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For property owners who rent out to tenants - has anyone bought assurance loyers impaye?


cafe10
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Hello,

I've just bought an apartment in France which I will be renovating and then plan to rent out to a tenant. As I'll be paying a mortgage on the place, I'm hoping the monthly rent will be able to cover my monthly mortgage payment to the bank. For months when the place is not being rented out or when I can't find a renter, someone suggested to me to buy an assurance loyers impaye. Does any France property owner here have experience with buying this insurance? Do you recommend it? Is it useful and effective? About how much does it cost? Is there a specific assurance loyers impaye that you suggest (which company)?

Look forward to hearing from you and best regards,

Cafe 10
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Good luck. If there is an insurance, get it but make sure you understand the small print. If the defaulting tenant pays something towards the rent, I believe some insurances then do not pay out. Don't think any insurance will pay when the flat is just empty.

We let a flat in Paramé, just outside St Malo. The original tenant died and we paid an agent to find a new one, expecting them to do due diligence. As it turned out she was retired professional woman and also a drunk with mental health problems. I "broke into" the flat using a spare set of keys after she had not paid the rent for a few months, the floor was 30 cms deep in rubbish sacks. The Avocat we went to (at 300€ an hour) told me I was liable to prosecution as I had no right to enter my flat unless invited, despite the problem. It took FIVE years to get her out. We had to get several of the other tenants to sign as witnesses to the smell and degredation of the flat. Even though they had spoken to us and knew of the problem, they were very reluctant to put pen to paper ( very French). The Huissier knocked on the door to get evidence, but she refused him entry, as is her right. We had his bill the next day, but no evidence. Once we got into the winter period of course no court will evict. When we did get her before the Tribunal at St Malo, she interupted my opening statement. The Judge told her to be quiet and her assistant, who had her hand over her nose and mouth, told our tenant to go to the back of the court as the smell coming off her was so bad. Three months later we got a judgement evicting her from the flat (sent to the wrong address by the court!). By which time she had been hospitalised and had died. This was in 2017.

The tenant in France is much better protected than the owner. Luckily we did not have a mortgage on the flat, but we had to pay all the charges even when she was not paying the rent. If we had not taken action, the other tenants in the building had the right to take us to court.

I hope many other owners come on and tell you that our case is very rare (talking to others I don't belive it is) and you can get the perfect insurance. Just go in with your eyes and wallet wide open. As a rough guide, from the rent and charge she paid, minus the charges we had to pay plus social charges to the state, we got about half the rent. This does not include the maintenance of the buildiing (eg redoing the rendering, roof etc). We had the flat for 13 years, refloored it , new kitchen and bathroom half way through and when the tenant died sold the flat for about the same price we bought it for. It was 10 mins walk from the beach at Roterneuf Plauge Parame

Hey ho, what does not kill you makes you stronger.
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We rent out a house and are about to rent a second. We gave up with the agents as they were hopeless..advertised ourselves on Le bon Coin and vetted the tenants ourselves. The one we had did not meet the financial requirements but her parents were guarantors. If you have a guarantor then usually you can't get insurance. There is a government scheme that provides insurance for young renters on low incomes, that they can sign up to for free. Our first tenant moved on after a year and we have just re let to a nurse, who also didn't meet any of the criteria but again her parents were guarantors and she seemed very nice.. you can't really tell, but we had many enquiries and some were a no right from the first contact. We always check ours out on Facebook as well.. just to make sure they don't have any dodgy looking friends!
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[quote user="Lehaut"]Good luck. If there is an insurance, get it but make sure you understand the small print. If the defaulting tenant pays something towards the rent, I believe some insurances then do not pay out. Don't think any insurance will pay when the flat is just empty.

We let a flat in Paramé, just outside St Malo. The original tenant died and we paid an agent to find a new one, expecting them to do due diligence. ...

I hope many other owners come on and tell you that our case is very rare (talking to others I don't belive it is) and you can get the perfect insurance. Just go in with your eyes and wallet wide open. As a rough guide, from the rent and charge she paid, minus the charges we had to pay plus social charges to the state, we got about half the rent. This does not include the maintenance of the buildiing (eg redoing the rendering, roof etc). We had the flat for 13 years, refloored it , new kitchen and bathroom half way through and when the tenant died sold the flat for about the same price we bought it for. It was 10 mins walk from the beach at Roterneuf Plauge Parame

Hey ho, what does not kill you makes you stronger.[/quote]

Thanks so much for sharing your story Lehaut and the challenges with having a rental in France. It's quite a reality-check, and am glad to know before starting the rental process.
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[quote user="lindal1000"]We rent out a house and are about to rent a second. We gave up with the agents as they were hopeless..advertised ourselves on Le bon Coin and vetted the tenants ourselves. The one we had did not meet the financial requirements but her parents were guarantors. If you have a guarantor then usually you can't get insurance. There is a government scheme that provides insurance for young renters on low incomes, that they can sign up to for free. Our first tenant moved on after a year and we have just re let to a nurse, who also didn't meet any of the criteria but again her parents were guarantors and she seemed very nice.. you can't really tell, but we had many enquiries and some were a no right from the first contact. We always check ours out on Facebook as well.. just to make sure they don't have any dodgy looking friends![/quote]

Thanks Lindal, this is really good to know.
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