Shared house - collecting rent HSBC Flexible Saver

ryuuoo

Hi there,

I am currently a 3rd year student and am moving in to a house with friends this year. It has been decided that I will be in charge of collecting everyone's share of the rent each month and then paying it out to our landlord.

I have a Student account with HSBC.

I would prefer not to have everyone sending me money into this main student account and playing up with my balance each month etc... etc...

So what I thought I could do is open a Flexible Saver account (Already got an ISA, ((btw, it says on their site that if I take money out of my ISA, I cannot pay it back into it?)) and an 'Online bonus saver').

That way I could give my flatmates the Flexible Saver account number and sort code, have them pay into it x day of the month and a few days later pay it out from there.

Is this doable?/legal? It also says on their website that they will do a credit check if I want to open it, do you think this is always the case...? I don't need any more searches on my file to be honest.

Thanks guys.

Caladan

ryuuoo wrote: »

Hi there,
I am currently a 3rd year student and am moving in to a house with friends this year. It has been decided that I will be in charge of collecting everyone's share of the rent each month and then paying it out to our landlord.

So what I thought I could do is open a Flexible Saver account (Already got an ISA, ((btw, it says on their site that if I take money out of my ISA, I cannot pay it back into it?)) and an 'Online bonus saver').
ISA limits reset at the start of every tax year (April). You can pay £15240 into an ISA this tax year. If you pay £15240 in, and take £200 out, you cannot put £200 back in.

If you pay £5000 in, and take out £200, you can put another £200 back in, as it means you have 'subscribed' £5200, leaving the rest of the allowance available.

Is this doable?/legal?
Yes. However - A student receiving funds from several other people with no clear connection could raise some anti money-laundering questions, be ready to explain your transactions should you be asked.

It also says on their website that they will do a credit check if I want to open it, do you think this is always the case...? I don't need any more searches on my file to be honest.
You almost certainly wont be credit searched for a secondary savings account if you're an existing customer.

Sharon87

Sounds good, but can you pay directly from that savings account to another account? Whenever I try to make a payment to another person on my HSBC phone app the only account I can choose from is my current account, not any of my savings accounts. So you may need to collect the money into your savings account, then transfer to your main account and pay it from there.

Or you could get a different current account - like Halifax Reward that pay you £5 a month if you pay in £750 and have 2 direct debits coming from that account - so if you're in charge of bills too, say the water bill and internet can be set up on that account. Another current account will take a credit search, but 2 searches within 6 months won't negatively affect your credit rating.

jonesMUFCforever

You might have to transfer money from a savings account to a current before doing a FP to the landlord.
Alternatively just open a bog standard current account.

Caladan

Sharon87 wrote: »

Sounds good, but can you pay directly from that savings account to another account? Whenever I try to make a payment to another person on my HSBC phone app the only account I can choose from is my current account, not any of my savings accounts. So you may need to collect the money into your savings account, then transfer to your main account and pay it from there.

Or you could get a different current account - like Halifax Reward that pay you £5 a month if you pay in £750 and have 2 direct debits coming from that account - so if you're in charge of bills too, say the water bill and internet can be set up on that account. Another current account will take a credit search, but 2 searches within 6 months won't negatively affect your credit rating.

Faster Payments are allowed from an HSBC Flexible Saver (not sure about Online Saver) but to make payments on the HSBC app they need to have been paid before via the normal internet banking login using a secure key code, after the payment is done the first time I think it will allow you to do it in future on the app without having to move money around.

I've never tried making a payment directly from a savings account on the app but I imagine it's possible.

Nevertheless - Agree with the Halifax Rewards - Take the free money if you can (although Students may struggle passing credit scoring for a non-student account)!

Dobbibill

A few things I would ask......

How well do you know these fellow students?

What happens if they don't/won't/can't pay the rent into your account? Do you become liable to pay it anyway by the LL?

I know some LL's of HMO's charge per person/per room rather than holding one person liable/responsible? This way each student is responsible for their own rent.

My DS shared a house with his ex best friend and ended up financially carrying him for several months. Needless to say the tenancy agreement was terminated by DS and friendship ceased.

My other DS is a student and his LL has recommended 'Glide'. A company which divides the bills equally between all parties so no-one is liable for anyone elses share. LL also charges each student rent rather than a lump sum per month.

xylophone

It would be far better for each person to pay the landlord his own share of the rent.

If you do go with your plan, open another current account which you keep solely for the purpose of collecting the rent.

You might provide a small amount to open the account and keep this there as a float.

Make certain that your fellow tenants have set up a monthly standing order from their own accounts to this account and that you have as well - this should be for a few days before the rent is due.

All the money should be cleared in the account before the date of the standing order to pay your landlord.

jimjames

xylophone wrote: »

Make certain that your fellow tenants have set up a monthly standing order from their own accounts to this account and that you have as well - this should be for a few days before the rent is due.

All the money should be cleared in the account before the date of the standing order to pay your landlord.

Downside of this is that the OP is then liable for bank charges etc if any one of the others has a SO that is unpaid and the landlord payment takes them overdrawn.
Completely agree with your suggestion that it's better for each to pay directly.

10pence

Caladan wrote: »

It also says on their website that they will do a credit check if I want to open it, do you think this is always the case...? I don't need any more searches on my file to be honest.
You almost certainly wont be credit searched for a secondary savings account if you're an existing customer.

Do you have inside knowledge of HSBC and it's account scoring?

Having worked for them and opened savings accounts I've seen at least two instances where savings accounts have been refused for failed scoring; one mentioned they had a CCJ within the last few months. Regardless of whether the new account wasn't a 'credit' account HSBC still credit checked it after checking it's own internal scorecard.

Sharon87

When I was at uni Halifax were happy enough to open a current account for me, so I think a student should be fine getting a current account.

I agree about the no standing order. I never pay by standing order if I'm the person who pays the landlord as I have had people not pay rent on time and then that's caused me to go into an unauthorised overdraft.

xylophone

I'm assuming that the person running the account would have internet access and would be able to see that his fellow tenants' share of the rent had appeared in the account well before the payment to the landlord was due.

Speaking personally though, I would not like to be party to such an arrangement - I'd prefer to be responsible only for paying my own rent and not acting as a collecting agent/point of contact for the landlord.