In need of some extra cash? Then renting out a spare room and taking on a lodger could be financially beneficial (up to £7,500 a year tax-free). Whether looking to rent a room or planning to let your spare room, having some background knowledge will aid and assist the process.

What is a lodger agreement?

As a landlord it isn’t necessary to provide a lodger with a written contract but it is a good idea to do so. A lodger agreement is a contract that specifies terms that both the landlord and lodger must agree to, and gives you legal recourse should the terms of the agreement be broken. A landlord should supply a lodger agreement in advance so both parties can read and review, to ensure it is suitable for both parties.

What should be included in a lodger agreement?

  • Rent – how much rent needs to be paid, how often, and a specific date by which it should be paid. 
  • Type of stay – the agreement should define if the stay is for a fixed term for example, 6 or 12 months, or if it is a periodic tenancy, on a rolling week to week, or month to month basis.
  • Deposit – getting a deposit from a lodger is advisable as it will cover any damage or missed rent. The agreement should include what is covered for deposit deductions, and when the deposit will be returned.
  • Maintenance -a landlord is responsible for keeping the property safe and in a good state of repair. A lodger agreement may outline what maintenance the landlord is in charge of, and what, if any, the lodger must take care of. 
  • General house rules – this will ensure that both parties are in agreement with any specific house rules and regulations.
  • Eviction – the ‘type of stay’ details how long the contract period is for, although this does not necessarily have to be adhered to. A break clause allows the landlord to evict someone, ending the letting, as and if necessary. 

Do lodgers have any rights?

If the lodger has a fixed term contract, they can be evicted when the specified time period is complete or if the landlord has included a break clause. A lodging can also come to an end if both parties agree to it. 

A lodger on a periodic agreement, on the other hand, must be given reasonable notice, which is often around seven days. Periodic contracts are however typically short, often running weekly or monthly depending on when rent is paid. 

Also, lodgers should know that they don’t have the right to put locks on the doors. This is because, as a lodger, you must allow the homeowner access to your room. Naturally, it is advisable that landlords give their tenants a degree of privacy. 

Beneficial for both parties

A lodger agreement is beneficial to both landlord and lodger, and can if required, include tenancy specific agreements and clauses.

For expert legal advice in conveyancing, please don’t hesitate to contact us