Tips for property owners renting in Spain

Chapter 1: A temporary reduction due to financial problems

For long terms rentals (doesn't apply to short term or holiday rentals)

Your tenant has started to delay paying the rent, citing financial problems, and is asking for some flexibility for a period of time. See how to act.

Temporary. Your tenant informs you that he is struggling because he has lost one of his sources of income, and tells you that he is working on it and will be able to catch up soon. Make a note.  You consider him to be a good tenant and are willing to make things easier for him in these difficult times. Leave everything well tied up and avoid problems.

Viable. Ask him how long he thinks this situation will last and what he needs (payment in the last days of the month, a temporary reduction in the rent...). This way you will be able to better assess whether it is realistic to give it a chance by keeping the contract. 

Note.  Evaluate the situation as if you were a new tenant and, if you objectively consider that you will be able to catch up, sign an agreement to the rental contract making clear the agreements reached, especially:

  • The period during which the tenant will pay less (stating the exact amount they will pay).
  • And when and how the difference will be paid back (for example, in a lump sum at the end of that period or pro rata over the following months).

In writing. While verbal agreements are valid, they are much more difficult to prove. Therefore, even for a short period of time, avoid problems by signing this annex to the contract. 

Attention!  Sometimes the fact that the landlord has accepted without opposition partial payments (over long periods, e.g. three years) has been interpreted as the landlord tacitly agreeing to novate the contract and lower the rent (so that he would no longer be entitled to claim the difference, but would have to keep this rent until the end of the contract). Therefore, be cautious and put everything in writing.

Default. If during this period your tenant does not comply, either because he stops paying or because he pays less, or even if at the end of the term he pays the full rent again but does not catch up on the debt, you can claim the debt and, in addition, the eviction for non-compliance with the contract. Note.  Having everything in writing will make it much easier for you to prove the agreements reached and the concepts that have not been fulfilled (rent or accumulated debt).

"If you believe that your tenant will be able to get back on his feet and pay off his debt, agree on a temporary reduction that is well-defined and in writing in an annex to the rental contract".

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