My tenant has been made bankrupt: what can a landlord do?
If a tenant is made bankrupt, it can leave a landlord in a difficult position, particularly where the rent is an important source of income.
But bankruptcy does not automatically mean the tenancy ends or that the tenant has to leave. Here, Jenna Ansell answers some of the main questions landlords may have. This article relates to residential tenancies in England. Different rules apply in Wales, Scotland and Northern Ireland.
Does bankruptcy automatically end the tenancy?
No.
A tenant's bankruptcy does not usually bring the tenancy to an end. If the tenancy continues, the tenant can remain in the property and is still responsible for paying the ongoing rent.
Since 1 May 2026, most private residential tenancies in England have become assured periodic tenancies and, subject to limited transitional provisions, landlords can no longer rely on section 21 'no fault' eviction. A landlord who wants the property back will normally need to rely on one of the legal grounds for possession.
Can I evict the tenant because they are bankrupt?
Bankruptcy itself does not automatically give a landlord the right to possession.
The tenancy agreement should be checked to see whether bankruptcy is covered by its terms, but in most cases the more important issue will be whether the tenant has fallen behind with the rent.
A landlord cannot simply ask the tenant to leave, change the locks or take the property back without following the correct legal process.
What if the tenant stops paying the rent?
Rent arrears can give a landlord grounds to seek possession.
Significant rent arrears can provide a mandatory ground for possession, provided the statutory requirements are satisfied both when notice is served and at the date of the hearing.There are also other grounds where some rent is unpaid or the tenant has regularly paid late. These are discretionary, which means the court will decide whether it is reasonable to make a possession order.
What happens to rent arrears from before the bankruptcy?
Rent already owed when the tenant is made bankrupt will generally form part of the bankruptcy.
The landlord will normally need to submit a claim in the bankruptcy for those arrears rather than pursuing the tenant directly for payment.
Although a landlord's ability to recover historic arrears may be affected by the tenant's bankruptcy, those arrears can still be relevant if the landlord seeks possession of the property. In other words, the landlord's ability to recover the money and their ability to recover the property are separate issues.
What about rent due after the bankruptcy?
The tenant remains responsible for rent that falls due while they continue living in the property.
It is therefore sensible for landlords to keep a clear record showing what was owed before the bankruptcy and what has become due afterwards.
What if the tenant lives with a spouse or partner?
This can make a difference.
If the spouse or partner is also named as a joint tenant, the tenancy does not simply end because the other tenant has become bankrupt. Depending on the tenancy terms, the joint tenant may also remain responsible for the rent.
Even where the bankrupt tenant is the only person named on the tenancy, a spouse or civil partner living at the property may have rights which need to be considered.
Landlords should therefore establish exactly who is named on the tenancy and who is living at the property before starting possession proceedings.
Can we simply agree that the tenant will leave?
Yes, and this may sometimes be the most straightforward solution.
If the tenant accepts that they can no longer afford the rent, the landlord and tenant may be able to agree that the tenancy will end and the property will be returned.
Any agreement should be properly documented so that there is no uncertainty over when the tenancy ends, when the keys are returned or what happens to any outstanding rent and deposit.
What should a landlord do first?
If a tenant says they have been made bankrupt, the landlord should establish the facts before taking action.
It is worth checking:
- who is named on the tenancy;
- who else lives at the property;
- how much rent is outstanding;
- whether the arrears arose before or after the bankruptcy;
- whether there is a guarantor; and
- whether the tenant is likely to be able to afford the rent going forward.
Bankruptcy does not automatically end a tenancy, but it also does not prevent a landlord from seeking possession where the legal grounds are met.
The important thing is to follow the correct process and consider both the tenant's bankruptcy and the landlord and tenant rules before deciding what to do next.
With offices in London, Norwich and Portsmouth, we support individuals facing bankruptcy across England and Wales. To speak to one of our team or arrange an appointment, please email info@isadoregoldman.com.