rent and a tenant on benefits

billozz

can someone explain how the system works if you have a tenant in a property you own that claims benefits.
how much can you charge them,
is the money paid to you or the tenant,
and any other advice that might be relevant
thanks
Bill

pukkamum

As far as i am aware you would charge tenants on benefits the same rent you charge anyone, they can choose to either have the housing benefit paid directly to you or paid to them and they pay it to you.

tbs624

Except in specific circumstances ( vulnerable T etc) the HB/LHA will get paid to the T not the LL.

OP - you charge the market rent and the T may need to top up if the benefit received is a lower figure than the actual rent.

Is the T already in place or are you talking about a new potential T? If the latter you should check your mortgage Ts and Cs ( because some will exclude tenancies to recipients of certain benefits) and you may want to ask the T to provide a guarantor

If you are an inexperienced LL then search on here for G_M's monumental post for newbies

lighting_up_the_chalice

The rent "should" be the market rent. However, you can see how much LHA (Housing Benefit) is paid by looking on your local authority website. This may vary depending on any income they may receive or any previous overpayment being deducted.

Apart from a few specific circumstances, LHA is ALWAYS paid to the tenant.

Mrs_Imp

In some areas, if the tenant believes that they will be unable to pay the rent on time to the LL (eg a track record of being poor with budgeting, or having 'friends' who only turn up when there's money around to 'borrow') they can request for the rent to be paid directly to the LL straight away. I'm not sure whether or not a LL can apply to have the rent paid directly.

It's not something to worry about until there are signs that the T is struggling to pay on time. Most people that I know who are on benefits are good at paying on time.