Shelter’s Income and expenditure figures highlighted13:57 PM, 4th February 2019
About 2 weeks ago 35
Getting a deposit from tenants with no assets has always been a problem, but for those of us who let to DSS tenants we are left open to the risk of criminal damage and rent arrears if the tenant turns out to be a rogue/bad tenant. For landlords who let to professional tenants, this is not such a problem as a deposit is taken and the landlord can recover debts via seizing goods (via bailiffs) or an attachment of earnings order. However, if the tenant is unemployed and has no assets, then such recovery is not possible, so I was wondering if there is some way of taking a deposit that is paid over time? – Let me explain:
Could a property be let to a DSS tenant on the basis (written into the AST) that any amount received from the tenant, via any source (Housing Benefit, DWP deduction, cash payment, third party, etc) would be held as a payment on account towards a deposit until it reaches £1000 at which point it would become a deposit and be paid into an approved deposit protection scheme? Such a deposit would be repayable to the tenant upon the ending of the tenancy less any amount for damage or rent arrears etc.
If this could be done, the tenant would have paid a refundable deposit which the landlord would have protected in the DPS (or similar scheme), but the tenant’s rent account would be showing as being in arrears (as the Housing Benefit received would have been used towards the deposit). The Housing Benefit Department always say (when a tenant spend the money instead of paying the rent), that it is the tenant’s choice how they use the HB money, so if they agree to use it as a deposit then that is their Right.
This would create a situation whereby if the tenant does not cause damage then the deposit will be refunded at the end of the tenancy. However, if the tenant does cause damage or needs to be evicted due to anti-social behaviour, there would be arrears on the account so they could be given 14 days notice under s8 ground 8, and could therefore be evicted quicker (i.e. quicker than using the s21 process), and the deposit could be used towards the cost of repairing any damage done.
Just wondering if this could be done, and if not, why not?
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