Categoría: News

• Only My Share warns of the dangers of joint and several liability clauses
• Huge rise in payouts highlights the risk to parents
• Withdrawal of pandemic-related government support creates even greater need for caution

Rent arrears protection service Only My Share has issued a stark warning to parents after a rising number of claims has seen its loss ratio increase by 350% over the past year. The company is hoping that parents can learn from its experience in order to protect themselves financially, particularly in the face of pandemic-driven government support beginning to fall away.  

“Many families are likely to be feeling the financial pressure as this year progresses. Yet many are also unaware of precisely what they are committing to when signing a tenancy agreement with a joint and several clause in it. With students already seeking accommodation for the 2021/22 academic year, we are keen to warn parents to be cautious.” Edmund Fulford, Relationship Manager, Only My Share

Under a joint and several clause, the tenant is liable for a housemate’s rent if that housemate doesn’t pay. This applies regardless of whether the tenants even know each other. Students looking to live in houses in multiple occupation (HMOs) and any parents who sign up as their guarantors therefore need to be on the lookout as they are also legally liable.

Only My Share, which is part of the Housing Handfamily, is an insurance-backed guarantee service that prevents individuals from being liable for their housemates’ rent, for a fixed cost of £99 per year for protection of up to £10,000. With the guarantee in place, if a landlord demands rent that another housemate owes, Only My Share steps in and makes the payment.

With so many students defaulting on their rent in the past year, Only My Share has come to the rescue time and again – hence the company’s 350% loss ratio increase. Relationship Manager Edmund Fulford comments:

“It’s been an expensive year for Only My Share, but the pandemic has also shown the strength and solidity of the brand. There’s a definite sense now that if we can get through everything that the pandemic has thrown at us then we can survive any challenges that the future may hold.”

Only My Share recently revealed a new partnership with StudentTenant.com, the UK’s largest online student letting agent. The company is also deep into partnership talks with two other companies, with announcements to follow in the coming months. According to Fulford, the last few months have been incredibly busy on all fronts. He concludes:

“Awareness of the dangers of joint and several clauses is growing, but at a very slow rate. We’re looking to fast-track that knowledge. The level of payouts that we’ve made as a result of the pandemic should demonstrate to students and their parents just how vulnerable their position is if they sign a rental agreement that includes a joint and several clauses. Only My Share can de-risk that vulnerability by £10,000.” Edmund Fulford, Relationship Manager, Only My Share

For more information, please contact Only My Share today on +44 (0) 203 887 2961 or visit https://onlymyshare.com/

We were featured in the Telegraph in an article about the “Dangers of Joint Rental Contracts” , this issue is becoming even more prevalent especially in the last 12 months. As renters are increasingly uncomfortable with taking on additional financial responsibilities, with the ongoing uncertainty in the marketplace, renters and their guarantors are taking every precaution they can. 

The article highlighted case studies about tenants and their parents who have been chased for hundreds of pounds after horror story housemates have failed to pay their share of the rent, which is becoming the norm more than ever before. 

James (who asked to use a pseudonym) was a customer who contacted Only My Share, shared his story with the Telegraph.  He was in his final year of University and along with three of his housemates was being chased for £800 of outstanding rent by their landlord after the fifth person they lived with failed to pay. 

The fifth housemate was non-contactable as he had just upped and disappeared after they finished their exams and he stopped paying his share of the rent. James and the rest of the housemates were in a predicament as they did not have the funds to pay. Their parents, who were their guarantors had to step in and pay £200 each, to cover the arrears. There was also additional charge as damages to the property exceeded their deposit, once again the parents had to pay for the fifth housemates share of the amount. 

James’ is just one story that highlights some of the issues that can arise when people fall into rental arrears and the implications this has on their housemates under a Joint and Several contract. There are many others who have experienced similar or have been in worse situations than James, to read the full article on the Telegraph click here.