1) A tenancy isn’t legal without a signed Tenancy Agreement
Landlords don’t need a written Tenancy Agreement in order to create a legally binding tenancy, although it is strongly advised. A tenancy Agreement can actually be an oral agreement– an extremely unsafe option.
In most cases, if a tenant pays less than 100k per year in rent, moved into the property on or after 28th February 1997, and has rights to have privacy in the property where the landlord cannot enter the property without mutual agreement, then an Assured Shorthold Tenancy is automatically created, with or without a signed tenancy agreement.
2) You need to renew a Tenancy Agreement after it expires
Apparently this is rumour is strongly endorsed by letting agents so they can charge “tenancy renewal fees“. Fortunately, it’s perfectly legal and valid for a tenancy agreement to continue even after the fixed dates have expired. There’s no legal requirement to renew the contracts.
When a Tenancy Agreement expires and is not renewed with a new contract, the tenancy rolls into a Periodic Tenancy.
Here’s a much more in-depth article on renewing tenancy agreements.
3) A Tenancy Agreement has to have a minimum of 6 months
I hear/read this statement all too often from people, even professionals with in the industry.
Before February 1997, an Assured Shorthold Tenancy actually couldn’t be less than 6 months. But that changed after February 1997; now it can be as short as 1 day. So no, the fixed dates in a Tenancy Agreement do not have to be at least 6 months.
However (here’s the kicker), the law states that possession orders are not enforceable within the first six months of a tenancy unless there are grounds for eviction. So what this means is that a tenant can have a two month agreement (i.e. the tenant can leave if he wishes at the end of the short term), but the landlord won’t be able order for possession (i.e. reposes the property) until after six months if the tenant wishes to stay longer than the agreed 2 months.
4) Only letting agents can legally create Tenancy Agreements
I’ve actually had a letting agent tell me this before! It’s a long and ridiculous story, but essentially, the letting agent wanted me to pay a renewal fee, consequently deemed it appropriate to lie to me in an attempt to jack me for money. It literally was a daylight robbery attempt.
Bottom line, letting agents are NOT the only outlet for legally creating tenancy agreements. You can download/purchase them from many outlets. Hell, you can even create your own.
5) Tenancy Agreements need to be completed by a qualified professional
Again, complete rubbish. You can download a tenancy agreement online, and fill in the missing spaces (tenant name, landlord name, rent etc.) for yourself.
6) You can put any clause in a Tenancy Agreement
Absolutely incorrect. Before you consider adding your own make-shift clauses into a tenancy agreement, you should ensure it’s enforceable by law.
Every clause in a tenancy agreement MUST be “fair” otherwise the landlord could fall foul of the Unfair Contract Terms legislation.
Both landlords and tenants have statutory rights which are stipulated in the The Housing Act 1988. Clauses put into a Tenancy Agreement which conflict with statutory rights are not enforceable, even if the tenant signs the contracts and agree to the terms.
It’s important to be diligent when adding clauses to pre-written/purchased agreements as you may be inadvertently restricting your rights in law. If you wish to add your own clauses into an existing Tenancy Agreement it is recommended to seek advise from a professional before doing so.
Can you think of anymore?
Have you heard of any more myths relating to Tenancy Agreements? Let me know, innit!
Disclaimer: I'm just a simple landlord blogger, I am not qualified to give legal or financial advice. Any advice I give is my opinion based on my experience, and is never legal or professional advice. You should always get professional advice on any legal and financial matters!