When landlords partner with a letting agent under a Fully Managed or Rent Collection service, they sometimes question why management fees remain payable during periods of rent arrears. It’s a fair question — but the answer lies in understanding what the fee actually covers.

The management fee is not just a charge for collecting rent. It’s a professional service fee that reflects the agent’s ongoing responsibility for managing the tenancy, ensuring legal compliance, and maintaining the property and tenant relationship — all of which continue regardless of whether the rent is paid on time.

Ongoing Responsibilities in Property Management

Managing a tenancy involves far more than simply collecting rent. In fact, when a tenant falls into arrears, the workload for the agent typically increases — not decreases. The letting fee reflects the time, expertise, and legal diligence required to keep the tenancy on track, protect the landlord’s rights, and stay compliant with the law.

Letting agents must operate within the framework of over 170 separate pieces of legislation. These laws apply regardless of whether rent has been paid — and failing to meet even one requirement can compromise a landlord’s ability to regain possession or defend against a claim.

Here are just some of the ongoing tasks a letting agent handles during the tenancy — regardless of arrears:

Chasing Arrears and Managing Escalation

When a tenant falls behind on rent, the agent steps in immediately. They begin chasing payment with polite but firm reminders, make direct contact with the tenant, liaise with guarantors (if applicable), and keep detailed records. If the arrears persist, the agent serves notices, advises on legal routes, and may assist with court proceedings. This is labour-intensive, time-sensitive work that directly protects the landlord’s financial position.

Legal Compliance

The agent continues to ensure that the property remains legally compliant at all times — which is vital if possession proceedings ever become necessary. If a landlord hasn’t met even one requirement (like providing an EPC, gas safety certificate, or the “How to Rent” guide), they may lose the right to evict the tenant. This is why letting agents stay across a huge body of regulation, including:

• Housing Act 1988 & 2004
• Landlord and Tenant Act 1985
• Deregulation Act 2015
• Tenant Fees Act 2019
• Consumer Protection from Unfair Trading Regs 2008
• Gas Safety (Installation and Use) Regulations 1998
• Electrical Safety Standards in the PRS Regulations 2020
• Right to Rent (Immigration Act 2014)
• Homes (Fitness for Human Habitation) Act 2018
• Fire Safety Order 2005 and Fire Safety Act 2021

These laws are active at all times — not just when the tenant is paying.

Tenant Management & Property Oversight

Communication with the tenant doesn’t stop during arrears. In fact, it often increases. Agents continue to handle repair requests, safety concerns, and compliance checks (especially in HMOs where regular inspections and alarm testing are legally required). They also monitor how the tenant is treating the property — crucial if legal action becomes necessary later.

Protecting the Landlord’s Position

During arrears, agents are often laying the groundwork for enforcement — collecting written evidence, maintaining compliant notices, and advising the landlord on when to act. This proactive management protects the landlord’s rights and increases the chances of recovering rent or regaining possession quickly.

In short, letting agents are not being paid for rent collected — they’re being paid for professional management of the tenancy. That work doesn’t pause when rent is missed. If anything, it ramps up — and becomes even more valuable to the landlord.

Conclusion

It’s easy to see why landlords might question paying fees when rent isn’t coming in — but managing a tenancy is about far more than simply collecting rent. In fact, during periods of arrears, the agent’s role becomes even more critical. From chasing payments and serving notices to ensuring legal compliance and protecting the landlord’s position, the workload increases — not decreases.

Letting agents carry responsibilities that don’t pause when rent is missed. Their actions during arrears often make the difference between a smooth resolution and a costly legal battle. Every inspection, conversation, and compliance check matters — and it all continues behind the scenes, even when the rent doesn’t.

If you’re looking for reliable, professional HMO management, we’d be happy to help — get in touch to find out how we can support you.