What happens next if Tenants now start to claim Housing Benefit?

by Readers Question

7 months ago

What happens next if Tenants now start to claim Housing Benefit?

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What happens next if Tenants now start to claim Housing Benefit?

I’m currently experiencing a situation that is new to me and would appreciate some good advice. My tenants are expecting their first child and have recently lost their jobs. housing benefit

They told me in advance that they wouldn’t be able to pay this month’s rent and have made a claim for housing benefit.

While I am wholly sympathetic to their situation I am also highly leveraged against the property. I do not want to burden them with any more stress, but I do need some answers.

Could any experienced landlords give me some advice on what to do next or what procedures to follow?

Many thanks in advance

John

Comments

Neil Patterson

7 months ago

Hi John,

Very unfortunate for your tenants and you are right they are probably very stressed.

Do you know if the Housing Benefit will be paid directly to you or are you in a Universal Credit area where it is paid directly to the tenant unless they fall into 2 months arrears?

One thing to remember if you are paid directly by the council is that if there is an error on the application and there has been an over payment they will request/demand it back from the landlord.

Monty Bodkin

7 months ago

You need to be proactive -if you go under you are doing your tenants no favours.
Get your tenants to sign a letter allowing the council to discuss their claim with you.
Then ask the council if a claim has been made, how far it has progressed and if any payment has already been made. Keep on at them.
Look up 'Discretionary Housing Payment'.
Consider if you want direct payment a condition of keeping the tenancy.
Look up the LHA rate they are entitled to, does it cover the rent?
Do you need to inform your Rent Guarantee Insurance that the rent is in arrears?
Same with Guarantors, can they help? If you don't have one, can your tenants now provide a guarantor?
Consider using the deposit for the arrears (with the tenants consent).
Investigate the section 21 procedure and consider starting the long process for if (when) things go awry.

john glynn

7 months ago

Reply to the comment left by "Neil Patterson" at "18/01/2017 - 11:02":

Hi Neil, Thank you for your reply. I sent a polite email several days ago with some questions regarding their claim but as yet I haven't received a reply.

john glynn

7 months ago

Reply to the comment left by "Monty Bodkin" at "18/01/2017 - 12:14":

Hi Monty, Many thanks for taking the time to answer my query. I sent a polite email several days ago with some questions about their claim but I haven't had a response yet.

Jay James

7 months ago

Given the experiences of many on this site with Housing Benefit, you need to evict your tenants now.

Luk Udav

7 months ago

Reply to the comment left by "Jay James" at "18/01/2017 - 18:28":

The LA where I have most houses is absolutely appalling. There is no point in sending **polite** emails. The couple and you need to get on the phone to them every day, several times a day in their case as they'll presumably have more time than you. To get the LA to act you need to tell them you will start the eviction procedures immediately My LA won't talk to you in person; maybe yours will. They use any excuse to delay - I suppose morale is low with the massive cuts to local government.

It's horrible having to do this. You sound like a good chap so keep the tenants informed as to what you are doing as working together will achieve better results.

Monty Bodkin

7 months ago

Reply to the comment left by "Luk Udav" at "18/01/2017 - 18:44":

@John,
Wot he said.

Thom Hill

7 months ago

If you are going to contact the LA, you really must provide signed authority to discuss the matter. Otherwise they're very unlikely to talk to you. Also, making sure that you are talking to the right department is important because the departments don't usually interact very well. Phonecalls and letters normally work better than emails unless you know exactly who needs to get the email.

You will want to check the local housing allowance. A couple without a child are entitled to the one bedroom rate. When the child is born, the two bedroom rate will apply. Use this: https://lha-direct.voa.gov.uk/search.aspx

If, say, the LHA is £500 per month and the rent is £850 per month, then obviously there is cause to worry. If the LHA is £500 and the rent is £550, then everyone can probably manage once the claim is up and running.

You also want to be very clear on whether they are in a "full service" Universal Credit area. If they are, then the LA has nothing to do with it and the DWP will manage the claim. If this is the case, then you have a rocky road ahead.

Gary Dully

7 months ago

You asked what we would suggest.

Well what your tenant really means is that they has a nice Xmas at your expense.

Since George Osborne reduced LHA rates, you are playing a high stakes poker game by renting to LHA tenants.

So after believing what defaulting tenants told me for 2 years and nearly bankrupting my bank account, I was told by a smarter person than me to stop being a sentimental old idiot.

Unless you have 5 months of surplus rent in your bank account, for each LHA tenant, you can't afford to take any on as a tenant.

I didn't like the advice, but it was sound, because it was my distraught wife saying it.
As I missed my first mortgage payment ever to The Mortgage Works

So I'm going to return the favour and give back to the World...

Here goes...
Before starting this you should realise that the court system is rigged against you with its process procedures and dates on notices, but your not at this stage yet.

LHA claimants rarely have any assets, and neither will you in a very short space of time.
They are going to drag you down the financial drain if you let them.

Firstly, stop,being sentimental, you pansy sniffing excuse of a businessman. This is a business! (Tough Crowd), grow up!

Secondly, their rental agreement is with YOU, not the benefits office.
As far as you are concerned, benefits do not exist and are a fanciful dream dreamt up by Jeremy Corbyn and Shelter to bankrupt you and provide mobile phones and nice things to the work shy.

LHA and UC is the last bastion of a lying, conniving tenant who can't get of their backside and get a part-time cleaning job to pay towards the bills.
They are for woman with polysystic ovaries and fat arses and for men with bad backs, problems with biPolar and new identities.
(Vote UKIP)

I reckon that thieving prick just bought Liverpools away kit and trainers for the kids 2 weeks ago, it's all a f**king lie you stupid sh*t and you fell for it.
(That's right,my wife had lost the plot and she said it), so it's probably happening to you.

Her view is that Landlords have little rights when dealing with scam artists.

Do you want to do this legally?
Good for you, brace yourself, your going to learn a lot in the next few weeks.

Here we go.....

Issue a warning letter for arrears, demanding immediate payment.
(You won't get it)

7 days later issue another that says Final Demand at the top and give them 7 days more.( You still won't get it)

Issue a Section 8 notice on Grounds 10 and 11 as soon as the first demand date is missed and a section 21 notice if possible to back you up.

Fire a letter to the council and insist on Direct Payment for the rent and send a copy of the section 8 notice.
Tell them that the Council are funding everything everything except the rent and they will have to house them in future and you won't consider any further referring from the Council ever again.

Tell them if you issue a summons you won't be housing them anymore, regardless of the outcome.

If they are 8 weeks/ 2 months in arrears, you can go for grounds 8,10 and 11 on the section 8 notice.

At the expiry of the section 8 notice, threaten them one last time with eviction through the county court. ( you might now get payment promised by the council, but doubtful).

Issue County Court Proceedings against them and by the time you are in front of a judge, you will probably have about 16 weeks of arrears to back you up.
At which point the section 21 notice may have matured and you could issue a no fault eviction through a court, with that.

Whatever else happens, you have got to get them out of your property legally.

Get them out of that property before they drive you into mortgage arrears, promptly followed by a screwed up Credit Score, which will destroy your ability to refinance or finance future purchases.

The eviction process could take you up to 5 months or longer, so better to start now.

If they haven't even started a claim yet,

1. They are stringing you along
2. They think you are a mug, ( because you are), but so was I.
3. They have absolutely no incentive to help you or their situation, because you are familiar with them and they will treat you with utter contempt, as they appreciate all your sympathy.

They will describe you as a bastard landlord within weeks, so act like one.

Watch Slum Landlord and Tenants On Benefits etc and educate yourself on what happens to sentimental landlords.

Once they make their claim, they probably won't get paid for a up to 2 or 3 months and if they get paid directly as with Universal Credit, they will spend it on everything except the rent.

Stop listening to your sentimental side of your brain and ask what a local money lender would do to them, chances are they are already thinking about using one, so you definitely won't get your money.

Well you can't do that, can you?
you don't have a consumer credit licence for a start.

So stop thinking they will eventually pay up, because they probably won't, they can't, and they will spend their backdated payments before you get a sniff of it.

Get them out of that property before it's too late and get rid of all your future applications that ask will you accept tenants on benefits, because you ain't rich enough.

I wish you well, sincerely I do.

john glynn

7 months ago

Hi Gary, Thanks for your advice. My tenants are eight months into a twelve month AST. They have always worked and always paid their rent on time. They are not your typical benefits basket case. I have always insisted on working tenants and will never accept tenants on benefits hence my call for advice for the situation I am now in. I am certainly not sentimental when it comes to money and I fully realise the problems that lie ahead of me and accept that they will have to go. With regards to your advice, after issuing the section 8 do I have to wait until they are two months in arrears before I issue a section 21? Your timescale of 16 weeks also fits in with their remaing contract term.
Regards,
John.

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