16:34 PM, 11th May 2021, About 3 years ago 1
Around six million people across the UK are currently receiving Universal Credit, a financial benefit payment provided by the Department for Work and Pensions (DWP) intended to help those out of work or on a low income with daily living costs.
As the pandemic continues to impact the economy, financial uncertainty is undoubtedly set to become a reality for many more households, particularly as the furlough scheme draws to a close on 30 September 2021. This means more landlords will find themselves with tenants who are having to rely on benefits to help pay their rent.
The good news is that to make sure claimants get much-needed access to cash quickly without worrying about repayments, the DWP has now implemented changes to Universal Credit advances.
When a person makes a new claim for Universal Credit they normally receive their first payment seven days after the end of their first Assessment Period – this is a rolling one-month period. For example, if a person claims on 10 May, the Assessment Period will run from 10 May to 9 June, then receiving the payment seven days later. Effectively a five-week wait, which has been heavily criticised as it leaves many facing a tight squeeze to get by without running out of money at a time they are already facing financial hardship.
However, claimants can apply for an advance if they are struggling and, for example, cannot afford to pay their rent, buy food or heat their home. This means claimants could receive their full monthly benefits ahead of the official payment date and then pay back the advance a bit at a time from your future Universal Credit payments, or by other means if they then no longer receive Universal Credit.
This is where the big changes come in. Instead of repaying an advance within 12 months, the DWP has extended this to 24 months – if claimants applied after April 12, 2021.
Landlords, if your tenants’ financial circumstances have changed, and they now need to claim Universal Credit, talk to them about their options of applying for an advance or possibly setting up an Alternative Payment Arrangement enabling the housing element of their UC payment to be paid directly to you.
Universal Credit claimants can enquire about an Advanced payment through their Jobcentre Plus work coach, through their online account or by calling the Universal Credit helpline.
Sherrelle is an independent consultant and is recommended by Property118 for landlords who require professional advice and assistance in regards to dealing with Universal credit related matters