any way for costs incurred in obtaining possession of your property. Obtaining a possession order and instructing solicitors and counsel can cost in the region of £1,000 to £2,000, however this will be paid for on your behalf. We will provide you with further details, including cost, upon request.

General points:

Who pays what?:

The tenant is responsible for payment of all the following from the start of the tenancy unless otherwise negotiated prior to the commencement.
Electricity
Gas/heating oil
Council tax
Water rates
T.V. license
Telephone line rental and call charges
Contents insurance (Tenant's possessions only)

You, as a landlord, are responsible for payment of the following:

Mortgage and any other loan secured on the property.
Buildings insurance.
Contents insurance - see "Insurance" below.
Where you lease the property yourself there may well be an annual maintenance charge and ground rent to pay to your own landlord. All utility bills up to the point your new tenant takes up occupation.

Insurance:

It is vital that landlords have both Buildings and Contents Insurance. But when it's an unfurnished tenancy, why should the landlord arrange Contents Insurance? There are two very good reasons; Firstly, for things such as leaks, smoke damage and floods, these are not structural hence buildings insurance does not cover such claims. The other and probably most overlooked item is the public liability section of most Contents policies. It is obviously very important that the cover is adequate to cover any accident or incident during the Tenancy. You will need only fairly basic cover as the tenants are responsible for insuring their own items. It is VITAL that you inform your insurance brokers that your property is about to be let as they will not honour any claim if they find out it is rented and they have not been informed.

Leasehold Properties:

If your property is leasehold your lease will specify if it is necessary to obtain permission to sublet. It is wise to be certain as this may affect your insurance and it is good practice for any Management Company to be aware so that they can send any maintenance/ground rent demands to you direct.

Mortgages:

If you have a mortgage on your property your lender will probably want to be made aware and approve any let in advance.

Repairs:

As a landlord you are obliged to keep the property you let in "Tenantable condition", which means that the heating, hot water systems, electricity, gas, water, drainage, appliances and any other working system in the property is kept in working order from the start of the tenancy. It is strongly recommended that you leave photocopies appliance/central heating manuals in the property. Should a tenant cause damage by negligence, knowingly or otherwise, which is deemed to be in excess of fair wear and tear, then the repair charges will be for the Tenant to pay and will be deducted from their damage deposit.

Stamp Duty Land Tax:

As from the 1st December 2003, Stamp Duty changed. As from that date it is known as Stamp Duty Land Tax (SDLT). Full details are available on the Inland Revenue web site www.inlandrevenue.gov.uk. From the above date the threshold for payment of Stamp Duty will no longer be rent over £5,000 for the period of the tenancy. Instead the threshold for SDLT will be rental income due under the period of the tenancy which exceeds £60,000.

STATUTORY REGULATIONS

The main regulations are as follows:

The Gas Safety (Installations and Use) Regulations 1998

Under this Act; 1.All gas (including propane gas) fuelled appliances must be inspected annually if installed in rented properties. 2.Records must be kept of all safety inspections (form CP12) and be available to Tenants at the commencement of the Tenancy and within 28 days of replacement. 3.Only qualified firms or individuals (Corgi registered) may install or maintain gas appliances.

The Smoke Detection Act 1991

This Act makes it mandatory to fit mains powered smoke alarms in all new residential buildings with at least one on each floor. Whilst it is not currently statutory in older properties it is obviously good practise.

The Electrical Equipment (Safety)(Amendment) Regulations 1994

This regulation requires that all electrical installations and appliances are safe. All appliances must have instruction books left at the property.

The Furniture and Furnishings (Safety)(Amendment) Regulations 1993

Under this Act the Landlord has the obligation to ensure that all furniture in properties being rented for the first time, or any new or additional furniture being provided to the rented property must comply with these regulations by displaying a label stating they are fire resistant and meet with current legislation. If items of furniture do not comply with the furniture regulations, the Landlord must either replace them with compliant items or remove them from the property before any tenancy commences. Failure to comply can result in prosecution.