No DSS tenants

D_M_E

This has probably been posted before but a new story worth repeating.

Agents and landlords risk being fined for refusing tenants on benefits -

https://www.bbc.co.uk/news/education-51642316

Article mentions refusal as part of the mortgage conditions but does not mention insurance companies banning landlords from letting to benefits recipients.

tom9980

Well i don't write these kind of conditions on the advert so no problem, I consider the application and reject it for affordability reasons. The reason? LHA rate is £665 for a 3 bed house but the actual rents for 3 beds in the area are £750-850 for a 3 bed depending on location. The fact the LHA is not directly paid to the Landlord, that there is a delay in its payment, that the applicant has very little money or assets and has to top up rent means it is not affordable for them to rent.

Housing association and council properties have lower rents but this can mean not enough income to encourage them to build more properties, less properties means higher demand and higher rents in the private sector.

ElephantBoy57

tom9980 said:

I consider the application and reject it for affordability reasons. The reason? LHA rate is £665 for a 3 bed house but the actual rents for 3 beds in the area are £750-850 for a 3 bed depending on location.

The prospective tenant may have parents/Sugar Daddy with a substantial income. It is ok to reject after you correctly find prospective tenant does not have the means to pay the rent.

Retired_Mortgage_Adviser

As a landlord myself, I completely agree that the private rental market is entirely unfair to housing benefit claimants. However, I just couldn't rent to them even if I wanted to because -

- btl mortgages often prevent renting to benefit claimants

- hb levels fall woefully short of local market rents (I'm not talking about 5-10% lower, more like 25-30% lower)

- hb tenants can't choose to have the benefit paid directy to the LL even if they wanted to

It's a broken system and unless the above is sorted, this isn't going to change. Agents and LLs will have to tiptoe around the issue but the end result will be the same.

FreeBear

tom9980 said: The fact the LHA is not directly paid to the Landlord, that there is a delay in its payment, that the applicant has very little money or assets and has to top up rent means it is not affordable for them to rent.

Even with Universal Credit, there is a mechanism in place that allow for rent to be paid directly to the landlord. The downside is if the claimant is found to be enaging in benefit fraud, the DWP can (and will) reclaim the rent from the LL. So on that basis, always better to get the tenant to handle claiming and then paying the rent out of their own bank account.

D_M_E

Seems the landlord is stuck - BTL mortgages and a lot of Landlord insurance policies contain a No Benefits/DSS renters clause, so does this mean that the people in the article should have included mortgage and insurance companies as defendants as well as landlord/agents in their respective cases?

ElephantBoy57

FreeBear said:

Even with Universal Credit, there is a mechanism in place that allow for rent to be paid directly to the landlord. The downside is if the claimant is found to be enaging in benefit fraud, the DWP can (and will) reclaim the rent from the LL. So on that basis, always better to get the tenant to handle claiming and then paying the rent out of their own bank account.

I find that difficult to believe.

csgohan4

FreeBear said:

tom9980 said: The fact the LHA is not directly paid to the Landlord, that there is a delay in its payment, that the applicant has very little money or assets and has to top up rent means it is not affordable for them to rent.

Even with Universal Credit, there is a mechanism in place that allow for rent to be paid directly to the landlord. The downside is if the claimant is found to be enaging in benefit fraud, the DWP can (and will) reclaim the rent from the LL. So on that basis, always better to get the tenant to handle claiming and then paying the rent out of their own bank account.

ElephantBoy57 said:

FreeBear said:

Even with Universal Credit, there is a mechanism in place that allow for rent to be paid directly to the landlord. The downside is if the claimant is found to be enaging in benefit fraud, the DWP can (and will) reclaim the rent from the LL. So on that basis, always better to get the tenant to handle claiming and then paying the rent out of their own bank account.

I find that difficult to believe.

Can you both link your sources to see which is correct

pickledonionspaceraider

csgohan4 said:

FreeBear said:

tom9980 said: The fact the LHA is not directly paid to the Landlord, that there is a delay in its payment, that the applicant has very little money or assets and has to top up rent means it is not affordable for them to rent.

Even with Universal Credit, there is a mechanism in place that allow for rent to be paid directly to the landlord. The downside is if the claimant is found to be enaging in benefit fraud, the DWP can (and will) reclaim the rent from the LL. So on that basis, always better to get the tenant to handle claiming and then paying the rent out of their own bank account.

ElephantBoy57 said:

FreeBear said:

Even with Universal Credit, there is a mechanism in place that allow for rent to be paid directly to the landlord. The downside is if the claimant is found to be enaging in benefit fraud, the DWP can (and will) reclaim the rent from the LL. So on that basis, always better to get the tenant to handle claiming and then paying the rent out of their own bank account.

I find that difficult to believe.

Can you both link your sources to see which is correct

The rent can be paid direct to the LL, the claimant needs to request this though it is not automatic

It is about time the government brought the LA rates up to match the rents in the local area.  It really is inequality if one tenant is in a Council place - getting their rent completely covered,  and one in a private rented having to find £30 a week out of £62 benefit.
It is a massive injustice

It is so hard for people to find a home.  The whole 'No DWP' thing, it is as offensive to an entire group

[Deleted User]

ElephantBoy57 said:

FreeBear said:

Even with Universal Credit, there is a mechanism in place that allow for rent to be paid directly to the landlord. The downside is if the claimant is found to be enaging in benefit fraud, the DWP can (and will) reclaim the rent from the LL. So on that basis, always better to get the tenant to handle claiming and then paying the rent out of their own bank account.

I find that difficult to believe.

And yet it is true.
If the rent is paid directly to the landlord and there has been an overpayment (clerical error, fraudulent claim, whatever the cause), the council will usually ask the landlord to pay them the whole overpayment at once, it's called "clawback". The landlord will then ask the tenant to pay the money back on top of your rent.  How easy do you think it will be for a landlord to recover that money from a fraudster who's either legged it or doesn't have a pot to !!!!!! in.

https://www.citizensadvice.org.uk/benefits/help-if-on-a-low-income/housing-benefit/problems-with-housing-benefit/paying-back-a-housing-benefit-overpayment/

https://www.landlordlawblog.co.uk/2011/10/18/five-ways-for-landlords-to-ensure-payment-of-housing-benefit/

Brock_and_Roll

pickledonionspaceraider said:

csgohan4 said:

FreeBear said:

tom9980 said: The fact the LHA is not directly paid to the Landlord, that there is a delay in its payment, that the applicant has very little money or assets and has to top up rent means it is not affordable for them to rent.

Even with Universal Credit, there is a mechanism in place that allow for rent to be paid directly to the landlord. The downside is if the claimant is found to be enaging in benefit fraud, the DWP can (and will) reclaim the rent from the LL. So on that basis, always better to get the tenant to handle claiming and then paying the rent out of their own bank account.

ElephantBoy57 said:

FreeBear said:

Even with Universal Credit, there is a mechanism in place that allow for rent to be paid directly to the landlord. The downside is if the claimant is found to be enaging in benefit fraud, the DWP can (and will) reclaim the rent from the LL. So on that basis, always better to get the tenant to handle claiming and then paying the rent out of their own bank account.

I find that difficult to believe.

Can you both link your sources to see which is correct

The rent can be paid direct to the LL, the claimant needs to request this though it is not automatic

It is about time the government brought the LA rates up to match the rents in the local area.  It really is inequality if one tenant is in a Council place - getting their rent completely covered,  and one in a private rented having to find £30 a week out of £62 benefit.
It is a massive injustice

It is so hard for people to find a home.  The whole 'No DWP' thing, it is as offensive to an entire group

It would be a lot simpler (and cheaper for the taxpayer) if LAs borrowed from the PWLB, built or bought the houses themselves and cut out the middleman!