Call for U-turn on Plan to Pay Rents to Tenants

by Property118.com News Team

14:57 PM, 21st September 2011
About 9 years ago

Call for U-turn on Plan to Pay Rents to Tenants

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Call for U-turn on Plan to Pay Rents to Tenants

"Housing associations unite to try block changes"

Major housing organisations in the private and social rental sectors have joined forces to fight the government proposals to pay housing benefits direct to tenants.

The move affects the way millions of tenants are likely to pay their rents – especially the 20 per cent of tenants who have never had to budget for housing costs before.

The concern is tenants will spend the money on other living costs and lifestyle expenses rather than pay rent, leading to a massive amount of rent arrears.

The proposal is included in the Welfare Reform Bill, which has passed through a second reading in the House of Lords.

Lord Freud, the minister responsible for seeing the bill through Parliament, said: “Universal credit payments must include payments for housing costs. This means benefit claimants have to manage their own finances – their full finances – so when they do find work it’s easier to leave the safety of the welfare system. I am absolutely committed to making a single universal credit payment, wherever possible.”

He did recognise landlords were worried about how the changes might affect their cash flow.

“I know that this is a significant change for the social housing sector and I am fully conscious that housing benefit income steams are a vital component of housing finance, particularly in terms of funding of new housing,” he said.

Research suggest tenants would prefer housing benefits to be paid directly to landlords.

A survey of 1,000 tenants by the National Housing Federation (NHF), found 93 per cent favoured rent going directly to their landlord.

“We would like the government to guarantee that tenants should have a choice over whether or not their housing benefit should be paid directly to their landlord, and to accept an amendment to the Welfare Reform Bill in the House of Lords that will ensure this can happen,” said a statement from the Council of Mortgage Lenders, one of the organisations lobbying for the amendment.


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Comments

Roy Hegarty

12:58 PM, 29th September 2011
About 9 years ago

All the tenants that have housing benefit in our properties do spend the rent money on other things like wide screen T.Vs.etc. We are now in a position that Landlords do not want to take on tenants on DSS. The council told me it is their money so they can spend it on what they like, go down the pub and spend it all if they want to!! Now we have to wait until they are 8 weeks behind for the council will sent the rent to us, but the trouble is they bring in some money just before the 8 weeks are up !!!! leaving us to wait until they do it again.

11:48 AM, 30th September 2011
About 9 years ago

I have had this problem in the past here in Scotland, it is a nightmare to say the least. The way I found round it was put all my tenants through a charity for the homeless (Seascape Ayr) http://www.seascape-ayr.co.uk/ We have arranged with a Glasgow-based financial
organisation to open current accounts on our clients )
behalf. We then apply for their LHA payments to be
paid into the client ) s current account on a 4-weekly
basis and we set up a standing order to forward those
payments on to the landlords the day after they are
cleared. Each client signs a mandate agreeing that
Seascape will receive and manage their account details
statements. Each client also agrees to relinquish
their right of access to the funds in their account.
These accounts are set up and managed under
FSA Regulations.
this system works very well and has completely done away with arrears. I hope this can help my fellow landlords.

13:49 PM, 30th September 2011
About 9 years ago

I am having so much trouble with this system of giving the money to the tenant.I don't have 1 tenant who pays me before they've spent most of it on other things,usually their mobiles or SKY.I have altogether 7 tenants who get housing benefit, but the only ones not in arrears are those on the old system, where I still get payment from the councils.I deal with 3 councils & each one has a different system too.

16:25 PM, 30th September 2011
About 9 years ago

Our local council operated [and I believe still does] this system years ago. and half my DSS tenants fell into arrears. I had to evict two. One, when visiting the housing department for support in finding alternative accomodation was told that he'd have plenty of time to get something else himself as it would take us at least three months to get notice served and meanwhile he woiuldn't need to pay any rent so should be able to save a deposit. With arrears and refurbishing the property after they left I was almost a years rent out of pocket. Not surprisingly most of the accomodation adverts in the local newspapers state No DSS, children under five or pets. The Council's Housing Benefits sections policy has made a significant contribution to accomodation shortages for DSS tenants. If this becomes a national policy the impact on DSS tenants and there landlords will be catastrophic.

Mark Alexander

16:31 PM, 30th September 2011
About 9 years ago

10:27 AM, 3rd October 2011
About 9 years ago

Who ever thinks it is a good idea to give tenants money to pay their rent should me sent to a mental institution.
No wonder the world is in such a financial mess with IDIOTS coming up with such an idea and being paid a salary from the taxpayer to boot,
What a complete bunch of morons

chris howells

20:08 PM, 8th October 2011
About 9 years ago

had in tenant in shared accommodation who changed jobs, he applied for housing benefit which was paid to him, did not receive a penny from him for 7 months until I finally got him out.The reason he refused to pay was as a result of that I would not give him a larger room that had become vacant until I was sure that he would clean up the house. The other tenants were tidy but he was not.So he got another job claimed housing benefit and did not pay for his room gas, electric etc. He also contacted the private sector housing office who sent me a letter to state that i was not to visit the property without informing him first even though it was on individual contract and I had 2 rooms empty. I no longer do these they are too much hassle. The joys of being a landlord but at least I have learnt from my mistakes now I use a letting agent much simpler


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