Securing tenant's property for nonpayment of rent

Question from Adam updated on 11th June 2010:

One of my tenants has not paid rent from 5 months ago for the period of 8 weeks outstanding. This is due to her being made redundant and then finding a new job thankfully. We have been more than reasonable with her, giving her grace in time to pay back and also to set up a payment to drip feed us back. But still nothing yet. She is paying us currently but alway's late. Am I able to lodge security against her property (PPSR) ie vehicle for the outstanding rent just in case she decides to pack up and leave ?

Our expert Jeff Montgomery responded:

The Personal Property Securities Register (PPSR) is administered by the Ministry Of Economic Development (MED). You can only register a security interest on the PPSR if there is a valid written security agreement between the debtor and the secured party (creditor) which creates a security interest in the personal property (i.e. the tenant would need to agree for their vehicle to be lodged on the PPSR as security). In any case, a debt for rent arrears would still need to be established through the Tenancy Tribunal prior to any enforcement action. The PPSR contact details are www.ppsr.govt.nz, or 0508 777 746.

Where a tenant is more than 21 days in arrears, you can make an application to the Tenancy Tribunal. The first step in this process is mediation. If an agreement is reached at mediation and a payment plan is established, this will be drawn up as a mediators order and sealed. This formalises the agreement which can be enforced if not complied with. If an agreement is not reached at mediation it can be referred to the Tenancy Tribunal to have the matter resolved. Information on enforcement of Tenancy Tribunal orders can be viewed at http://www.dbh.govt.nz/enforcing-sealed-order.

Landlord’s can require a tenant to pay a bond of up to four weeks rent at the beginning of the tenancy. This is lodged with the Department of Building and Housing, and can be used to cover any costs owed by the tenant at the end of the tenancy. To discuss your situation further, or for information about applying to the Tenancy Tribunal, you can visit the Department of Building and Housing website (www.dbh.govt.nz), or call 0800 TENANCY (0800 836 262).

The Department of Building and Housing provides information and guidance on building law and compliance, services including weathertight homes, and advice for tenants and landlords.

 

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