If a tenant fails to pay the rent, a payment arrangement is often agreed.
If this is not possible, or if the payment arrangement is not complied with, the landlord may initiate court proceedings to terminate the tenancy agreement and seek eviction of the property.
The court will grant the claim unless it considers that the breach is not sufficiently serious to justify termination and eviction.
When assessing the seriousness of the situation, the court will consider, among other things, the amount of the arrears. In general, arrears of three months’ rent or more are sufficient to justify termination of the tenancy agreement.
In addition to the level of arrears, the court will also examine the efforts made by the landlord. Since 1 January 2021, landlords are required, in the event of rent arrears, first to send a reminder to the tenant and to inform the tenant about the Municipal Debt Assistance Office, where they may seek help in managing their financial situation. If no payment or response follows, the landlord is even obliged to provide the municipality with the tenant’s details and the amount of the arrears. This obligation follows from Article 2 of the Decree on Municipal Debt Assistance.
If the landlord fails to comply with these obligations, there is a risk that the court will reject the claim for termination.
Please note: even if the tenancy agreement is terminated, the tenant remains liable for the outstanding rent (possibly increased by interest and legal costs).
Before initiating proceedings, it is advisable for the landlord to grant the tenant a final written period of 14 days to pay the full outstanding amount. This enables the landlord to recover extrajudicial collection costs from the tenant if court proceedings become necessary. You can also have such a 14-days letter drafted by one of our real estate lawyers to ensure compliance with the strict requirements imposed on the wording.
Do you have a question about rent arrears? Or do you have another legal question? Please feel free to contact us. We will be happy to assist you.
GMW lawyers is happy to assist you with specialist knowledge and experience in the field of tenancy law.
Please contact our team of experts for support.
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