Tenant constantly late in paying rent

Biciitalia

Hi - I have had a tenant in my house since Jun and for the last 2 months the tenant has paid late.

This month the tenant has submitted a letter to the LA stating that her HB date has changed and she cannot meet the date stipulated in the contract (17th each month) and will not pay until the 6th October at the earliest resulting in a 3 week arrears. Whilst it is a good sign that the tenant has contacted the LA alarm bells are starting to ring (plus my neighbour has informed me that someone else is living at the house).

The question is what is the best course of action to take? Yes the tenant is looking after the house ok but the late payments are causing me a lot of grief as I am currently working abroad and could do without having to chase the LA (who also stated that the tenant worked - since found out that it is cash in hand undeclared work). I know in some respects that I am lucky to be getting rent paid I am not running a charity and the tenant is breaking the contract by paying late each month. The tenant is 3 months into a 6 month contract and even the LA is advising to terminate the contract - is it true that it is more difficult to evict when past a 6 month contract onto a rolling 1 month?

Cheers

Biciitalia

socrates

Biciitalia wrote: »

Hi - I have had a tenant in my house since Jun and for the last 2 months the tenant has paid late.

This month the tenant has submitted a letter to the LA stating that her HB date has changed and she cannot meet the date stipulated in the contract (17th each month) and will not pay until the 6th October at the earliest resulting in a 3 week arrears. Whilst it is a good sign that the tenant has contacted the LA alarm bells are starting to ring (plus my neighbour has informed me that someone else is living at the house).

The question is what is the best course of action to take? Yes the tenant is looking after the house ok but the late payments are causing me a lot of grief as I am currently working abroad and could do without having to chase the LA (who also stated that the tenant worked - since found out that it is cash in hand undeclared work). I know in some respects that I am lucky to be getting rent paid I am not running a charity and the tenant is breaking the contract by paying late each month. The tenant is 3 months into a 6 month contract and even the LA is advising to terminate the contract - is it true that it is more difficult to evict when past a 6 month contract onto a rolling 1 month?

Cheers

Biciitalia

Firstly - make me a promise - never ever use an agent to get you a tenant that is claiming benefits again - you can get the same tenants (and obviously better) directly from your Local Housing Dept. Plus they will give a bond to guarantee their deposit.

Secondly your tenant is talking rubbish - LHA can be paid 2 weeks in arrears.

What you need to do is visit your HB Office and inform them that you feel that your tenant is likely to be building up large arrears.

Ask them to suspend her claim for the moment until she clears her arrears. Do this in person and in writing - they will provide you with a sheet of paper to make a statement they will countersign it and give you a copy.

They will call your tenant in to explain why she is delaying payments - if you are lucky she will ignore them and you can try (very hard) to get them to pay you directly.

However I have a feeling once her income stream dries up she will be hot footing it to their office.

She will not leave and will try to wait for you to evict her so she can get re-housed by the Council - the Council will also advise her to stay put. It will cost you £hundreds + to get her out.

Make sure all your communications are in writing and try to deal with one Benefits Officer.

Another question - how did the fee work that you paid the agent?

Is there a deposit?

Is it protected?

I have a few other questions but lets deal with these first....


I have just noticed you are working abroad - you need to authorise someone you trust to deal with the Local Authority - ask them how you do this over the phone.

silvercar

Phone the council, tell them that the tenant is claiming HB/ LHA but is in arrears already. Follow it up in writing.

I did this and within a week the council were paying me direct. That still leaves you the arrears to sort but does give you the security of having the rent paid directly into your bank account in a timely manner (though it could well be 4 weekly or 2 weekly rather than monthly).

socrates

silvercar wrote: »

Phone the council, tell them that the tenant is claiming HB/ LHA but is in arrears already. Follow it up in writing.

I did this and within a week the council were paying me direct. That still leaves you the arrears to sort but does give you the security of having the rent paid directly into your bank account in a timely manner (though it could well be 4 weekly or 2 weekly rather than monthly).

silvercar - its definitely the way forward BUT getting them to pay you directly is not a foregone conclusion and in my experience very unlikely after only a few weeks arrears - it seems the Benefits Officers in your area are in the minority - in that they use common sense.

clutton_2

i would get rid of this tenant as fast as i could - she is lieing to you, committing benefit fraud by working, she has someone living with her and she is not paying the rent properly - if the benefit goes directly to OP and the council find that she has been working illegally they will claw back all the rent from OP

Jowo_2

The OP is unlikely to be able to secure possession of the property in the first six months for anything other than being 2 months in arrears at the time of serving an S8 notice and the time of the court case. For arrears of that magnitude, the council must then start paying the landlord directly. Other grounds, such as late payment of rent, are discretionay and a judge probably won't make the judgement in the landlord's favour.

Therefore, if there are no substantial arrears, the OP should ensure that an S21 is issued to give the tenant 2 months notice (this may have been issued at the start of the tenancy by the agent) to expire at the end of the fixed term.

Then they will discover one of the main reasons why some landlords are averse to HB/LHA tenants - councils gatekeeping policies - whereby if the tenant asks them to be rehoused, they will order the tenant to stay in the property until the landlord has gained a court order for possession which lengthens the eviction process considerably compared to other tenants who are more likely to just find themselves onward accommodation when their tenancy ends.

As for the benefit fraud, there is a benefit fraud hotline, though many reports to it are invariable incorrect or malicious, though obviously some have substance and the recipient is prosecuted.

Jowo_2

I believe there is some kind of interim housing benefit payment that must be paid to a tenant after 2 weeks if their claim has not yet been processed but all the correct paperwork has been submitted by the claimant. The claimant has to apply for it, it isnt routinely offered.

Also, most landlords get the tenant to set up a standing order to pay the rent each month to prevent having to chase rent on a monthly basis. Get your agent to get the tenant to complete one and return it so the agent knows it has been completed and can forward it to their bank for processing.

clutton_2

the problem with Standing orders for HB/LHA tenants is that they get paid 4 weekly in arrears, and not all banks do 4 weekly Standing orders - if a tenant does a monthly S/O sooner or later a month will come when there is no money in the account and they go overdrawn and incur fees.

Jowo_2

clutton wrote: »

the problem with Standing orders for HB/LHA tenants is that they get paid 4 weekly in arrears, and not all banks do 4 weekly Standing orders - if a tenant does a monthly S/O sooner or later a month will come when there is no money in the account and they go overdrawn and incur fees.

I didn't realise about the constraints for a 4 weekly S/O so thanks for that.

However, from a business (or evil depending on your stance) perspective, if rent is payable monthly at x day of the month, this is what the tenant must do and budget accordingly to ensure their rent is prioritised and there are funds in their account to meet it.

The fact that HB/LHA is payable in 4 weekly cycles when most rent is chargeable on a monthly basis is a weakness of the system (in the same way that the claimant gets it in arrears while rent is payable in advance) but that's the tenant's problem to manage, not the landlords.

If the tenant in this thread does not consent to a S/O being set up which is the main way rent is paid, it indicates that their mindset is one where they feel that late payment is the landlord's problem to suffer, not theirs to solve.

samroo

Be wary of having the rent paid direct to you if you believe tenant is fraudulently claiming housing benefit. Any benefit paid to you can be claimed back by the council if this were found to be the case

socrates

samroo wrote: »

Be wary of having the rent paid direct to you if you believe tenant is fraudulently claiming housing benefit. Any benefit paid to you can be claimed back by the council if this were found to be the case

Had you read through the thread properly - this has already been stated