Please advice on "referencing* for renting

BookwormPrincess

Thanks dapast, that's useful information.

Unfortunately because we can only move to a very specific location, we have been at the mercy of whatever became available through whichever agent, LA or private. It's to do with my health and needing to be within a short walking distance of the children's school etc.

But that is useful for the future, considering we will be applying for a lump sum IVA with the house sale capital. If we could have moved to any area we would have approached some of the people we already know who are landlords to cut out LAs.

At the moment, we are still waiting for the results of the referencing. LetAlliance have contacted us for proof of income, which we have provided (had actually already given to LA but they incompetently didn't pass it on to LetAlliance!). So I don't know if that is good news or bad or neither. I did wonder that if we had failed the initial credit check, whether they would even bother to continue to confirm income or not? Still, I suspect we won't hear until the middle of next week. Especially as the LA hasn't even submitted the forms for the guarantor yet - her reasoning is that if we fail the referencing, we won't lose the guarantor fee. She said it is how she usually processes things, so I hope it is not a bad sign for us individually.

happy_bunny_2

Rental credit checks only see public records info like CCJs, IVA, bankruptcy. They won't see defaults or like.

I wouldn't volunteer the info, the credit score will be based on public records plus other stuff like age, job etc.

They make it sound like they know everything about you to market up the credit scoring services.

BookwormPrincess

Thanks happy_bunny, makes me more hopeful that we will pass the credit checks.

We have been upfront about the DMP from the start, because our Debt Management Company recommended it and so did LetAlliance (who are the referencing service - we rang them for advice before applying). It seemed to concern the Letting Agent regarding the possibility of failing credit checks, however they still put us forward to the Landlady and the Landlady still chose us and has agreed the Let subject to referencing. So if it is only CCJs, IVAs etc that they are looking for it seems we should be ok .....

I'll let you all know when we find out. Hopefully should know by the end of next week.

BookwormPrincess

Just for closure, we did get the rented property - our application was successful!! :T
Thanks everyone for your advice.
Realised that LAs can't see as much of your credit history as I thought, but the landlady appreciated our upfront honesty about our situation.

Elfbert

Excellent news!

Good luck to you and your family escaping debt and managing to spruce up your new home. I hope now the stress is over you feel a bit better, too.

BigAunty

HappyMJ wrote: »

Problem is housing benefit is not guaranteed. They (council) could say you used your proceeds from the sale of the house to intentionally pay off an unsecured debt to reduce your capital and you get nothing in housing benefit. It's called deprivation of capital....so just best not to mention anything to do with housing benefit..

Woah, there. Deprivation of capital is about the claimant intentionally depriving themselves of their capital in order to claim benefits so the onus is on the authority to demonstrate it as a strong motive. It's a very complex area and each investigation is processed on a case by case basis.

The information I have seen on the repayment of debt is that it's fine when it comes to legally due debts, just that it's not acceptable to pay off a loan early or pay down the mortgage with a lump sum, for example. I can't say I know the specific position with a DMP though.

The OP should enquire about this issue on the benefits forum as there are people there who work in HB (a poster called Housing Benefit Officer). Unfortunately, this type of issue leads to contrary posts including people who wrongly assert that potential benefit claimants cannot pay off any type of debt, including credit cards.

As far as I know from a recent thread there, HB forms ask applicants about previous property ownership.

BookwormPrincess

Elfbert wrote: »

Excellent news!

Good luck to you and your family escaping debt and managing to spruce up your new home. I hope now the stress is over you feel a bit better, too.

Thank you, very kind.
The stress is almost over. We haven't completed on our house sale yet (exchange of contracts imminent, all going through very smoothly with the end in sight.) Once sale has completed then the fun begins with sorting out a lump-sum IVA, but this is the culmination of 2 years planning so it's all good even if very stressful right now.

BookwormPrincess

BigAunty wrote: »

Woah, there. Deprivation of capital is about the claimant intentionally depriving themselves of their capital in order to claim benefits so the onus is on the authority to demonstrate it as a strong motive. It's a very complex area and each investigation is processed on a case by case basis.

The information I have seen on the repayment of debt is that it's fine when it comes to legally due debts, just that it's not acceptable to pay off a loan early or pay down the mortgage with a lump sum, for example. I can't say I know the specific position with a DMP though.

The OP should enquire about this issue on the benefits forum as there are people there who work in HB (a poster called Housing Benefit Officer). Unfortunately, this type of issue leads to contrary posts including people who wrongly assert that potential benefit claimants cannot pay off any type of debt, including credit cards.

As far as I know from a recent thread there, HB forms ask applicants about previous property ownership.

Hi BigAunty,
We have spoken to our Local Council about the whole issue of deprivation of capital, and they have informed us that as long as we keep them informed about everything it should be ok. What they've said they will probably do is disregard the amount that is earmarked for the lump-sum IVA. Or it may be that we suspend the claim for Housing Benefit and Council Tax Support, use the sale capital to help pay the rent and then reinstate our claim for HB when the IVA has gone through (well, we hope the IVA will go through and be accepted). We should be completing by the end of September on the house sale, so the "fun" of informing the benefits and debt management company will follow after that. Thankfully the debt management company will help with the IVA stuff. It'll all be worth it in the end. Can't imagine what it will feel like to have the debt sorted! Hopefully it'll be a fresh start.

learningaboutmoney3

I just wanted to wish you lots of luck in your future. Life has dealt you a difficult hand but you have dusted yourself off and found ways to improve your future. Your children are very lucky to have you.

BookwormPrincess

learningaboutmoney3 wrote: »

I just wanted to wish you lots of luck in your future. Life has dealt you a difficult hand but you have dusted yourself off and found ways to improve your future. Your children are very lucky to have you.

Thank you, that is so kind. It's nice to take on board kind words in amidst this stressful move and house sale.