Rent Management
Rent arrears – what landlords can do step by step
Rent arrears are one of the most stressful situations a landlord can face. Whether a tenant has missed one payment or has built up months of debt, knowing what you can do and in what order is essential. Act too slowly and the arrears mount up. Act without following the correct process and you risk damaging your own legal position. This article takes you through every step, from the first missed payment to recovering the property if it comes to that.
What counts as rent arrears?
Rent arrears arise the moment rent is not paid on the date it falls due under the tenancy agreement. Even a single missed payment puts the tenant in arrears. In practice, most landlords allow a short grace period before taking formal action, but this is a courtesy, not a legal obligation. The tenancy agreement sets the payment date, and anything after that is technically arrears.
One of the most effective ways to prepare for arrears before they happen is to put a policy in place. Our complete guide to rent guarantee insurance for landlords explains what cover to look for and how the claims process works.
The level of arrears matters legally because different enforcement routes become available at different thresholds. Two months of unpaid rent is the key trigger for mandatory possession under Ground 8. Understanding exactly how much is owed, and for how long, is the foundation of any action you take.
Step 1 – Contact the tenant promptly
As soon as rent is missed, make contact. A phone call, text, or email is appropriate at this stage. Keep the tone neutral and factual: the rent due on a specific date has not been received, and you want to understand whether there is a problem. Many missed payments are the result of banking errors, forgotten direct debits, or short-term financial difficulty that the tenant intends to resolve quickly.
Keep a written record of every contact attempt, including the date, method, and any response received. This record will be important if the matter proceeds to court.
If the tenant responds and explains a short-term difficulty, it may be worth agreeing a repayment plan in writing. This does not waive your right to pursue the arrears later, but it can resolve the situation without escalation and demonstrates that you have behaved reasonably, which courts view favourably.
Step 2 – Send a formal written reminder
If there is no response to initial contact, or if the arrears continue to grow, send a formal written reminder. This should be sent by email and, where possible, by post or hand delivery so you have clear evidence it was sent. The letter should state:
The exact amount owed and the dates for which it is owed.
A deadline for payment (typically 7 to 14 days).
That you will take further action if the arrears are not addressed by that date.
Do not threaten action you are not prepared to follow through on. If you state you will serve a notice by a certain date, do so. Inconsistency weakens your position.
Step 3 – Check whether the tenant is on Universal Credit
If your tenant is receiving Universal Credit (UC), their housing element may be paid directly to them rather than to you. If they are in arrears of at least two months, you may be able to apply for Alternative Payment Arrangements (APAs) through the Department for Work and Pensions, which would route the housing element directly to you as a Managed Payment to Landlord (MPTL).
This is not an automatic entitlement, but it is worth pursuing in parallel with other action if you believe UC is in payment. Contact the tenant's UC work coach or use the landlord portal to flag the arrears.
Step 4 – Serve a Section 8 notice
If the arrears persist and informal resolution has failed, the next step is to serve a formal Section 8 notice. This is a legal notice that tells the tenant you intend to apply to court for possession of the property. It must be served using the prescribed form (Form 3) and must specify the grounds you are relying on.
Under the Renters’ Rights Act 2026, Section 8 is the only route to possession for rent arrears. See our full guide to grounds for possession for a complete breakdown of all available grounds.
Ground 8 – mandatory possession for rent arrears
Ground 8 is a mandatory ground, meaning the court must grant possession if the conditions are met. To rely on Ground 8:
The tenant must owe at least two months' rent when the Section 8 notice is served.
The tenant must still owe at least two months' rent at the date of the court hearing.
For weekly tenancies, the equivalent threshold is eight weeks of arrears.
Because both conditions must be met, a tenant who makes a partial payment between the notice and the hearing to bring arrears below the two-month threshold can defeat a Ground 8 claim. It is therefore important to also include Grounds 10 and 11 in any notice.
Grounds 10 and 11 – discretionary grounds
Grounds 10 and 11 are discretionary, meaning the court may grant possession if it considers it reasonable to do so. They cover situations where arrears exist at the date of notice (Ground 10) and persistent delay in paying rent, even if no arrears are currently outstanding (Ground 11). Including these alongside Ground 8 gives you a stronger position if the tenant reduces the arrears before the hearing but continues a pattern of late payment.
How much notice must you give?
Under the Renters’ Rights Act, the notice period for rent arrears grounds is four weeks. You cannot apply to court until the notice period has expired and the date specified in the notice has passed. Make sure the notice is correctly completed and that the date gives at least the required notice. A defective notice can be challenged by the tenant and delay your case significantly.
For more on what ‘serving notice’ means and how to do it correctly, see our dictionary entry on serving notice.
Step 5 – Apply to court for a possession order
Once the Section 8 notice period has expired, you can apply to the county court for a possession order. You will need to complete the relevant court form (N5B for the accelerated procedure, or N5 for the standard route) and pay the court fee. At the time of writing, fees for possession claims in England are in the region of £391.
The court will list the case for a hearing unless it is dealt with on paper. At the hearing, the judge will consider the evidence you have submitted, any defence raised by the tenant, and whether it is appropriate to grant possession. For Ground 8 cases where the arrears threshold is clearly met, the court must grant possession.
The possession order will usually specify a date by which the tenant must leave, typically 14 to 28 days from the hearing. If the tenant fails to vacate, you move to the next step.
Step 6 – Enforce the possession order
If the tenant does not leave by the date in the possession order, you cannot remove them yourself. Self-help eviction is illegal and can result in a criminal prosecution and civil liability to the tenant regardless of their own conduct.
Instead, you must apply to the court to enforce the order. There are two routes:
County court bailiffs - you apply for a warrant of possession (Form N325), and bailiffs are appointed by the court. This is slower but cheaper.
High Court Enforcement Officers (HCEOs) - you can transfer the county court judgment to the High Court for faster enforcement. HCEOs can act more quickly than county court bailiffs, though the fees are higher.
Once enforcement is complete and the property is vacant, you can legally re-enter and begin the process of re-letting.
Recovering the outstanding debt
Gaining possession does not automatically recover the arrears. Once the tenant has left, you have a number of options for pursuing the debt itself.
Money claim - you can include a claim for the arrears in your possession application, or make a separate money claim. If successful, you obtain a county court judgment (CCJ) against the tenant, which you can then enforce through various means (attachment of earnings, charging order, etc.).
Deposit deduction - if the deposit held in the scheme covers part of the arrears, you can propose a deduction for unpaid rent. The tenant must agree, or the case goes to adjudication through the scheme. See our guide on how to protect and make deductions from a tenancy deposit.
Debt collection agency - for smaller sums where pursuing court action is not cost-effective, a debt collection agency may be instructed, though recovery is not guaranteed.
Can you use the deposit to cover rent arrears?
Yes, subject to the rules of the scheme holding the deposit. Unpaid rent is one of the legitimate reasons a landlord can make a deduction from a tenancy deposit. However, you must still follow the correct process, covering propose the deduction to the scheme, give the tenant the opportunity to dispute it, and if they do, the matter goes to adjudication.
You cannot simply retain the deposit without following this process. Doing so would put you in breach of the deposit protection rules and expose you to penalties.
Rent arrears under the Renters’ Rights Act 2026
The Renters’ Rights Act changes the possession landscape significantly. For a full overview of what landlords need to do once the Act commences, see our post-commencement landlord guide. The key changes that affect rent arrears cases are:
No more Section 21 - once the Act commences, you can no longer serve a no-fault notice to end a tenancy. Rent arrears cases will need to go through the Section 8 route exclusively, making it even more important to keep arrears records accurate and up to date.
Threshold for Ground 8 unchanged - the two-month arrears threshold for mandatory possession remains in place. However, the Renters’ Rights Act does introduce a new discretionary ground for persistent arrears, giving courts more flexibility where arrears have been cleared before the hearing.
Ombudsman and PRS database - landlords who are not registered with the Private Rented Sector (PRS) database may find their ability to enforce possession affected. Compliance with registration requirements will be checked in possession proceedings.
Can rent guarantee insurance protect against arrears?
Rent guarantee insurance (RGI) is a policy that pays out if a tenant falls into arrears and remains in place for a defined period. Policies vary considerably, but most cover rent payments up to a monthly cap for a period of between six and twelve months, and may also cover legal costs for possession proceedings.
RGI is not a substitute for tenant referencing; most policies require evidence that the tenant was properly referenced before the policy was taken out. Policies also typically have a waiting period before a claim can be made, often the first one to two months of arrears. Read the policy small print carefully before relying on it.
For buy-to-let landlords with mortgages, a period of unpaid rent can quickly create cash-flow pressure. RGI is worth considering as part of your overall risk management, particularly for higher-value properties or longer tenancies.
Alternatives to eviction
Eviction should always be a last resort. It is expensive, time-consuming, and leaves the property vacant while you find a new tenant. Before proceeding to court, consider:
Repayment plan - a written agreement for the tenant to pay the current rent plus an additional amount each month until the arrears are cleared. This only works if the tenant's difficulty is genuinely temporary and they are willing to engage.
Mediation - a neutral third party can sometimes help landlord and tenant reach an agreement that works for both sides, avoiding the cost and delay of court proceedings.
Mutual agreement to end the tenancy - if the tenant is struggling and wants to leave, a deed of surrender allows the tenancy to end by agreement. This is faster than possession proceedings and may be in everyone’s interest.
For more on late payment and the earlier stages of the process, see our guide on how to handle late rent payments.
The importance of keeping clear records
Throughout a rent arrears situation, your documentation is your most important asset. Courts, adjudicators, and insurance claims all depend on evidence. As a minimum, you should keep:
A complete payment history showing every payment received, the date it was received, and any shortfall.
Copies of every communication with the tenant, including texts, emails, and any letters sent.
Copies of any notice served, with evidence of service (signed receipt, tracked postage, email delivery confirmation).
Records of any repayment plan agreed, including whether it was adhered to.
The original tenancy agreement, showing the rent due date and amount.
Property management software that automatically logs payments and generates rent statements makes this significantly easier and produces records that are straightforward to use in court.
What to do when rent goes unpaid
Rent arrears require a prompt, measured, and well-documented response. Contact the tenant early, put everything in writing, explore whether Universal Credit arrangements can help, and only escalate to formal notice and court action when you have exhausted reasonable alternatives. When you do need to take legal action, follow the process precisely: a correctly served Section 8 notice, clear evidence of arrears, and a court application made at the right time.
The Renters’ Rights Act makes the Section 8 route more important than ever. Landlords who understand the grounds, keep meticulous records, and act promptly will be best placed to recover both their property and any money owed.
This article is intended for general informational purposes only and does not constitute legal, financial, or professional advice. Landlord and tenant law is subject to change, and the information in this article reflects the position at the time of writing. You should always seek independent legal or professional advice before taking any action in relation to your property or tenancy.
Author
August Team
The August editorial team lives and breathes rental property. They work closely with a panel of experienced landlords and industry partners across the UK, turning real-world portfolio and tenancy experience into clear, practical guidance for small landlords.
