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  • FIRST POST
    • MSE Martin
    • By MSE Martin 18th Dec 06, 4:20 PM
    • 8,111Posts
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    MSE Martin
    MONEY MORAL DILEMMA. Should Jenny kick them out?
    • #1
    • 18th Dec 06, 4:20 PM
    MONEY MORAL DILEMMA. Should Jenny kick them out? 18th Dec 06 at 4:20 PM
    This week's Money Moral Dilemma

    Jenny's a landlord with a buy-to-let property and a single parent family has been renting for nine months. They've always paid on time and been model tenants. Unfortunately, three months ago the tenant lost her job, and hasn't found another. She hasn’t been about to pay the rent for two months and is speaking to the Citizens Advice Bureau about help. Jenny has a mortgage on the rental property and, while she can keep afloat, life is more difficult without the rental income.


    Click reply to enter the money moral maze


    Also read last week's MMD: Should Janet pay for John?





    PS. And just to confirm this is an entirely hypothetical situation. Each week in the email I will be asking those questions. And yes, the lack of detail, the phrasing, all of it is deliberate to invoke debate (nice debate too). Enjoy the money moral maze.









    Last edited by MSE Martin; 20-12-2006 at 12:49 AM.
    Martin Lewis, Money Saving Expert.
    Please note, answers don't constitute financial advice, it is based on generalised journalistic research. Always ensure any decision is made with regards to your own individual circumstance.

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Page 1
    • skylight
    • By skylight 18th Dec 06, 4:35 PM
    • 10,424 Posts
    • 16,875 Thanks
    skylight
    • #2
    • 18th Dec 06, 4:35 PM
    • #2
    • 18th Dec 06, 4:35 PM
    The single parent family are entitled to Housing Benefit. This process may already be inhand and the council is taking time to process the claim (as it happened with me - took 3 months going years back!)

    But.

    The Buy-to-let is still a business. Unless the tenant can prove that they have made a claim for housing benefit and that the rent will be forthcoming, then start eviction proceedings.

    Although, business is business, I personally would not have the heart to start proceedings this week and would wait until the new year.
  • fififofum
    • #3
    • 19th Dec 06, 1:33 PM
    • #3
    • 19th Dec 06, 1:33 PM
    There should be a clause in their contract which outlines what happens in the event of non-payment/job loss/DHSS payment etc.

    My sister was asked to leave (given correct notice period) even though she had paid everything uptodate but advised them was now going to be under DHSS as she was out of work. She went and found a job somewhere else and a houseshare and is going better because of it and guess what still hasnt had the money she was owed for the time she was entitled to benefits 3 months delay in claim.
  • adagio
    • #4
    • 19th Dec 06, 9:36 PM
    • #4
    • 19th Dec 06, 9:36 PM
    The single parent family are entitled to Housing Benefit. This process may already be inhand and the council is taking time to process the claim (as it happened with me - took 3 months going years back!)
    by charlotte664
    Indeed and Council Tax Benefit as well. Write a letter before action immediately after Christmas. Starting possession proceedings will only add to tenant's debt (court fees). Explain to tenant why and tell her to present the letter to Council HB office. This may concentrate their minds since with children involved they would have to rehouse tenant were she to be evicted and that is the last thing they would want.
    Last edited by adagio; 19-12-2006 at 10:08 PM.
    • CheeseOnToast
    • By CheeseOnToast 19th Dec 06, 10:51 PM
    • 352 Posts
    • 52 Thanks
    CheeseOnToast
    • #5
    • 19th Dec 06, 10:51 PM
    • #5
    • 19th Dec 06, 10:51 PM
    I just *couldnt* kick them out if I could stay afloat, as long as I was sure I'd get my cash in the long run..........
  • rachhartlepool
    • #6
    • 19th Dec 06, 10:53 PM
    • #6
    • 19th Dec 06, 10:53 PM
    The tenant could ask the local authority HB dept for an interim payment as well, to ensure that she is able to sustain her current accommodation. A letter from Jenny explaining that she is likely to kick them out would definately help, assuming that the claim went in when it should have done...
  • boblevin
    • #7
    • 19th Dec 06, 11:06 PM
    • #7
    • 19th Dec 06, 11:06 PM
    This is difficult for landlords who care, however, Jenny bought the property as an investment and has to stay focused on that. It is most likely that Housing Benefit will assist the tenant with her rent and council tax. In the event that the tenant is not eligible for these benefits then Jenny should take appropriate action to ensure that the tenant vacates the property.

    Just to explain one of the reasons why the tenant may not be able to pay Jenny by claiming Housing Benefit. Everyone has a past. Some people claim Housing benefit when they are not entitled to it. When discovered one way of the council concerned recovering this is by withholding payments the claimant subsequently become entitled too. This can have a seriously adverse effect on landlords who accept direct HB payments, as if the council subsequently discover that the tenant has previously received HB by means of a fraudulent claim, the council will charge back the the unwitting landlord the whole amount owed to them by the tenant to the extent that they have made payments to the landlord. This could be months of rent. Furthermore, the landlord still has the tenant but no rent until they gain possession. I would also mention for clarity, that a council can recover HB on behalf of another council.
    • Paul_Herring
    • By Paul_Herring 19th Dec 06, 11:08 PM
    • 6,454 Posts
    • 3,169 Thanks
    Paul_Herring
    • #8
    • 19th Dec 06, 11:08 PM
    • #8
    • 19th Dec 06, 11:08 PM
    Sounds a bit like my current tennants (but there are differences) - they started claiming HB beginning of November but I've had no rent off the council - there's no way I'm kicking them out over christmas though - they have 3 kids (one about a month old,) and another difference, the HB only covers some of the rent - they've been paying their part already.
    Conjugating the verb 'to be":
    -o I am humble -o You are attention seeking -o She is Nadine Dorries
    • NeilW
    • By NeilW 20th Dec 06, 7:26 AM
    • 137 Posts
    • 68 Thanks
    NeilW
    • #9
    • 20th Dec 06, 7:26 AM
    I'm actually doing this right now.
    • #9
    • 20th Dec 06, 7:26 AM
    As it happens I'm just doing this.

    Yes, the tenant should leave and the landlord should evict. Why? Because if the landlord evicts then the local authority has a statutory duty to rehouse the family, whereas if the family leaves of their own accord they are 'intentionally homeless' and could end up in cardboard boxes.

    In our case the family have tried their best with Housing Benefit and got nowhere. Their attitude was quite frankly alarming (I spoke to them and got the usual 'Data Protection' excuse) and they were offering this poor girl just £44 per week towards her rent even though she had a small child and had got herself up to her eyeballs in debt just because she felt she should pay her way even though she had lost her job.

    I found out exactly where she should go in the council, used the excellent Shelter website to write out a script for the girl and suggesed she speak to the Citizens Advice Bureau to see if they can help strongarm the council. When the council and their housing associations have written to me I've written back stating that she is welcome to stay if one of the organisations will meet her rent.

    Our tenant is a lovely girl, but she is not strong-willed and not good at pushing her point. The sad thing is that the safest way for her to secure her housing going forward would be for her to get banged-up with another kid. There are several other tenants in the same block with more than one child, all fully funded by the state.

    I think I've negotiated the moral maze as best I can. You have to be both selfish and benevolant at the same time. The state will try and shift its responsibility onto anybody else who is prepared to accept it. So you have to be hard and press for eviction. At the same time you can use what knowledge you've built up about the patchwork mess of social housing to guide them to the people that have a legal duty to deal with the problem and those people who can help the unfortunate individual enforce that legal duty.

    It's been fun, believe me.

    NeilW
    • freebird65
    • By freebird65 20th Dec 06, 8:25 AM
    • 1,731 Posts
    • 2,682 Thanks
    freebird65
    I have a situation too. In my case the tenants have given me endless sob stories and promises of rent money from HB now he's lost his job. I was all patience and friendly understanding.....and where has my helpfulness got me? Over £2K in arrears and no danger of ever getting it back. Oh and now they tell me there'll be no more money because they have to pay for Christmas presents and a holiday!!

    And softy that I am, I still can't bring myself to give them their eviction letter over Christmas, even though I don't have any spare money to pay the mortgage in the meantime.

    The next tenants will get a hard-hearted moo!
  • viktory
    The tenants should have applied for HB immediately as my understanding is that HB claims are processed (and backdated) from the date of the claim. Therefore if they didn't claim immediately then that money is lost.

    As the landlord, if it were me, I would want to see evidence of a HB claim. If a claim had been lodged I would hold fire on eviction proceedings. If not, then I would serve a notice in the New Year.
    • golddustmedia
    • By golddustmedia 20th Dec 06, 9:36 AM
    • 796 Posts
    • 374 Thanks
    golddustmedia
    In the new year I shall become a landlord myself and the sad fact is that I would have to kick them out, or at least give a letter of intention to do so. If I found I was not getting any rental income it would not take long before I would be in arrears on the mortgage of the buy to let which puts my family home at risk.

    It's pretty much a self preservation thing, if I didn't kick out the tennant I'd lose the property to the bank anyway and since my one is to be secured on my own home I'd risk becoming homeless too.

    It's not a nice thought but at the end of the day people are responsible for their own wellbeing and living within their means.

    Someone above noted they are kicking out tennants who "cannot pay" yet the tennants are having a holiday and buying presents. Perhaps it's only me that as a tennant would feel responsible for my rent above my own christmas enjoyment?
  • Herb
    If there has been no application for Housing Benefit then start eviction proceedings. The time of year is irrelevent - why should Jenny pay for her tenant's Christmas.

    There is a 13 week rule regarding the backdating of Housing Benefit and even if it is granted there could be a large shortfall each month.

    Action should have been taken as soon as she became aware of the problem.

    If the tenancy was not renewed at 6 months then Jenny need only give 2 weeks notice using a Section 8 - this might focus the HB office to process the claim.

    Although we don't know for certain, it is possible (and in my experience- likely) that the tenant will spend her normal Christmas spending - but will make no effort to pay Jenny.

    Jenny will be paying for the tenant's Christmas - and Jenny is unlikely to get the money back.
    • Ebenezer_Screwj
    • By Ebenezer_Screwj 20th Dec 06, 10:50 AM
    • 420 Posts
    • 229 Thanks
    Ebenezer_Screwj
    No Prisoners
    They should be evicted without delay. The horrendous burden of taxation upon the individual means every man for himself.
  • coolpaprika
    This is interesting for me as I'm considering buying a buy to let property. What I've learnt is not to have a family with young children as I'm a sucker for a hard luck story!
    Having said that, I wouldn't evict immediately. Housing benefit is the right way to go and I would help with the applications as I know how daunting forms can be to fill in. I think I would suggest claiming immediately on knowing about the job loss. Losing a job is bad enough on it's own without also losing your home whatever time of year. I really don't think I could put anyone on the street or temporary accommodation without exhausting all possibilities.
    • november
    • By november 20th Dec 06, 11:34 AM
    • 607 Posts
    • 395 Thanks
    november

    Yes, the tenant should leave and the landlord should evict. Why? Because if the landlord evicts then the local authority has a statutory duty to rehouse the family, whereas if the family leaves of their own accord they are 'intentionally homeless' and could end up in cardboard boxes.
    by NeilW
    Just for information and not saying its the landlord's responsibility (as it isn't) but -

    If the landlord evicts because the tenant has rent arrears the chances are the local authority may find the family 'intentionally homeless' i.e. homeless through their own fault. They then have NO statutory duty to rehouse. The only statutory duty is Social Services duty to the children and case law has shown that it is 'reasonable' for them to take the children into care rather than house the family.

    - - - - - -

    Even with a business head on the landlord has what has previously been a good tenant. Keeping good tenants is good business sense as the next potential tenant is an unknown plus you have a possible gap between tenants.

    The tenant has contacted Citizen's Advice. It doesn't say if the tenant knew and is awaiting housing benefit (seeking advice with that) or didn't know they could claim (some people who have never claimed benefit don't). In either case Citizen's Advice will help either by advising the tenant on an interim payment or by helping the tenant claim housing benefit and put in for a backdate if there are any special reasons they didn't claim before.

    I think if I were Jenny I would do the following:

    1) If I had never had a PTD done I would ask the tenant to get one done so I knew if the tenant was likely to have to pay any 'top up' on the rent. Or use some other method of finding out what housing benefit may consider a reasonable rent for that family in my property. If it looked like there may be a top up I would ask the tenant to start paying that and any arrears on that. Stops arrears accumulating should housing benefit not pay the whole rent and demonstrates tenant responsibility (which it says this tenant has).

    2) Issue a Section 21 which gives 2 month's notice. That means that I can retract it if rent is in payment by then (which it should be) but limits my losses if it isn't while setting a useful deadline. Make sure the tenant knows why I am doing this and that it doesn't necessarily mean they will have to leave IF rent is in payment by the deadline but that I will reassess and enforce it (through court if necessary) if no payments are made by then. Reassess is because e.g. hb payments may be made by then but the tenant still have arrears if no hb backdate was possible in which case I would expect the tenant to make and keep to arrangements to pay off the arrears.

    3) I would expect the tenant to keep lines of communication open with me and let me know what is happening.


    'Kick them out?' You have to serve some form of notice and then take them to court anyway. It seems sound business sense to give someone a chance to claim the benefits to which they are entitled and therefore increase chances of getting the arrears paid as well as being fairer to a 'good tenant' who unfortunately lost her job.
    I live in my own little world. But it's okay. They know me here.
  • Catonine
    I have a friend who is a landlord, and she has found that the housing benifit office move their bottoms faster if you serve the family with a letter saying if money has not been paid by X date they will be evicted.

    Its not a great solution, but it may well get results
  • Darknesslass
    This is a difficult one BUT.....

    The family should have claimed housing benefit straight away....

    I'm sure if I remember right while you are claim housing benefit any arrears of rent CAN NOT be counted if it's the fault of late housing benefit.

    Rent has to be 2 months in arrears BEFORE a court will take action, THEY also allow the deposit to be used as a months rent. SO the tenent is really allowed upto 3 months arrears before the court will action.

    The tenent can ALSO file appeals against the section, so it could be very costly for the landlord.

    I'd want to see proof that housing benefit has now been claimed and contact housing myself. If they confirm it will be sorted and then paid, I'd let the family stay UNTIL the end of their lease.
  • HercsDad
    Sorry, but I have to say this is not a moral dilemma, at all – she has to go. She owes two months and the HB may not backdate, so where does she get that from? The HB system is complicated and slow, so it’s likely to be another month before any money arrives.

    I am a landlord, a perfectly fair one, and I’ve had plenty of good tenants, but also some bad ones. Did you know that even if a tenant instructs the HB to pay the money directly to you, they can revoke that at any time? So, how’s this for great…..the tenant pockets the money and you still don’t get paid. This happened to me.

    Also, the HB may not pay all of the rent – so where does the rest come from?? What about insurance? Many buy to let insurance policies don’t cover the place if the tenant is on HB.

    She needs to issue a section 8 notice for non payment AND a section 21 for simply wanting her place back, NOW. Did you know the s21 means you have to give 2 months notice regardless of any “contract”? You CANNOT just “kick someone out”.

    One tenant I had defaulted constantly and after many broken promises, I told him to leave. He went to HB office and THEY told HIM, and I kid you not….”just stay there – he can’t make you leave and it’ll take months before the court get you out”.

    Gives you faith in the system doesn’t it when a civil servant advocates such action.

    My parents are currently landlords and good honest people. To cut a very long story short, they let in the summer to an Iraqi doctor. Turns out after she was in that she is actually barred from practising by the GMC following a conviction for racial violence.

    Unbeknown to my parents, she also moved in her mother and brother.

    Then she stopped paying the rent.

    Then we found out why…..she is on remand for more violent behaviour against a pregnant woman and likely to get a custodial sentence. The mother and brother, who are sponsored to be in the country by the doctor, are now living in the house, paying no rent and both my parents are now becoming ill with the stress and worry about how they can recover the house, let alone the cash.

    Sorry, but like I say – to Jenny, this is a no brainer…….
    • nej
    • By nej 20th Dec 06, 4:12 PM
    • 1,504 Posts
    • 774 Thanks
    nej
    Jenny is not a charity and must kick out the tenant.

    If the tenant can get the local authority to pay the rent, then fine. One of my tenants is doing that now (similar situation - her boyfriend left her, and she has to look after her 6 month old baby). The local authority is going to pay the rent, so that is fine.

    We did have a situation with a single guy in another flat who stopped paying because he lost his job. The authority paid some of the rent in this instance, but not all of it. We had to evict him.
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