Can I Do a Mutual Exchange With Rent Arrears?

You've found the right swap, but there's a problem: you're behind on your rent. Maybe it's a few weeks after a benefit delay, or maybe it's built up over a hard year. Either way, you're wondering if it means the end of your move.

The good news is that rent arrears don't automatically stop a mutual exchange. But they do usually need sorting before you move. Here's how it works.

Arrears On Their Own Aren't A Reason To Refuse

In England, council tenants with a secure tenancy can only be refused a swap for certain reasons set out in the Housing Act 1985. Most housing associations follow very similar rules. Simply owing rent isn't one of those reasons.

What your landlord can do is agree to the swap on condition that you clear the arrears first. In practice, that means the swap goes ahead once the balance is paid, and not before.

When Arrears Can Stop A Swap

Things are different if your landlord has already taken action over the arrears. They can refuse the swap if:

• there's a possession order against you, or
• they've started possession proceedings, or served a notice saying they intend to

The same applies to the household you're swapping with. If they have a possession order, your swap can be refused even if your own rent account is clear.

If you've had a letter about court action, don't ignore it. Get advice straight away, as dealing with it early gives you the most options.

Your Arrears Don't Disappear When You Move

It's a common hope, but the debt stays with you. If you move without clearing it, it becomes a former tenant debt, and your old landlord can still chase you for it. It can also show up when you apply for housing in future.

The other side of this is good news: you don't take on the other tenant's arrears. Their debt stays with them.

How To Get Your Swap Back On Track

Talk To Your Landlord Early

Ask for the exact balance and what they need from you before they'll approve the swap. Some landlords want the full amount cleared. Others may accept a payment plan you've kept to for a while. Getting this in writing before you start viewing homes saves heartache later.

Check You're Getting All The Help You're Due

• Universal Credit or Housing Benefit: make sure your claim is up to date and covers the right amount of rent.
• Discretionary Housing Payment: your council may help with a shortfall. Some councils will consider helping clear arrears when a move to a smaller or cheaper home will make your rent easier to manage.
• Hardship funds: some housing associations have their own funds for tenants in difficulty.

Get Free Debt Advice

Free, confidential help is available from Citizens Advice, StepChange and National Debtline. They can help you work out a budget, deal with other debts and talk to your landlord.

Be Upfront With The Other Household

If clearing your arrears will take a few weeks, tell the people you're swapping with. A swap only works if both households are ready, and honesty early on keeps their trust.

A Swap Can Help With Money Worries

For some tenants, a mutual exchange is part of the answer. If you're paying for a spare bedroom you don't use, moving to a smaller home can cut your rent and remove the housing benefit reduction for under-occupying. A cheaper home, or one closer to work or family, can make the monthly budget easier too.

Wales And Scotland

The rules are similar but not identical. In Wales, swaps come under the Renting Homes (Wales) Act 2016. In Scotland, the Housing (Scotland) Act 2001 applies. In both, arrears are often taken into account when a landlord decides. Shelter Cymru and Shelter Scotland can advise on your situation.

The Short Answer

Yes, you can usually do a mutual exchange with rent arrears. But expect to clear them before you move, and talk to your landlord early. If there's court action over your arrears, get advice first, because that can stop the swap altogether.

To understand the full picture, read Can My Landlord Refuse a Mutual Exchange? and our step-by-step guide to mutual exchange. When you're ready, list your home free and start looking for your swap.