Solutions to Landlord Problems

Being a landlord is not easy, they are navigating constantly changing laws, buying and managing multiple properties and tackling problem tenants, there’s a lot to deal with.

Rightmove revealed last week that nearly a quarter of landlords it canvassed are reducing their portfolios as the government’s assault on the buy-to-let sector continues.

The increased costs following the tenant fees ban, drastic cuts to mortgage interest relief and reductions in expenses landlords can claim for wear and tear mean that, of the landlords who talked to them, 13% said they are planning to shrink their portfolios while an astonishing 11% reported plans to sell their entire property holdings.

Rightmove’s housing market analyst Miles Shipside said:

“Worryingly for tenants there are signs that the stock shortage may worsen if some landlords follow through with their plans to sell up, though an increase in plans for build to rent properties may help to fill some of the gap.

“The overall feeling among those landlords who are planning to exit the market is one of frustration with many telling us that the tax changes mean it’s no longer financially attractive to keep their properties.”

Changing Laws & Taxes:

Not only is the full implementation of landlord stamp duty a concern but also the introduction of the new Homes (Fitness for Human Habitation) Act 2018, which came into force on 20th March has further highlighted the need for landlords to maintain their properties. Failure to do so could result in court proceedings where the tenant could be awarded damages if the property does not meet the standards required by the Act.”

Future debt threats to landlords:

What negative equity solutions are available:

We understand sometimes circumstances change that you cannot control. We are here to help you get out of these situations and get you moving on with your life.

Whether you feel stuck with a property you no longer want, you have a rental property that no longer makes financial sense, perhaps due to negative equity, or you have an interest only term coming to an end with no way to repay the loan, there are solutions.

Landlord Debt Advisory has helped landlords to write off over £126 million of negative equity debt.

We can help you with the following situations:

  • Mortgage Mis-selling complaint (all these points will be hyperlinked to
  • Mortgage re-negotiation
  • Negative Equity Settlement
  • Property Debt IVA
  • Bankruptcy

What is the next step?

Landlord Debt Advisory (part of the CD Fairfield group) is authorised and regulated by the FCA to review, advise and represent UK property owners in relation to mortgage debt. We have completed over 3000 case reviews, advising landlords and homeowners from every walk of life. Why not tap into our experience today and see how we can help you? Call us on 0161 222 4311.

North East England still trying to recover from ‘fake’ promises

Just before the house price bubble burst in the summer of 2008 buy-to-let seminar firms were promoting the north east of England as the holy grail for Landlords.

Investors were signed-up with the promise that they would become “property millionaires”. It was all too good to be true but many UK and Northern Ireland investors were caught-up in the ‘dream’ and invested their money.

From 2002, these companies advertised free “workshops” in newspapers, on the radio and via a mailshot campaigns. Thousands signed up, sometimes handing over £10,000s in seminar, membership and sourcing fees.

Once hooked by the promise of property wealth, the companies stoked the frenzy even further, promising a fast road to riches via sales of flats bought “off-plan” in Spain and Florida, as well as the UK. These properties were often little more than a developer’s intention for the future.

Since 2008 many of these firms went bust, leaving many would-be landlords nursing losses ranging from about £50,000 to more than £500,000.

After the firms went to the wall, thousands of property owners were left with assets worth far less than they had paid for them and in the current economic climate they are struggling to financially recover.

Some had title to, or had paid deposits on, properties which remain unfinished or not even started. Others were not worth the purchase price and remain in negative equity.

Investors from 2005-2008 were hit with the double-whammy of paying for overpriced properties back then and now the North East property market is still well behind other regions, with price growth hardly registering as prices are now 10% lower than they were in 2007, which is 12 years ago (according to the Office of National Statistics).

The Demos-PwC Good Growth for Cities Index 2018 measures the performance of 42 of the UK’s largest cities against 10 indicators including employment, health, income and skills, housing affordability and environmental factors.

The latest index has Newcastle Middlesbrough/Stockton and Sunderland all in the bottom 10, with all three areas being ranked poorly on income levels, health and home ownership.

Newcastle has also improved from 38th in the UK 10 years ago to 33rd now, though Sunderland is now ranked joint bottom with Swansea.

The prospects of getting a return on these investments are not favourable and investors are losing money. Many properties are in run-down areas and are hard to sell as the ‘dream makers’ oversold the locations when they were trying to off-load them.

Landlord Debt Advisory has grown into the UK’s leading Non-Statutory and Statutory property debt specialist.

We are ideally placed to represent clients in all aspects of property debt having unparalleled  experience in negotiating sales and settlements for Landlords with insurmountable negative equity throughout out the UK.

Since 2013 we have completed debt settlements leading to over £70million of debt written down for their clients.

As a CD Fairfield Capital brand, Landlord Debt Advisory operate under the regulatory framework of both the Financial Conduct Authority and Chartered Accountants Ireland, this gives our clients the highest possible degree of protection and comfort.

Every client receives a bespoke, personally tailored service and proposal that meet their specific needs and the criteria of their lenders.

Landlord Debt Advisory has developed strong insight and relationships with all the main UK lenders, due to our transparency and consistent approach.

We have been assisting clients with these problematic portfolios – advising them on which properties to retain and which to resolve or sell.

As a company we have successfully completed sale and settlement cases for 100% of all Landlords who have instructed us to assist them since 2013.

CD Fairfield Managing Director Phil Davison said: “There won’t be a situation that we have not seen before and there is an answer to any situation. It depends on the client and what he or she wants to do.

“Before our clients make any decisions we are going to look at all of the options available to them. Using our experience and tried and tested case review process we’ll then make the appropriate recommendation but it is up to the client to decide what way we move forward from there.

“The other option after being informed of all options is that they take no action and wait and see what happens with the market long term. At the end of the day none of us know what is going to happen eight to ten years down the line.

“Looking at some parts of the UK that haven’t recovered from 2008 it does not look great. So, for the sake of having a conversation with us and being better informed it makes sense to get in touch. Our team is comprised of CeMAP qualified mortgage advisers, ex-bank staff, Chartered Accountants, an Insolvency Practitioner, asset management and legal professionals who have completed 100s of cases for Landlords and homeowners. We currently have over 700 ongoing cases, with well north of 1000 properties being worked on as we speak.

“Naturally people who chose to get into investment are doing it looking for a positive outcome. In most cases, they get that but in some they don’t. We are here to assist when it hasn’t worked out.

“It’s sad that many clients have been clinging on for many years to buy to let investments that will never work out. Unscrupulous property sourcing and investment firms have a lot to answer for.

“We tell people what their options are which can include selling some negative equity properties and negotiating affordable settlements in respect of the shortfall or re-financing to reduce the cost of debt to put the client into a sustainable long term position.

“It’s not about doom-mongering. Situations can improve and get worse. but this is about informing people and giving them the right advice.”

If you are concerned about any of your properties in your portfolio that are in Negative Equity see how we can help you today on 0161 222 4311.

Landlord Selling Up

Tenants in the private rented sector could find it much harder to rent a property, according to new research by the Residential Landlords Association.

A survey of more than 3,000 landlords conducted by the RLA has found that 22% are planning to sell at least one of their properties over the next 12 months, while at the same time 33% report growing demand for rental accommodation over the last three years.

According to the RLA, who used figures from HMRC, if these landlords reduce their portfolio by only one property each, that would amount to a total loss of 76,000 properties available to rent over the next 12 years.

More than a third of the landlords surveyed, 35%, said that recent tax changes including Section 24 phasing out mortgage interest tax relief and the hike in Stamp Duty, along with other reforms to the private rented sector, including the cap on tenants’ deposits and the ban on letting agents’ fees, were forcing them to withdraw from the sector or increase rents.

The RLA Chairman, Alan Ward, said:  “As demand continues to increase for homes to rent, punitive tax changes are discouraging investment by the majority of good landlords who want to provide accommodation.

“Whilst efforts by the Government to support institutional investment in the sector are welcome, this will remain a drop in the ocean.

“To meet demand, we need pro-growth taxation that actively supports and encourages the majority of landlords who are individuals providing good housing, to invest in the new homes to rent we so desperately need.”

The new research from the RLA comes as UK Finance also published research showing that buy to let investors were pulling out of the capital and investing elsewhere, with Manchester a preferred destination.

Together the figures from the RLA and UK Finance suggest that the impact of a shortage of rental properties caused by landlords selling existing stock could be felt more acutely in certain parts of the country, with the capital worst affected.

If you’re a landlord selling up a property as a result of Section 24 and the increase in Stamp Duty, or you have a property in negative equity, contact Landlord Debt Advisory on 0161 222 4311, or go online to

Landlord Debt Advisory: Case Settlement Process

Following on from my previous post where I introduced CD Fairfield Capital as a company and our property debt resolutions brands, my next posts are case studies, real-life client situations we have dealt with and resolved.

Our Professional Landlord client approached us via our website for property debt solutions. For the sake of anonymity, we shall call him Bob. Bob had overextended his borrowing,  purchasing 35 properties since 2004, refinancing several times to raise deposit funds for further purchases and so on. The challenges he was facing were:

  • Interest rate rises (2x 0.25% Bank of England rate rises since we initially took instruction – all mortgages on variable rates
  • The financial impact of Section 24 taxation;
  • Bob’s age, 53 – all mortgages were interest-only with varying expiry dates (2019 – 2031); there were no repayment vehicles in place
  • Miscellaneous costs such as rental void periods, repairs and maintenance, management fees and charges

The Financials;

Portfolio Value:                                                                        £5.12m

Outstanding Debt:                                                                  £5.93m

Expected Shortfall/Negative Equity:                           £810,000

Total Debt Written Off:                                                        £696,000

Total Settlement:                                                                      £114,000

There was a combination of properties with equity and those in significant negative equity.

Bob told us the catalyst for contacting us was a combination of unplanned repair bills and the realisation that any further interest rate rises deemed the portfolio unprofitable as his cash-flow position was already precarious (up until that point it had always made a profit, albeit a rather modest one).

There was also a serious concern for the family home. This property is also mortgaged, owned jointly with Bob’s wife and has significant equity.

Once instructed, we completed a detailed review to include:

  • Recalling all lender documentation (15 lenders) to review security
  • Completing a detailed Statement of Affairs and reviewing all relevant client documentation
  • Portfolio Valuation – 35 individual reports

After concluding this work the following was clear:

  • As Bob had suspected the portfolio was untenable; despite there being some cash available, any combination of the challenges highlighted would quickly absorb this reserve.
  • Some lenders had the right to consolidate against the equity in other properties if sold.
  • This venture would become loss-making Q4 2018 or Q1 2019, and significantly so.

The recommendation was made that all properties were to be sold with the exception of the family home (this is not always the case). The Move With Us network was appointed to address the asset management element of the case (various agents and locations through England and Wales) to commence in line with each lender’s specification.

As the majority of the properties were tenanted, management contract extensions were agreed (where applicable) to ensure consistency with incoming rent, and the properties marketed.

While marketing was ongoing, we provided all lender representation for Bob. Further to this a bespoke shortfall settlement package was offered and accepted on a pari passu basis amongst the lenders (in this case an IVA); the highlights being:

  • Bob retained his family home; we negotiated new terms with his existing lender on a full repayment basis (had previously been interest-only)
  • Bob avoided bankruptcy
  • The equity from the properties sold above the loan value formed part of the settlement (£74,000)
  • Bob also added £40,000 – a combination of his own savings and gifted funds from family to this sum ie total settlement paid £114,000, total debt written off £696,000
  • Our total fee for this work was £37,500 (typical fee for addressing a single property and settlement is £4,000; average shortfall debt write-off is £70,000+)
  • The timeframe from instruction to conclusion circa 18 months

The above case type is common. We receive dozens of enquiries per week from Landlords with similar circumstances and varying portfolio sizes, geographical locations and levels of equity. It’s often the case that the Landlord has already spoken to the lender(s), the Accountant, a Financial Adviser, Solicitor and/or an Insolvency Practitioner unfamiliar with the intricacies of individual lender shortfall policy.

We are the ONLY company of our type in the UK with the expertise, regulation, lender relationships and track record to complete complex, multi-faceted cases of this type in a commercial and client-focused manner.