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Wellesley Finance makes loans solely to businesses (these business loans include but are not limited to business development finance, business buy-to-let, and first/second charge loans for business purposes). As a result, these loans do not have the benefit of the protection and remedies that would be available to you as a consumer in the context of a non-business loan. Wellesley Finance is not permitted to undertake retail loans to consumers. If you are a retail consumer seeking a non-business loan, you should not seek to obtain a loan from us. Business loans will be secured on relevant assets and these assets are at risk in the event of the loan being in default. A property asset may be repossessed if repayments are not kept up on a loan or other asset secured on it. If you need advice on any of these matters, or you are in any doubt as to the consequences of taking out a loan with Wellesley Finance (including not being regulated), you should seek independent advice from an appropriately qualified professional. Wellesley Finance recommends that you consider whether a potential business loan meets your own creditworthiness, risk levels and objectives. You should be seeking to borrow funds only if you believe that your business activities are capable of repaying those funds and that you have considered the required repayments in relation to your other financial commitments.

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The 3 New Rental Rules Landlords Need to Know

November 24, 2017

The government, set on levelling the playing field between homeowners and landlords, have hiked up taxes and put new legislations in place. Experts believe future new rules could further discourage investment in the private rental sector, despite the UK being desperately in need of rental housing.

Outlined below are three new rules for landlords that are expected to become law as soon as 2018. Both landlords and tenants are likely to see stark changes in the rental market if the proposed legislation is implemented.

Tenants to be Free of Fees

Confirmed in the Queen’s Speech back in June, letting agents will soon be banned from charging tenants’ fees. Currently, agents charge for everything from inventories and references to phone calls and postage. Essentially, if it takes their time, most lettings agents are happy to charge tenants. However, this is set to change.

Known as the Tenants’ Fee Bill, this legislation is set to be drafted by the end of the year and put into action as soon as 2018. Whilst this is great news for those who rent, landlords are expecting a backlash as estate agents will still want to make their money. Many landlords are assuming that they will have to incur these fees instead.

For this reason, we could see an increase in rental values as landlords aim to cover these fees. Alternatively, many may choose to withdraw from using agents and let their property privately.

Government to Cap Rental Deposits

Standard practice for landlords is to take a deposit from tenants at the start of tenancy to cover any loss or damage during the rental period. Often, this fee is over one month’s rent. The tenancy fee, plus having to pay the first month’s rent up front also, can have some renters severely out of pocket. Currently, the National Landlords Association reported that 40% of deposits exceeded one month’s rent.

Going forward, landlords will only be able to charge a maximum of one month’s rent as a deposit. The government is making this change to “make the rental market more affordable and competitive.”

Whilst the cap could be a real bonus for those who rent, it does come with some negatives. The deposit is there for landlord security and is often increased for those who have young children or pets. These ‘riskier’ tenants could face refusal from landlords as their security deposit would not match the assumed ‘risk’.

If the cap on security deposits comes to fruition, only time will tell if it is of the benefit to both tenants and landlords.

New Rules for Private Rental Properties

From April 2018, new Minimum Energy Efficiency Standards (MEES) set out by the government will affect private rental properties in the UK. Every property in the UK has an Energy Performance Certificate, also known as an EPC. Efficiency ranges from A (most energy efficient) to G (least energy efficient) and the status remains for 10 years.

The new legislation will prohibit landlords from letting a property with an EPC of F or G – the two lowest ratings. These properties, given their poor energy efficiency rating, do little combat emissions and tenants can often face higher than average gas and electricity bills.

Whilst this will only affect new tenants moving into properties as of April 2018. Landlords should be aware that this will affect all other tenants too when it comes to annual lease renewal as of April 2020. This gives landlords plenty of warning to start considering improvements to their properties to bring them to at least an E rating. If not, landlords will be letting their property illegally and will face heavy fines and legal action.