Would my sis buying the flat I rent & receive housing benefit for be classed as a contrived tenancy?

kimberly42

I have been chronically ill for 25 years and have been bedridden for the last 11 years. I have privately rented the same one bedroom flat for the last 16 years for which I have always received housing benefit. I have had the bad news that my landlord wants to sell the flat. If my sister and brother-in-law bought the flat with a buy to let mortgage and became my landlord with a tenancy contract, would I still be able to receive housing benefit, or would it be classed as a contrived tenancy and the housing benefit refused? Many thanks. 

Alice_Holt

That will be a decision for the Local Authority. 

It's a decision you can challenge. My guess is that the LA might well see this arrangement as contrived, and you would need to go to tribunal to argue your case that it wasn't contrived as it wasn't designed to take advantage of the housing benefit system.

https://england.shelter.org.uk/professional_resources/legal/benefits/housing_benefit/housing_benefit_claimants_who_are_treated_as_not_liable_to_pay_rent


https://www.housingrights.org.uk/professionals/news/universal-credit-decisions-contrived-tenancies


Does your LA have any suitable sheltered accommodation for rent ? 

born_again

kimberly42 said:

I have been chronically ill for 25 years and have been bedridden for the last 11 years. I have privately rented the same one bedroom flat for the last 16 years for which I have always received housing benefit. I have had the bad news that my landlord wants to sell the flat. If my sister and brother-in-law bought the flat with a buy to let mortgage and became my landlord with a tenancy contract, would I still be able to receive housing benefit, or would it be classed as a contrived tenancy and the housing benefit refused? Many thanks. 

Are they charging you rent?
If so how does it compare to your previous landlord.

poppy12345

The question is, if you didn't pay your rent would they evict you?

kimberly42

Thank you for the replies.

My LA does not have any suitable sheltered accommodation in the area immediately available.   (I am 52). Also I can’t travel as makes my condition worse. I have not left this flat for 12 years. 

They would charge me rent at the same rate as my current landlord. If I didn’t pay my rent they would have to evict me as they couldn’t pay the mortgage otherwise. 

Newcad

I agree with Alice.

The council, or DWP if it's UC Housing Element, may (being cynical probably will) try to say that it is a contrived tenancy.

You point out that there is no increase to what was already being paid as benefits so there is no "contrivance to claim or increase benefits" in any way. The benefit was already being claimed and has not increased.

luvchocolate

Mortgage companies will not usually let you let your property to a family member. 
They would need to see a mortgage broker for a regulated buy to let mortgage 

HillStreetBlues

From Alice's link

There are 2 elements to challenging a decision not to award benefit because the liability is seen to be “contrived”: 

1. You must demonstrate that the letting is on a commercial basis, and 
2. You must show that the intention behind the letting was not purely to claim benefits or increase the amount of benefits the tenant is receiving
   

1,  Buy to let would be on a commercial basis, as you say, if rent isn't paid then no payment for mortgage.
2. Clearly it's not purely to claim benefits, it's to stay in a property you have called home for the last 16 years.

So I really can't see a final decision it being classed as a contrived, as there are other factors in play to show it's not.

Spoonie_Turtle

HillStreetBlues said:

From Alice's link

There are 2 elements to challenging a decision not to award benefit because the liability is seen to be “contrived”: 

1. You must demonstrate that the letting is on a commercial basis, and 
2. You must show that the intention behind the letting was not purely to claim benefits or increase the amount of benefits the tenant is receiving
   

1,  Buy to let would be on a commercial basis, as you say, if rent isn't paid then no payment for mortgage.
2. Clearly it's not purely to claim benefits, it's to stay in a property you have called home for the last 16 years.

So I really can't see a final decision it being classed as a contrived, as there are other factors in play to show it's not.

AND to not make their health horrifically worse by having to move.

peb

Sadly as someone has said that will be a breach of mortgage conditions.  No lender I've come across will permit it.

HillStreetBlues

Bit of info about B2L to family
https://www.mortgagesforbusiness.co.uk/news-insight/2022/january/can-you-rent-to-a-family-member-under-a-buy-to-let-mortgage/