LHA Increase to trigger rent increase?

LHA Increase to trigger rent increase?

13:00 PM, 22nd April 2020, About 2 years ago 35

Text Size

I note that the LHA rates have been increased from 1st April 2020 – March 2021. A couple of questions…

1. Anyone know if this is ONLY a temporary measure only till March 2021, what happens after this? Will it stay at the same level going forward, or is this increase only because of Covid-19 and therefore after March 2021 there will be a reduction to another (lower) rate?

2. Are any landlords now upping their rents in light of this LHA increase going forward?

I appreciate the delicacy of the current situation, but I think its a valid question!

Many thanks

Reluctant Landlord



Comments

by Bill irvine

18:45 PM, 23rd April 2020, About 2 years ago

WP
Councils, in general, take a rather laid back approach to this issue and will often simply accommodate the landlord. Whereas, DWP tends to take an arms-length approach, often refusing to tell you anything, unless an APA (direct payment) is in place.
Where payment is being made direct to the landord, just as in HB/LHA, the landlord is obliged to report any change, including an increase in rent to both Council & DWP, although the latter does prefer for the tenant to report the change via their online journal.They should however act on information provided by the landlord.

Bill

by Jo Westlake

21:32 PM, 23rd April 2020, About 2 years ago

The Housing Benefit rate was reduced in 2011. I think at that time it went from the 50th percentile down to 30th percentile. For example in my area the 2 bed rate was reduced from £650 to £585 a month. It gradually went up to £612 and was then frozen for the last 4 years. It has now gone up to just under £680.

I have two 2 beds with low income working tenants both receiving benefit top ups. One has had a rent freeze for 7 years at £630 per month, the other frozen for 4 years at £620. In both cases these rents were substantially below market rate. I've just increased both to £675 which for both tenants is effectively a rent cut as they will no longer need to top it up out if other money. They are both still below market rate.
This is highlighted by the fact the local council have just placed a single parent with one child in a 3 bed I have at £715 a month on the basis that it was cheaper than any of the available 2 beds on the market.

by Prakash Tanna

9:45 AM, 25th April 2020, About 2 years ago

Reply to the comment left by Bill irvine at 23/04/2020 - 18:45
I have recently attempted to inform UC via email of a change in rent and they responded saying that they can only accept the change from the claimant through their online account and have dis-regarded what I told them.

by Prakash Tanna

9:50 AM, 25th April 2020, About 2 years ago

What happens if like in 2011 the LHA rates are reduced again in years to come? Are the LA's obliged to continue paying the current higher amount or would they automatically reduce the entitlement to the lower amount for existing tenancies/claimants? I appreciate any new claims would be based on the then current rates.

by Mick Roberts

10:18 AM, 25th April 2020, About 2 years ago

Reply to the comment left by Prakash Tanna at 25/04/2020 - 09:45This is a bone of contention me & Bill have now, DWP rules/Legislation etc. require Landlords to tell DWP if rent increase, but give no way of letting us know how we do that.
I've gave about 70 rent increases to tenants in the past month & UC are constantly getting it wrong, suspending tenants own money cause they suspect some fraud. Many of the staff know NOTHING of rent increases & think it's a big scandal should the rent go up.
Some tenants aren't putting it on journal, some doing too early when old HB would just put it on system & action when due. UC really are a logistical nightmare. Till they start talking to the very important Landlord who is housing this person, there will be many more thousands homeless.s
All these answers are on Bills website:
https://universalcreditadvice.com/
Well worth the subscription if u have tenants at all on any benefits.
And Bill likes to get his teeth into any misdemanour DWP UC do-As do I, but I'd rather they din't make the mistake in the first place.
Prakash, We & the tenants will be paid the new lower amounts should they go down again. Which is another reason why Shelter needs to learn why Landlords aren't taking Benefit tenants any more, the rules change once you've took the tenant on, we the Landlord has fulfilled our side of the bargain going forward, but the DWP can renegade on their deal & we have to sort the mess out.

by Prakash Tanna

10:35 AM, 25th April 2020, About 2 years ago

Reply to the comment left by Mick Roberts at 25/04/2020 - 10:18
As is always the case, the landlord it at the bottom of the food chain! Interesting, the tenant cannot inform UC up-front of a change in rent on their account. It has to be on the day the effect takes place or after that date, and if it's not after the date they get a message saying 'you have informed us after the change took effect'. So basically, the way the UC system is setup, the tenant has a small window of opportunity to update the change on the date it took place. Whereas, with LA's and HB, as you say, they are able to input it in advance on their system.

If as you state and I agree, they will pay the lesser amount if rates go down, there will need to be another 'pot of money' to pick up the shortfall. Be it DHP or something else as Landlord's will be reluctant to reduce the rents so easily.

Also, I use the email address (UCFULL.SERVICE@dwp.gov.uk) to comply with legislation to inform UC of a change in rent but get the following 'crappy' response ....

Your email has been received into the National Inbox for Universal Credit.
Please note, emails received into this inbox will only be actioned if they are regarding the following criteria:
Debt Relief Orders
Social Rented Sector Validation Forms
Alternative Payment Arrangements
MGP1 Local Authority Forms
Child Maintenance Group
Appeal and Tribunal Outcome Decisions
Award of IIDB
Prisoner Notification
Official Correspondence from Corporate Acting Bodies
Third Party Deduction Forms
For queries relating to Third Party Deductions, please see signposting in your Third Party Deductors literature pack.
If your query relates to a Change of Circumstance relating to housing, please see Housing & UC on Gov.uk; or for Landlord Payment and Schedule queries, please see here.
No other correspondence can be dealt with through this inbox. Please refer to Gov.uk for guidance.
Thank You

by Mick Roberts

11:11 AM, 25th April 2020, About 2 years ago

Reply to the comment left by Prakash Tanna at 25/04/2020 - 10:35
Ha ha Yes,

You do get the crappy responses.
I occasionally get some high up people in complaints phone numbers. Things improve for a few months, I tell em something is wrong, they go away, come back & say Ooh u was right u know. I RUDDY KNOW, I'VE BEEN TRYING TO TELL U IMBECILES FOR 2 YEARS this little easy to solve query that is potentially putting tenants home at risk. AAAAAhhhhh......
And then the phone number changes. And the person moves department.

They give us Landlords an email, yes they will have to talk to the dreaded Landlord, it will cost money, but it will save DWP millions in complaints, the Govt & Councils billions in homeless, & everyone will be a winner.
Neil Couling the Director or UC, I have an email from him to me saying he agrees things would be better with a Landlord portal, & he 'says' he's gonna' talk to me after this Coronavirus, but I'm guessing this is even out his hands, the Director of UC want's a Private Landlords Portal, but we can't have one. Winds me up on the news when the MP's say Landlord's have got a portal, we ruddy haven't, the Councils & Big Housing Associations have one, not us!

Give us Portal & Bill can finally retire cause I really hope he doesn't until UC finally sort theirselves out. Cause without him, I am lost on UC. UC & Licensing are bringing my retirement much more forward & my tenants of 23 years etc. potentially homeless as I can't keep em forever with the battles of UC, UC is really heart attack material as u get older.

These on this page, please start complaining, here is the process which I would be happy for Bill to correct me on if he knows a newer better way last few months:
This can be done from u & or tenant.

If UC have messed up, u MUST complain. Otherwise it could be over a year before u get solved. Get the clock ticking down now.

Email N-EMIDLANDS.CRT@DWP.GSI.GOV.UK (this address for Nottinghamshire)
& put Stage 1 complaint in subject.
In the body of the e-mail you should provide all the details of the tenant, address, NINO, DOB etc. or your landlord reference number, a summary of your concerns (what has happened) and the issues still to be addressed.

If they don’t reply in 15 days, write to: Correspondence@dwp.gsi.gov.uk & put Stage 2 Complaint in subject
And u could just forward your previous email. Saying you have waited 15 working days.

If they don’t reply in 15 working days, you then write to ice@dwp.gov.uk & tell them you haven’t had a reply.
ICE normally say You have to have a referral from DWP. You then tell ICE Mick Roberts said YOU HAVE TO take my complaint on, otherwise DWP may as well never reply if you aren’t going to look at complaint.

You need to start complaining to get the system changed or u could be in same boat next year.

by Prakash Tanna

11:51 AM, 25th April 2020, About 2 years ago

Reply to the comment left by Mick Roberts at 25/04/2020 - 11:11
Thanks for that. It's very useful to know. Fortunately I only have 5 on UC whilst the rest are on HB and so far i've not had any issues with any of them. I have good relations with all my tenants and they co-operate and communicate with UC as and when I need them to. All i ask is that they send me s screenshot to confirm the change has been done. Over time everyone will be transferred over to UC, but the current Covid19 situation may push that back a year or two now, another positive I guess! 😉

by Bill irvine

11:54 AM, 25th April 2020, About 2 years ago

Morning WP/Prakash/Mick

I see you and several other 118 posters, including my PR agent, Mick Roberts, have been expressing the difficulties you encounter, dealing with DWP on the issues of effecting the 30th percentile LHA rates for those tenants that don't report the change to DWP and getting them to acknowledge, you, as landlord, have a right and obligation in some cases, to notify them of the change in circumstances. You’re not alone, believe me!

DWP is consistently wrong, in refusing to act on information provided by landlords AND on insisting changes need to be notified, only by tenants, after the change has occurred, when the legislation clearly requires that notification should be provided during the tenant's Benefit Assessment Period, otherwise, notification made after that date could be considered"late", causing rental loss.

The truth is, you can indeed notify DWP of the rental charge increase, or any other change that has a material effect on the level of award. That’s especially true, where payment of the “housing costs element” is being paid direct to you.

See DWP’s Guidance to Landlords - 10.2 "Changes which may affect or end the Managed Payment to landlord (MPTL)" - https://www.gov.uk/government/publications/universal-credit-and-rented-housing--2/universal-credit-and-rented-housing-guide-for-landlords

It clearly states - “Whilst a MPTL is in place the landlord must notify the department of any changes which a landlord can be reasonably expected to know which might affect the claimant’s entitlement to Universal Credit and the amount awarded.”

A change in rental charge is clearly material and something you’re legally obliged to report, just as an end of tenancy, would also be relevant.

Regulation 38 UC (Claims & Payments) Regulation 38 specifies this obligation to report.

In your case, I’d email the local District Manager and make a “1st Stage Complaint”. You’ll find your nearest DM by examining the undernoted link.
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/416788/jcp-district-managers.pdf

DRAFT Email

Dear District Manager

I write to advise you our tenant Mr/Ms XXXXXXXXX XXXXXXXXXX, 10 Brown Street, XXXXXXXXX, XXXXXXXXX has had a rental increase. His/Her new rent is £xxxxxxx per calendar month and became effective from Xxxxxxx.

To date, I’ve encouraged him/her to notify you of this increase via his journal, so that you can supersede his/her award and pay the new charge, but, he/she’s not cooperating. This failure is causing a shortfall in rent payments, causing rent arrears, which could jeopardise his/her tenancy if the matter is not attended to ASAP..

As his/her landlord, I receive payment direct, so I’m obliged to notify you of any material change in his/her circumstances. A change in rental charge is clearly material. This is required by Regulation 38 and accords with DWP’s Guidance to Landlords.

DWP's own UC circulars, providing Guidance to Landlords make this clear - Paragraph 10.2 “Changes which may affect or end the Managed Payment to landlord (MPTL)” or APA as it’s often referred to - https://www.gov.uk/government/publications/universal-credit-and-rented-housing--2/universal-credit-and-rented-housing-guide-for-landlords

If you require any further information or would prefer a copy of the letter we’ve sent to our tenant, I’ll happily oblige.

Please acknowledge and confirm when you've superseded the award to reflect the new rate?

Yours

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

ENDS

If you experience any push-back from DWP through pursuing this line I'll assist you to prosecute your complaint.

Bill

by SimonF

2:21 AM, 26th April 2020, About 2 years ago

Hi. Make sure you calculate increased rent Vs benefit cap as many tenants will not benefit from the increase to LHA due to the cap. Beware with UC tenants if you increase rent and the total benefit payable is above the cap then the full rent will still be paid if you are receiving direct payments but the excess amount above the cap will be deducted from the tenants allowance. This will most certainly cause the tenants to become upset. So typical government they give with one hand and take with other. There is talk for them to scrap cap especially now due to virus but they have not mentioned yet if they will.


Leave Comments

Please Log-In OR Become a member to reply to comments or subscribe to new comment notifications.

Forgotten your password?

BECOME A MEMBER