Tips needed please. 1st time landlord

Sammy_Dee

Hi Guys,


Advice from experienced landlords needed.
My hubby and I are looking to rent out his house in Coalville. We have consent to let from mortgage provider, gas safety cert and electrical cert (I know the electrical cert isn't mandatory, but we erred on the side of caution)

We are looking to advertise the house, however someone has already approached us, they are however receiving housing benefit.

Can I please have some tips on what to do next?
Any drawbacks to accepting HB or similiar?

Selling the house isn't a possibility btw. Nor is living in it

poppysarah

Get references.

Best to have HB paid direct to you - but any repayments the council chase you for.

Have you checked what LHA they will get?

Sammy_Dee

They will be entitled to 126 pw - which covers the 540 per month we are asking for.

References are deffo a must

i didn't think that we could get the HB paid directly to us anymore? Unless the tenant was in arrears?

poppysarah

The tenant can request it I think.

How much deposit are they paying and do you know which scheme you'll use to register it with?

Sammy_Dee

No idea yet! Hence asking for advice! lol

Which schemes are the best?
How much should we ask for do you think?

Biciitalia

Hi - people on HB do tend to get a bad name but I can share my experience in a positive light. I had a single mum with a 8 year old daughter living in my house and they kept it to a very high standard. I did have issues with late rent but this was more the Benefits office changing the dates of payment. I would recommend a guarantor for the rent though. She left in the end as she felt she was being spied on by the neighbours who were not happy that someone on benefits was living in a nice house and area whilst they had to work - none of their business I know but it was definately a factor. Good luck.

poppysarah

Sammy_Dee wrote: »

No idea yet! Hence asking for advice! lol

Which schemes are the best?
How much should we ask for do you think?

Probably a months rent is usual...
but the references are vital.

Could you pop round and see them where they live now? * just to tell them about the deposit ...

Jowo_2

No, the tenant cannot direct payment to the landlord under LHA as they could previously under HB. This only applies to vulnerable tenants who the council accept as not being able to manage their budgets (or the landlord can request it if there are significant arrears).

Many landlords who accept LHA tenants request a guarantor as a condition of the tenancy, appreciating that there is no way to recover any arrears or cost of damage from someone on a low income and that if the recipient cannot come up with a working friend/relative to underwrite their rent, this is telling.

The risks of having a LHA tenant is that in some areas they are harder to evict. If a landlord serves notice on a non-working tenant, there is a higher chance of them approaching the local council. They often operate a gate keeping policy to cut down demand on their services and tell the tenant to ignore the notice until the landlord has gained a court order for possession. The tenant is told that if they move of their own volition, they will have made themselves intentionally homeless. There are dozens of threads on Landlord forums about this difficulty.

See Landlordzone on how to screen tenants, how to arrange a guarantor and read their HB/LHA forum to understand the risks/issues that some landlords experience with benefit claimants.

Don't be tempted by the perceived 'guaranteed' rent due to the tenant's LHA - subject them to the same screening (multiple previous landlord refs, credit check, ID check, etc) as any other tenant. Typically a current landlord may give a good reference to get rid of a problem tenant but the one before might be a lot more candid.

JA1000

Don't do it as a first time. I know one post is favourable but for every one you'll find a lot more not favourable.

placido

We seem to have a "stereotypical" view of HB claimants here; but in fact they come in all shapes and sizes.

Pensioners, for example, are treated much more favourably under the benefits system. They may get full HB and have higher disposable income on Pension credits. Also a lot of pensioners are from a generation who had it drummed in to them that "the rent always comes first".

Some younger people may get disability benefits in addition to their HB, which also gives them more generous disposable incomes.

A lot depends on individual circumstances. What is the reason for the HB?? Is it because the claimant is "short-term" or "long-term" unemployed? Is it because they have disabilities that prevent them from working?? Is it because the claimant is a single parent who cannot work because they have children to look after??

Some HB claimants will have more "secure" HB incomes than others, whose circumstances are likely to change.

I once rented out my house to a couple on HB. They made a mess of rent payments and I had it paid directly to me. (It was allowed then). Eventually they left without giving notice and I had to repay the council £350. I was not too fazed. I had three years rent from them. They left the house in good nick, and I wanted to move back in anyway.

Over the past few years I have lived in rented property with other tenants who have been 1. A pensioner on HB. 2. A 30 year old man on HB and disablity benefits. and 3. A couple with a child, the father sometimes in work but more often unemployed.

The guy on disability benefits used to do all the house maintenance (voluntarily) and all the tenants got on well with each other. Everyone paid their rent on time, It was a landlords dream. He would come round on Xmas eve with a bottle of wine each for us.

I think the best advice you have been given is to screen the prospective tenants carefully. How they have behaved in the past will probably be your best guide as to how they will behave in the future.

Some HB claimants are very responsible people. Obviously, some are not but then that applies to non HB claimants too. It is the individual/s you need to look carefully at. Every one is different!