Renting to DSS???

dodger1

HappySad wrote: »

How about the council demanding rent from the past already paid to the landlord because the council records shows that they should have not paid the the DSS tenant. Can the council demand back rent from the landlord if they in the future feel the tenant should have not got the housing benefit?

In your case that's irrelevant as you won't have been the landlord when the overpayment was made.

BigAunty

Flashmanchop wrote: »

You will only get the rent paid direct if they meet certain criteria,8 weeks in arrears, drug user, proof of non payment of rent.

It's broader than that, its about whether or not the council (not the tenant, not the landlord) believe that the tenant is vulnerable in some way and cannot manage their money. Yes, it covers things like addiction and a history of rent arrears, but it also covers things like learning difficulties/special needs on the part of the tenant.

Flashmanchop wrote: »

Biggest advice – only rent your property at a value you KNOWyour tenant gets. Don’t start asking for“top ups”.

Find out what LHA allowance are in your area – i.esunderland 2 bed £99.92/week. Aslong as tenant is eligible, ask for £99.92, nomore, no less.

A landlord should seek the market rent for their property. They aren't a branch of social services. A bad tenant (in employment or on benefits) simply doesn't pay the rent, whatever it is.

The problem with your approach is the Local Housing Allowance (calculation for private sector HB rates) is set at the lowest third of market rents, the bottom third cheapest in the area.

Even then, plenty of tenants on HB come onto the forum saying that this formula is a fantasy - there is nothing at all in their area in that price range, everything is dearer, so there is a suspicion that it isn't truly calculated using the 30th percentile.

The reason why LHA rates are so low is because the government is seeking to slash the HB bill which is approaching £20 billion pounds. For example, in the past, tenants under 35 could get a rate for a 1 bedroom property but now get a much smaller rate based on the expectation they will live in a flatshare rather than their own place. Rates used to be set at the 50th percentile (meaning half of properties to rent should have been affordable to HB claimants). HB claimants could also keep up to £15 a week if their rent was lower than the LHA rate.

All now gone due to government changes, none of which has anything to do with the actual commercial value of residential property lettings and not the landlords issue, but the tenants, to deal with.

You do have a point that if the rent is much higher than the LHA rate, some claimants could struggle to top it up but then, a good landlord will screen out anyone who can't afford the rent in the first place or will manage the risk by insisting on a guarantor.

Some claimants, such as lone parents with multiple kids, have disposable incomes that approach what professionals earn in employment and therefore have a bit more contingency (over £300 disposable income a week for 3 kids with no housing costs like Council Tax/rent) compared with a single person without dependents that will only get £70 a week. It doesn't mean that the lone parent necessarily has better budgeting skills than a thrifty single person on JSA, though...

BigAunty

Pixie5740 wrote: »

You could also ask for a guarantor if the tenant is able to find someone daft enough to do it.

But make sure the guarantors agreement is watertight. There are apparently fairly simple ways to invalidate the guarantee. We see plenty of posts on here from guarantors frustrated at their friends and relatives not paying their rent who find out how to wriggle out of their obligation.

lighting_up_the_chalice

To answer the specific question asked. If the tenant has HB paid direct to them, then passes it on to the landlord as rent, that council will NOT be able to recover any loss/fraud from the landlord and would have to go after the tenant for recovery. Obviously, if the landlord is complicit in any fraud, that's a bit different. But, assuming the landlord acts in good faith, monies paid by the tenant cannot be recovered by the council.

Of course, in recovering any over-payment from the tenant, they may reduce the amount paid to him/her, which may effect the affordability of any current/future let.

Smi1er

BigAunty wrote: »

HB is paid directly to virtually all tenants (except those who are considered too vulnerable to manage their affairs) whereas in the past the tenant could direct payments from the council to the landlord. That changed a few years ago and is one reason why HB claimants are less popular, seen at higher risk of not passing the rent on.

Is it? I've had HB tenants for years, and HB directly paid to me. There are test cases of LL's not having to pay by HB paid in mistake. I don't have details but read about them in Landlord associations leaflets etc

Viberduo

As a benefit tenant myself I see how tough it is for finding properties that take benefits, all the ones I have taken that I can afford had been bad landlords(as the best landlords are for more expensive properties or want rent in advance etc)

Since the age for 1 bed rate was raised it has become almost impossible since you cannot get benefit for flatshares unless you are on contract and they can end up just as expensive for a tenant than a flat because councils pay less than the cost of sharing i.e if the rent includes bills they reduce how much they pay so a £80 per week flatshare and shared rate £60 goes down to about £45 so its a £35 a week topup! or when I lived in a block of bedsits but had shared kitchen but own bathroom I had a larger room and ensuite and LHA was £60 a week max they decided since other tenants who had rooms half the size and had to share a bathroom was £50 I was only entitled to £50 and I had to pay through a meter for bills yet a furnished flat was £75 a week so I could of got a flat for topping up £15 a week of my benefits or just a room for £10!

Going back to prices of properties, apart from those few student digs everywhere has been crazy priced, in my home town which has thousands unemployed and LHA 1 bed rate is only about £75 a week cheapest flat is £90 a week cheapest bedsit £75 a week too yet shared rate is £50 a week! how can people afford that in a area of high unemployment, the next town I moved to cheapest flat was £90 a week(I checked weekly on gumtree and in local paper for months over a few years period) LHA WAS £65 a week shared now its £60 yet somehow my new town in a poor estate I can get a 2 bed flat for £65 a week and LHA is £60 and a 1 bed flat is about £80 a week(unfurnished that is)

It seems councils just go for the cheapest rents and not that flat is unfurnished or that its miles out from town etc.

BigAunty

Smi1er wrote: »

Is it? I've had HB tenants for years, and HB directly paid to me. There are test cases of LL's not having to pay by HB paid in mistake. I don't have details but read about them in Landlord associations leaflets etc

I, too, have heard that councils subvert the formal process and pay the landlord direct to reduce hassle, plus older HB claimants who haven't had their ASTs renewed since the introduction of the legislation in 2007 may be on the old system.

This is how it is supposed to operate - taken from the Shelter website. The whole point of the change of legislation is the government's insistence that tenants on HB need to take personal responsibility for budgeting (among other aims).
Who does local housing allowance get paid to?

Local housing allowance is paid directly to you. However, it can be paid straight to your landlord where:

• you have rent arrears of eight weeks or more
• you are already getting deductions from your income support, employment and support allowance or jobseeker's allowance to pay for rent arrears
• your council helped you get your private rented accommodation.

The council can also pay your LHA straight to your landlord if it believes you are:

• likely to have problems managing your financial affairs because you have a learning disability or a drug or alcohol problem
• unlikely to pay your rent and are aware that you have consistently failed to pay rent in the past, without good reason.

To come to a decision the council can consider information from various sources such as:

• yourself
• your family
• your landlord
• your doctor
• your probation officer
• community mental health teams
• social services departments
• welfare officers.

dodger1

Viberduo wrote: »

Going back to prices of properties, apart from those few student digs everywhere has been crazy priced, in my home town which has thousands unemployed and LHA 1 bed rate is only about £75 a week cheapest flat is £90 a week cheapest bedsit £75 a week too yet shared rate is £50 a week! how can people afford that in a area of high unemployment, the next town I moved to cheapest flat was £90 a week(I checked weekly on gumtree and in local paper for months over a few years period) LHA WAS £65 a week shared now its £60 yet somehow my new town in a poor estate I can get a 2 bed flat for £65 a week and LHA is £60 and a 1 bed flat is about £80 a week(unfurnished that is)

It seems councils just go for the cheapest rents and not that flat is unfurnished or that its miles out from town etc.

Which area do you live in V.

HappySad

If the rent is paid to the tenant can the council demand rent back from me the landlord if the council believed or have calculated they paid the tenant in error? I want to know that if I get rent from tenant that the council can in no way demand the money back..

I know someone who is a single parent that I am considering renting out a property to, but I want to be sure that I can keep all rent paid. Without the council wanting it back for what ever reason.

dodger1

HappySad wrote: »

If the rent is paid to the tenant can the council demand rent back from me the landlord if the council believed or have calculated they paid the tenant in error? I want to know that if I get rent from tenant that the council can in no way demand the money back..

I know someone who is a single parent that I am considering renting out a property to, but I want to be sure that I can keep all rent paid. Without the council wanting it back for what ever reason.

Several posts have said you aren't liable if the HB is paid to the tenant. If you are still unsure just phone your local council and ask.