What are the implications of being a permitted occupier?

fd101

Hi All

Really hoping someone can offer me some advise.

Myself and 2 other individuals are looking for a 3 bed flat to rent. We have found somewhere but it doesn't have a HMO C4 license (our council requires this for more than 2 unrelated sharers). The LA said we could get around this by putting the 2 highest earners on the tenancy agreement and then the lowest earner (me) would be a permitted occupier. Apparently the LL has agreed to this. They said only the 2 on the TA would then put their names on all bills, council tax etc.

Is this legal??!

What are the implications for us if we do this? The main things I've tried to work out/am confused about are:

1. My housemates must trust me to pay rent and bills as they are liable not me?
2. I won't have anything with my name and address on to prove I live there. I use my Mum's address as my main postal address anyway, so this isn't a disaster, but may cause problems if I want to join local doctors surgery etc?
3. Do I have any rights with regards to being kicked out with no notice?
4. What happens if the council find out there are 3 people sharing the house without this C4 licence? Will we get in trouble or the LL? And if the LL in trouble will we end up losing our place to live?
5. The LA are saying they will charge me the same fees as the 2 tenants for referencing etc. Seeing as I'm not actually a tenant why should I need references and credit checks at all?!

I am soooo confused right now. Really like this flat and struggling to find anywhere that allows sharers, but don't want to go into anything dodgy!

I will be extremely grateful for anyone who can clarify any of the above points.

Thanks :A

Werdnal

Others will be able to confirm the full legal position here, but I have read it is the number of people sharing that makes it an HMO, not the agreements they are given. If so, this is typical letting agent twaddle you are being fed. However, you will not be in trouble if the council find out, but the LL definately will. HMOs require different H&S requirements and other legislation in order to comply with the licence regs, so if the LL is cutting corners, he will be the one fined and punished for this - but sound like he will claim not to know you are there as you are a lodger of the 2 tenants. If you do not have any liability for the tenancy agreement, you will have no security to stay - the other 2 tenants may be allowed to!

You will be a lodger, and should be given a lodger agreement by one of the other tenants.

Seems agents want their cake and eat it - you are a lodger and your lodger agreement is the responsibility of the 2 tenants, so should you should not be paying any fees to the agent. The 2 tenants are the only ones responsible for the rent and they are liable for any damage or losses associated with the tenancy - you won't have a tenancy!

CIS

They said only the 2 on the TA would then put their names on all bills, council tax etc.

From a council tax point of view only the named tenants (and any resident partners) are liable for the council tax.

G_M

fd101 wrote: »

....
Is this legal??!
Nothing illegal here. Plod cannot arrest anyone.

What are the implications for us if we do this? The main things I've tried to work out/am confused about are:

1. My housemates must trust me to pay rent and bills as they are liable not me? Yes... & no. They will jointly be liable for the full rent payable to the landlord (via the agent). If unpaid, the LL will not be able to chaseyou for arrears. However, as their lodger, you will be liable to them (your housemates) for whatever rent you agree (presumably 1/3 of whatever they are paying the LL)
2. I won't have anything with my name and address on to prove I live there. I use my Mum's address as my main postal address anyway, so this isn't a disaster, but may cause problems if I want to join local doctors surgery etc? You can give the surgery your address as you will be a lodger there. Likewise you can give the address to your bank, employer etc. You can also put yourself on the electoral register. Your only difficulty will be providing proof of address to eg open a new bank account, as they often require a utility bill in your name.
3. Do I have any rights with regards to being kicked out with no notice? As a lodger, very few. Your housemates could kick you out any time.
4. What happens if the council find out there are 3 people sharing the house without this C4 licence? Will we get in trouble or the LL? The landlord. And if the LL in trouble will we end up losing our place to live? Possibly. I amnot an expert in HMOs, but believe the council would require the LL to register, & to dothis he is likely to have to upgrade the property (fire doors etc). If minor works, the councilmay allow the tenancy to continue during thisprocess. If the works are significant, they might force the tenancy to be ended.
5. The LA are saying they will charge me the same fees as the 2 tenants for referencing etc.:rotfl::rotfl: Seeing as I'm not actually a tenant why should I need references and credit checks at all?! You should not. If you go down this route, get your 2 housemates to apply as tenants, and pay fees in normal way. You, and your name should not even be mentioned. Theonly thing to ensure is that any clause in the tenancy agreement prohibiting lodgers is crossed out. It is then up to your housemates to choose their lodger (you), NOT the landlord/agent. However, I suspect the agent wants to include your name on the tenancy agreement as an 'Excluded Occupier'. A pointless procedure, except that it vaguely justifies them charging you a fee!
6. I am soooo confused right now. Really like this flat and struggling to find anywhere that allows sharers, but don't want to go into anything dodgy!

I will be extremely grateful for anyone who can clarify any of the above points.

Thanks :A

Hope this helps a bit.

franklee

Is there an implication here people think the HMO rules twaddle? If they require improved fire safety measures when there are three unrelated occupiers then surely the OP would be wanting to live somewhere with those measures in place? Regardless of who has what tenancy, regardless if the council find out, there will still be three unrelated people living in the property. I wonder what the implications would be if there was a fire, will all insurance still pay out etc?

If the council do find out the LL may ask the lodger to leave with the excuses it's against the tenancy agreement. If so this leaves the two tenants bound to pay the bills themselves until the end of the tenancy with no claim from the departed lodger. Can they afford that? I doubt the agent would allow the lodger to live there officially as otherwise they are back to square one on the HMO.

OP you could always ring up the council and ask what would happen if you were the lodger. If you feel letting the council know would be wrong then your dodgy radar should go off. I'd be surprised if the HMO rules can be got around that easily or everyone would be doing it. I'm quite surprised the agent is suggesting it.

theartfullodger

CIS wrote: »

From a council tax point of view only the named tenants (and any resident partners) are liable for the council tax.

Errr... don;t think so...

So, single mum & 3 sons aged 32, 28 & 25 in residence with her & you're suggesting she would still be entitled to single person's 25% discount?? Don';t think so... see
https://www.gov.uk/council-tax/council-tax-exemptions

A full Council Tax bill is based on 2 or more adults living in a household.

Says nowt about them being tenants, permitted occupiers, owners, or rent-free cousins of the owner.. It's how many adult occupants & are any exempt (eg students..), not who is or is not named on the tenancy. If you doubt me please check with council council tax persons...

princeofpounds

If tenants make a house into an HMO by acquiring lodgers could they not be at risk of trouble if the council cottons on to them? The LL might be hoping to 'delegate' this risk if so.

Mind you, if the tenants have evidence that the LA knew all about the lodgers from the beginning (application forms etc being great evidence) then surely the LL could be nailed quite easily.

pmlindyloo

theartfullodger wrote: »

Errr... don;t think so...

So, single mum & 3 sons aged 32, 28 & 25 in residence with her & you're suggesting she would still be entitled to single person's 25% discount?? Don';t think so... see
https://www.gov.uk/council-tax/council-tax-exemptions


Says nowt about them being tenants, permitted occupiers, owners, or rent-free cousins of the owner.. It's how many adult occupants & are any exempt (eg students..), not who is or is not named on the tenancy. If you doubt me please check with council council tax persons...

I believe liability for council tax is all to do about the hierarchy of liability - see here:

http://www.adviceguide.org.uk/england/tax_e/tax_council_tax_ew/council_tax.htm

In this case I believe the tenants will be liable and the permitted occupier will not be.

However, I have to agree that the LL/LA are pulling a 'fast one'.

If the council are declaring this to be HMO then the LL would be liable for paying the council tax. The LL would also have additional responsibilities. I do not know what they may be as there are different types of HMO.

If the OP is a permitted occupier then there is no need for there to be any credit checks etc.

I agree that the OP could become a lodger of one of the tenants. If this goes ahead it will all be about trust between them all.

Usually where there are unrelated people sharing someone has to take the responsibility of paying all the bills anyway.

If the issue of safety (smoke alarms for example) is sorted out there is no reason why this can't work if everyone is good friends.

When friends share together there is sometimes a 'falling out' or someone wants to move out and there is often some movement within the fixed tenancy as one person replaces another with the LL's consent. Perhaps it is possible for a lodger agreement to be drawn up which gives the OP some sort of security like the others.

My daughter is in this position (although has a tenancy agreement) and friends have moved out and been replaced several times.

fd101

Thank you so much everyone for taking the time to reply.

My dodgy radar is beeping at the fact the LA would even suggest this...I'm not sure I want to be relying on them to sort anything out with the flat for the next 6 months if they are this sketchy from the start!

My housemates seem happy to go ahead and trust me. I'm not so sure. If we did do this, what sort of notice can I hope for if I did have to move out because LL changed their mind or had to get me out because council found out? Are we talking hours, week or month?!!

Thanks again :-)

fd101

Oh and we have emails from the LA to all 3 of us asking what we all do for jobs etc. and saying to tell them which 2 will go on the TA and who will be the permitted occupier...I'd say that's pretty good evidence that the LA knows what they're asking us to do and that I existed from the start!?!

pmlindyloo

fd101 wrote: »

Oh and we have emails from the LA to all 3 of us asking what we all do for jobs etc. and saying to tell them which 2 will go on the TA and who will be the permitted occupier...I'd say that's pretty good evidence that the LA knows what they're asking us to do and that I existed from the start!?!

If you are feeling uneasy about the situation then I should follow your gut instincts and give this one a wide berth. Of course your friends (without sounding too mean ) are going to be OK with this as they have security.

If you all have jobs then finding a place really shouldn't be that difficult.

There are potentially problems with renting in any situation and if you have 'that feeling' now then the best thing is to walk away.

To appease your friends perhaps you could be very proactive in finding somewhere for you all to live - you don't want to fall out at the beginning!