3 Years Running: Buy-To-Let Legal Services Award
The Agreement 28 March 2011
If I were less than a model tenant and expecting a knock on the door, I might be about to be afraid. Very, very afraid.
If the agents of landlords had called in the services of Paul Shamplina, that is.
For Shamplina has, in the past 20 years, successfully evicted thousands of tenants. He is not someone to mess with. He won't swallow sob stories. And he increasingly has a media profile - in national newspapers and on television - that reinforces his fearsome hard-man reputation.
In truth, Shamplina is a down-to-earth, funny and genial Londoner, who is a delight to deal with.
But there's no getting away from it: he is scarily good at his job.
Shamplina, now 38, left school without any qualifications. During the recession of the mid-eighties he worked as an outdoor clerk for a law firm in Brighton when the interest rate was 16%. On the day he took his driving test, he memorably attended 22 mortgage repossessions.
He later moved to a London solicitors' office, where he learn the niceties - the that is the word - of tenant and landlord litigation. After that, he spent five years working independently as a baliff, private investigator and tracing agent.
But his real breakthrough came exactly ten years ago, when he joined forces with businessman Jonathan Chippeck to found Landlord Action. Although started in London, it now provides a national service.
To date, the company has carried out an astonishing 15,000 evictions - both challenging and undercutting traditional legal services.
"We launched Landlord Action in 1999 because we were frustrated with solicitors charging expensive hourly rates and making the procedure complex," says Shamplina.
"So we decided on setting up a company to help landlords and agents, giving free legal advice in straightforward language, with fixed fees."
Today, for example, the firm charges a set £850 (including VAT) for all stages of eviction, including serving notice, and all fees. A solicitor would typically charge anything from £1,300 to £4,000.
Yet the concept did not take of immediately, he admits. "It's been hard work to educate landlords, but after ten years we are now market leaders in our field. At the beginning there was only myself and co-director in the company, but now there are ten of us dealing in evictions and other trouble-shooting."
In our first year of business, ten years ago, the company did 250 evictions. Last year it handled 2,200 and by the end this year it expects to have done 2,800.
Why do things get this far, given that the court has ruled in favour of the landlord getting possession?
"They want to stay at the property as long as possible and not pay rent, and to generally leave the property a day before eviction. But half of cases we attend at court and obtain a possession will go to the eviction stage as the tenants refuse to leave by the date set by the judge."
He has handled some memorable cases, but the one that stands out most were the tenants who took the conservatory with them.
With unemployment currently rising, arrears are also becoming more problematic - 80% of all Landlord Action cases are because of rent arrears - and it is taking longer to get eviction proceedings through the courts.
Clearly, this is not good news for landlords and agents who would prefer to move rapidly on to the next (paying) tenancy, but just getting a date for the hearing is taking anywhere between six and ten weeks.
Shamplina is frustrated, but knows the cause is simple enough: "We are now in recession which means the courts are busier than ever, what with house repossessions and landlord and tenant hearings. Cases at city courts are generally taking longer to get a date, as they have more property within their jurisdiction."
The economic downturn is also causing problems.
"We have had many cases of cannabis factories in private rental accommodation, and as we have hit recession this is becoming more common. Most of the time, the criminal gangs involved are giving landlords false references, or paying six months rent up front to gain possession so they can grow their crop.
"We had one case recently where the police did a raid and over 600 plants were seized."
Cannabis factories are far from being the only problem in what can be a very unsavoury business. But the worst tenants are not the usual suspects.
"The worst tenants are generally professional bad tenants who go from one property to another, and quite simply have no intention of paying rent."
"We have been involved with over 20 cases where we have evicted the tenant on more than one occasion. I did a BBC1 programme called 'Inside Out' where we exposed a tenant we had evicted on two occasions for different landlords to whom the tenant owed rent.
"In the end he owed £130,000 in unpaid rent to all parties. It was a shocking case."
"Other horrendous cases we have had include murders, suicides, drug dealing, prostitution, purported terrorists and arson: the list goes on. It's not for the faint hearted."
A more recent challenge has been private tenants in private rental accommodation who are paid housing benefit direct, under housing allowance rules. Shamplina describes LHA as a major problem and says many tenants are not passing their money on to the landlord.
"Today, a landlord told us a tenant is withholding rent and sending it to Kosovo to fund the building of a house," says Shamplina. It is almost you-couldn't-make-it-up territory.
But of course there are not just rogue tenants, but rogue landlords too.
Typically, the instruct Landlord Action to serve a notice for rent arrears on the tenant, but fail to disclose that they have done no repairs to the property, and the tenant has no hot water - or the landlord has been harassing or threatening the tenant because of non-payment of arrears.
Disrepair is one of the circumstances in which landlords cannot evict tenants.
Are there also Rogue agents? "Yes, this is becoming a huge problem. We have exposed rogue agents through the press. We get many complaints from landlords that the agents have withheld the rent and not passed it on. We have a debt recovery department and we have done many cases of pursuing these rogue agents for landlords' rent. Or we get complaints that landlords instructed agents to do a full management, but the agent has only given a let-only service."
"Generally I think more landlords should use agents. However, I see a lot of landlords who instruct amateur agents getting into a lot of bother, because the agents haven't referenced properly, or failed to comply with laws, which causes problems down the line.
I always recommend that landlords should make sure that they use an agent affiliated to the ARLA or the NAEA, do due diligence on the company and also obtain landlords' references.
"I think proposed new legislation for compulsory regulation of letting and managing agents can only be good for the industry and stop rogue agents giving the good agents a bad name."
Does he also think landlords should be regulated - as also proposed - via a compulsory register?
"I think the industry may be cleaned up to a certain extent. I do believe there will be many landlords who will not opt into the scheme and it may be hard to govern. I also think the idea behind bringing it in might be to hit landlords with tax, as they can be deemed as an easy target by the Government."
Shamplina is also concerned about the many estate agents who have recently expanded into lettings without realising the complexities of the market and the fact it is all about service levels.
"Obviously estate agents have had to subsidise their income by doing lettings, because they were struggling to sell properties," says Shamplina.
"Some have been fine, because they had previous experience in lettings, but some estate agents have no experience and need to be better trained. We have had some complaints about the service offered.
Landlord action does not confine itself purely to evictions. It also acts for agents and landlords in other ways, if they need to recover money. For example, it will recover agents' fees that landlords have not paid.
The company also recently warned against property 'discount' clubs that charge up-front fees to secure properties apparently at a discount.
Unfortunately for the investors, valuations showed that the proposed properties were not being sold at any kind of discount, but the clubs have refused to refund advances.
The whole subject is one that Shamplina feels strongly about. "Many investors were ripped off by property investment companies, paying large sums just to go on seminars and purchasing property with false discounts on off-plan city centres and false promises of good yields."
"We are acting for some of these buy-to-let investors in evicting tenants who are not paying the rents, while the landlords are behind with their mortgages."
"We exposed one guy in the Mail on Sunday who we have nine cases against, who was taking deposits from investors for 'Below Market Discounts' on properties, but no deals were actually completed."
"That industry needs regulating and I am in the process, with others, of setting up a property investors' association for companies to join, with a code of conduct."
In his tenth year of trading, Shamplina is looking forward to making a second decade of business. The plan is simple: to become a one-stop shop for landlords and their agents who are experiencing any kind of problems with tenants.
But does this hard-man have a heart? Oh yes. "When we know it's a genuine case of hardship, and the tenant is in trouble through no fault of their own, and not because they are purposefully not paying the landlord.
He is also concerned that tenants are evicted because the landlord has gone bust. Fair enough, he thinks, if it is clear that the tenants have not been paying rent, and therefore contributing to the landlord's difficulties. But less fair if the tenants have been paying rent.
"If the tenants have been paying the rent, then they only get notified of eviction when the bailiffs are setting the eviction date for the bank/building society, because the landlord has not being paid his mortgage. Clearly this is unfair on the tenants.
He also has some advice for both landlords and agents.
He urges no short cuts on tenant referencing, and says agents should both make and spend time on this. Landlords should not be rushed into a let simply because they are worried about a void period. Communicating with the tenant is also important, as is dealing promptly with maintenance issues.
"Also, make sure you offer good value for money and a proper full management service and report regularly to your landlords," he adds.
"Remember, a landlord's recommendation is the best form of business. Make sure you pay rents on time. It's the biggest problem that landlords complain about."
He should know: a landlord himself, he says that if he had not founded Landlord Action, he would have carried on in the legal field and focused on harder on building his own rental portfolio.
And is he a good landlord? "Yes, and thankfully, I have no bad tenants."
Landlord action was set up by landlords for landlords with problem tenants. That is, tenants who are in rent arrears or break some other part of a tenancy agreement. Landlord & tenant law is a specialist area and we found solicitor charges were too much and too vague. When you have a bad tenant you want to evict them fast. Any landlord would want a bad tenant out. they want advice and help with the law. And that's what we do. We are experts in this area and unlike solicitors, we only act for landlords, never tenants. And we'll help recover the outstanding rent. Our free advice line is open to all landlords and we have carried out thousands of evictions.