PLEASE READ BEFORE POSTING

Hello Forumites! In order to help keep the Forum a useful, safe and friendly place for our users, discussions around non-MoneySaving matters are not permitted per the Forum rules. While we understand that mentioning house prices may sometimes be relevant to a user's specific MoneySaving situation, we ask that you please avoid veering into broad, general debates about the market, the economy and politics, as these can unfortunately lead to abusive or hateful behaviour. Threads that are found to have derailed into wider discussions may be removed. Users who repeatedly disregard this may have their Forum account banned. Please also avoid posting personally identifiable information, including links to your own online property listing which may reveal your address. Thank you for your understanding.

Paying 6 Months Rent In Advance - Housing Benefit??

Hello, i've had lots of help regarding previous problems but i have had enough of my landlord refusing to get work done to my rented house so i desperately want to move out. I've got my eye a few properties but none of the landlords will touch me with a barge pole since i don't have a guarantor and i receive housing benefit (am single mum to a baby at the moment but will be going back to work within a year).

I have no one that i can persuade to be a guarantor but my father has offered to lend me 6 months rent in advance to try and sway a new landlord. The condition of it is that i pay it back as soon as possible. When i return to work i will be in no position to pay twice as much rent each month so the only way to do it would be to continue claiming HB when i move in (which i would be doing anyway if i could find a LL to accept me without a guarantor!!) and then give my father the rent money each month.

Is this allowed?? Would i need to inform the council about this or should i just not mention it? And would my tenancy agreement state that i've paid 6 months up front (in which case im assuming they wouldn't give me HB?)

Hopefully someone will know!! Thanks in advance :)
«1

Comments

  • The entitlement to housing benefit (or LHA: Local Housing Allowance) is based on your declared income, not on loans from family or any savings you might have up to the maximum limit. In your case I don't see how a loan from your father could affect your entitlement to LHA even if there was mention of it in the tenancy agreement. but you must bear in mind what your local authority's maximum LHA might be for someone in your circumstances. I suggest you do this so that you can ensure that you don't take on a property with a rent in excess of the allowance or you'll have to make up the difference yourself. I'm not certain whether with a baby you can claim the rent-level for a one or two-bed property so you should most definitely check that.
  • Morglin
    Morglin Posts: 15,916
    Name Dropper First Post Photogenic First Anniversary
    Forumite
    I don't think you will have a problem with this, as the money your father is lending you is basically a guarantee/deposit to secure a tenancy, and LHA/HB is paid on the basis of weekly income, not loans etc.,

    However, I would advise the Housing Benefits department what you are doing, so that there is no future query/problem.

    Some councils have schemes where they guarantee the rent etc., to private landlords, and hold lists of LL's who are happy to accept tenants on LHA - so it might be worth asking about this, as well.

    You can check here what you would be entitled to in respect of LHA and type of accomodation:

    https://lha-direct.voa.gov.uk/Secure/LHARateSearch.aspx?SearchType=PostCode

    Lin :)
    You can tell a lot about a woman by her hands..........for instance, if they are placed around your throat, she's probably slightly upset. ;)
  • tbs624
    tbs624 Posts: 10,816 Forumite
    If your father is willing to loan you the money upfront, have you already checked whether he could possibly act as your guarantor?
  • Maybe Dad isn't in a position to help any more than he has offered to already? Six months rent as a loan is very generous but a future, possibly unlimited liability might not be acceptable. Goodness knows we've seen enough horror-stories on here from people who have found out the hard way about signing up to such agreements. It's not one I'd take lightly, even for someone I trusted implicitly.
  • Does anyone know if the information given to petridish proved to be correct? I ask as I find myself in a very similar position (6 months rent paid up front, borrowed from Father-in-law, just been made redundant and now need to claim HB for me and my family). Hopefully Morglin's got it right in that the borrowed money was essentially a large deposit...it still needs to be paid back to FIL.

    Thanks in advance. :-)
  • HappyMJ
    HappyMJ Posts: 21,115
    Combo Breaker First Post
    Forumite
    Does anyone know if the information given to petridish proved to be correct? I ask as I find myself in a very similar position (6 months rent paid up front, borrowed from Father-in-law, just been made redundant and now need to claim HB for me and my family). Hopefully Morglin's got it right in that the borrowed money was essentially a large deposit...it still needs to be paid back to FIL.

    Thanks in advance. :-)
    You should be able to claim housing benefit.
    :footie:
    :p Regular savers earn 6% interest (HSBC, First Direct, M&S) :p Loans cost 2.9% per year (Nationwide) = FREE money. :p
  • BitterAndTwisted
    BitterAndTwisted Posts: 22,492
    First Post Combo Breaker
    Forumite
    You should be able to claim LHA but the amount your Local Authority is prepared to pay is dependent on your particular circumstances. If you're single and under 35 years of age it will be a whole world away from what it might be if you are a couple with seven kids.

    I suggest you check your Local Authority's website and see what they currently pay because they may not pay all of your current rent and then you will have to make up the difference from whatever income you do have. You entitlement is based on their decision about your "need" rather than the actual rent, so a couple with two kids would need a property with two bedrooms but that might not help you much if the property has four, except if it was remarkably lower than the average rent in your area.

    You will be entitled to something and it's rarely back-dated so get on with your application tout ruddy suite.
  • You should be able to claim LHA but the amount your Local Authority is prepared to pay is dependent on your particular circumstances. If you're single and under 35 years of age it will be a whole world away from what it might be if you are a couple with seven kids.

    I suggest you check your Local Authority's website and see what they currently pay because they may not pay all of your current rent and then you will have to make up the difference from whatever income you do have. You entitlement is based on their decision about your "need" rather than the actual rent, so a couple with two kids would need a property with two bedrooms but that might not help you much if the property has four, except if it was remarkably lower than the average rent in your area.

    You will be entitled to something and it's rarely back-dated so get on with your application tout ruddy suite.

    Thanks again BAT. I'm married with 2 kids living in a modest (2 bedroomed) bungalow and the claim is being filled in as we speak! :) I was made redundant on the 30th April and the claim starts from the 1st May as that's when the LA were first contacted. We have no savings, but can make up the difference between the rent and our LHA (temporarily) from selling some belongings on eBay, getting rid of a car etc. The shortfall is about £200 a month, so that can't last forever...but then I hope my position won't either! :(

    I just wanted to be sure that the LA understands what my FIL did through lending money for the first 6 months up front was in no way a 'gift'...it's not! The reason we had to ask this was precisely as you said above...I'd been made redundant previously and was entering a new job with uncertain prospects and he did not want the liability of being a guarantor for an indefinite period, which was fair enough. Unfortunately, we find ourselves in the same situation - yet again - but with this added complication of not actually paying our landlady rent, but - in essence - my FIL. Really hope the LA views it as such or, well, I don't know what will happen actually. :(
  • BitterAndTwisted
    BitterAndTwisted Posts: 22,492
    First Post Combo Breaker
    Forumite
    You might not, but I do. The loan from your FIL to pay your rent in advance is irrelevant. Just get that claim in asap and I wish you the very best of luck with your job-searching.
  • StarvinMarvin
    StarvinMarvin Posts: 6 Forumite
    edited 9 May 2012 at 8:14PM
    You might not, but I do. The loan from your FIL to pay your rent in advance is irrelevant. Just get that claim in asap and I wish you the very best of luck with your job-searching.

    Thank you! :)
This discussion has been closed.
Meet your Ambassadors

Categories

  • All Categories
  • 342.5K Banking & Borrowing
  • 249.9K Reduce Debt & Boost Income
  • 449.4K Spending & Discounts
  • 234.6K Work, Benefits & Business
  • 607.1K Mortgages, Homes & Bills
  • 172.8K Life & Family
  • 247.4K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 15.8K Discuss & Feedback
  • 15.1K Coronavirus Support Boards