credits on rent account

Janespencer

Apologise as this is my first post, i need to make people aware of an issue regarding credits on social housing rent accounts.
My mother-in-law recent became entitled to Housing Benefit, I phoned her landlord, Sanctuary Housing, to ask what we needed to do if the HB was paid direct to them as she pays her rent by DD. The response was " she needs to change her DD herself", I argued this with no avail. my next question was if she dosen't change her DD amount what will happen to the credit that will build up on her rent account "she'll have to request a refund" I asked if they check accounts for credits "occasionally". Unhappy, i request an FOI from them on, 

1. The number of rent accounts which currently show a credit balance.
2. The number of rent accounts showing a continual credit balance for the years, 2020, 2021 and 2022 to date.
3. The number of rent accounts in credit that pay rent via a Direct Debit payment
4. Total value of all accounts currently showing a credit.
5. The action taken by Sanctuary to return credits to Tenants

The response, which i can not share unfortunatley, was amazing, nearly 4500 accounts in credit amounting to over £1.5 million pounds. This figure is for both current and former tenants.

I have posted on the residents Facebook page advising them to check the balance on their accounts, but these won't reach everyone. I just want these tenants where possible to rent a credit back and for it not to sit in the landlords bank account.

This is just one social housing provider!!

_Penny_Dreadful

Janespencer said:

Apologise as this is my first post, i need to make people aware of an issue regarding credits on social housing rent accounts.
My mother-in-law recent became entitled to Housing Benefit, I phoned her landlord, Sanctuary Housing, to ask what we needed to do if the HB was paid direct to them as she pays her rent by DD. The response was " she needs to change her DD herself", I argued this with no avail. my next question was if she dosen't change her DD amount what will happen to the credit that will build up on her rent account "she'll have to request a refund" I asked if they check accounts for credits "occasionally". Unhappy, i request an FOI from them on, 

1. The number of rent accounts which currently show a credit balance.
2. The number of rent accounts showing a continual credit balance for the years, 2020, 2021 and 2022 to date.
3. The number of rent accounts in credit that pay rent via a Direct Debit payment
4. Total value of all accounts currently showing a credit.
5. The action taken by Sanctuary to return credits to Tenants

The response, which i can not share unfortunatley, was amazing, nearly 4500 accounts in credit amounting to over £1.5 million pounds. This figure is for both current and former tenants.

I have posted on the residents Facebook page advising them to check the balance on their accounts, but these won't reach everyone. I just want these tenants where possible to rent a credit back and for it not to sit in the landlords bank account.

This is just one social housing provider!!

Does your MIL really pay her rent by DD? If so then there’s no way for her to change the amount paid by the DD herself. Sanctuary need to change it. She could cancel the DD although I don’t recommend doing that unless the full amount of her rent is going to be paid by HB (or is it the housing element of universal credit that she’s receiving). If her rent is paid by standing order then yes it would down to her ti change the payment amount. 

Janespencer

Penny, that was my arguement with them, but I couldn't get it through to her that the requester of a DD should claim the amount that is due, totally different than a standing order.
I solved it my getting the LA to pay the HB direct to my MIL.
It just worries me how many older tenants go into credit when benefits change and they don't have anyone to help them out. Totally irresponsible Landlord.

Newcad

If your rent is payable weekly in advance (and many social housing rents are) but you pay by monthly DD then your rent account should be in credit by 5 weeks after each DD is made.

This is because there can be 5 weekly payments due in a calendar month.

If your rent account is not 5 weeks in credit straight after you pay a DD then that possible 5th week will show as your account being in arears until the next DD payment is made.

And regularly occuring arrears can affect your credit score.

So it is not unusual that many social housing rent accounts where rent is paid by monthly Direct Debit are kept in credit.

Janespencer

Newcad, i understand your comment but do you not consider that 4500 accounts amount to 1.5k is not exssesive?

Jude57

Newcad said:

If your rent is payable weekly in advance (and many social housing rents are) but you pay by monthly DD then your rent account should be in credit by 5 weeks after each DD is made.

This is because there can be 5 weekly payments due in a calendar month.

If your rent account is not 5 weeks in credit straight after you pay a DD then that possible 5th week will show as your account being in arears until the next DD payment is made.

And regularly occuring arrears can affect your credit score.

So it is not unusual that many social housing rent accounts where rent is paid by monthly Direct Debit are kept in credit.

Exactly this. I'm a housing association tenant and have always paid by monthly direct debit so my quarterly rent statements show either a large credit or a small debit depending on the date of the month the statement is produced. It's an anomaly that tends to apply only to social housing because, while most working people these days are paid calendar monthly, most benefits are paid fortnightly (except state pension which is paid every four weeks). Social housing rents are still charged weekly however the tenant chooses to pay them. However, social landlords don't report arrears to credit reference agencies until and unless they have obtained a County Court Judgment for the arrears. The fluctuating credit/debit described here are not reported and do not affect your credit score. Source for that statement, over 20 years working in local government dealing with arrears among other things.

As to the OP, you're correct that a direct debit amount can only be altered by the originator, in this case the housing association. You are certain that your mother pays by direct debit so, that being the case, I'd email them to remind them of that and to ask, in accordance with the Direct Debit Guarantee by which they are bound, for a written confirmation of the revised amount due.

https://www.directdebit.co.uk/direct-debit-explained/direct-debit-guarantee/

Jude57

Janespencer said:

Apologise as this is my first post, i need to make people aware of an issue regarding credits on social housing rent accounts.
My mother-in-law recent became entitled to Housing Benefit, I phoned her landlord, Sanctuary Housing, to ask what we needed to do if the HB was paid direct to them as she pays her rent by DD. The response was " she needs to change her DD herself", I argued this with no avail. my next question was if she dosen't change her DD amount what will happen to the credit that will build up on her rent account "she'll have to request a refund" I asked if they check accounts for credits "occasionally". Unhappy, i request an FOI from them on, 

1. The number of rent accounts which currently show a credit balance.
2. The number of rent accounts showing a continual credit balance for the years, 2020, 2021 and 2022 to date.
3. The number of rent accounts in credit that pay rent via a Direct Debit payment
4. Total value of all accounts currently showing a credit.
5. The action taken by Sanctuary to return credits to Tenants

The response, which i can not share unfortunatley, was amazing, nearly 4500 accounts in credit amounting to over £1.5 million pounds. This figure is for both current and former tenants.

I have posted on the residents Facebook page advising them to check the balance on their accounts, but these won't reach everyone. I just want these tenants where possible to rent a credit back and for it not to sit in the landlords bank account.

This is just one social housing provider!!

As @Newcad has explained, there's a simple reason for direct debit rent accounts showing credits at certain times. It doesn't mean that the social housing provider is sitting on vast amounts of tenants' cash they should be refunding and the situation isn't analogous to energy providers allowing clients to build up huge credits by overpaying for their energy. I'm sure you'll be letting the local Facebook group know so that people aren't under the mistaken impression that they can claim refunds.

Janespencer

Thank you for your comments, I feel happier now.

Newcad

Janespencer said:

Newcad, i understand your comment but do you not consider that 4500 accounts amount to 1.5k is not exssesive?

The alternative would be for everyone to have to pay rent weekly with no monthly DDs allowed, or for many of those accounts to be in arrears for most of the time.
Would that be fair to the HA's? Could they even operate with such a level of rent arrears?

As it stands most social housing tenants have a credit balance that fluctuates between 5 weeks credit and (almost) zero credit each month.
It isn't like the HA's are sat on a big pot - because it's fluctuating all the time.

TBH most people would prefer not to be in rent arrears.

Murphybear

It would be very unusual for any landlord, social or private, to collect rent payments in arrears.  It is the industry norm to pay in advance.

Our over 60s HA gives us a choice of how often we pay  the rent, weekly, 2 weekly, 4 weekly or monthly, to suit us not them.  

luvchocolate

Murphybear said:

It would be very unusual for aexcny landlord, social or private, to collect rent payments in arrears.  It is the industry norm to pay in advance.

Our over 60s HA gives us a choice of how often we pay  the rent, weekly, 2 weekly, 4 weekly or monthly, to suit us not them.  

Exactly this. Housing benefit is usually paid to tenant unless there are debt to landlord. 
My council pay Housing benefit every 2 weeks and I choose to pay rent weekly as my state pension is paid weekly