Universal Credit trial increases arrears by a factor of seven!

In cases of people in receipt of benefits, I always ask for a guarantor

Welcome, Duncan Forbes of Bron Afon Community Housing to the private landlord's world............... You still have far greater benefits & far, far, fewer problems than us.

We had to use our own personal capital to purchase properties, while housing associations were given properties and huge sums of money by government to buy up properties in the previous recession. We don't have the benefit of not-for-profit status and we most certainly don't pay ourselves the six figure salaries some housing association cheif execs do. We don't get company vehicles to run around in and could never afford the brand, spanking new vans I've recently seen employees of at least two housing associations using. As a collective, we probably house more people then the housing associations, yet we face constant criticism from them and other "do-gooders", are a target of every government for taxation and legislation, plus face often totally unfounded negative "landlord from hell" press because of the odd bad egg in the landlord business. If they are bad - TAKE THEM TO COURT, that's where they belong.

I have been a landlord for more than twenty years and have only ever had to evict one tenant (and that was in the early days when I was soft and green). I've had tenants on housing benefit paid directly to them, one of which was employed from a job I cut out of the paper for him after 3 years lazing around. Pester power works and maybe you and housing association staff should do a great deal more than just collect rents for their tax-free status.

We all have the same problems with regard to collection of rents & arrears and I absolutely know from bitter experience that the way to collect arrears is to not allow them to come about in the first place - I run a very tight ship as it's my own time (and money !!!), I spend on credit control - I don't have the advantage of teams of staff around me, so I say to you Mr Forbes - be proactive, get out of your nice, comfy cheif execs chair, get into your posh shiny new company car and personally visit those tenants in arrears to see how the great unwashed live. Put it to them that whilst you don't want to evict them, you will personally be issuing the eviction papers within days unless they immediately address the situation and continue to keep on top of a repayment plan or they most certainly will be evicted. While you are visiting them, take a look at the nice big colour TV they have recently bought, the bottles of wine and spirits on the table, their new iPhones & iPads and the piles of toys their children have that they have spent the rent money on. Perhaps if they say their relative bought them you could suggest that instead of their relatives buying those things they could help keep a roof over their kids heads with the money instead.

Of course, there are genuine cases but these are very, very, few and far between - most are simply feckless and need a solid kick up the backside as most landlords well know from experience. If, as our society does, you tell claimants hat the government HAS to house them even if they are evicted and allow them to fall into arrears without immediately doing something firm and solid about it your average feckless individual will naturally spend the rent money on pleasures rather than the roof over their head because they know they will always be re-housed.

Mr Forbes, maybe if you took a large cardboard box with you and suggested that this could be their new home in a few weeks time unless they paid up, they might just get the message.

Of course, it's not your money any more than it is your tenants, so why bother? It's so much easier to continue blaming the system, after all - it's a vicimless crime isn't it ??

Signed - a victim (or tax payer if you prefer).

PS - Sorry for the rant but I'm so sick of hearing stories like this. It used to be the case that the roof over your head was the most important thing and you paid your rent FIRST, even if it meant living on bread and jam.

I'm a schitzo - I agree with a lot of what Cosmo says in principle as well as r01 but in relation to my business its simply better for me the more generous the benefits system is!

We will definitely suffer from UC if Direct Payment to Landlords are not possible. There was a post on another article recently to a Parliament debate that suggested direct payment to Landlords was likely to be included for vulnerable tenants. This may be the first bit of good news if it actually happens. Apparently though there is no guidance to DWP over the criteria for vulnerable applicants, unlike the criteria laind down for LHA.

However a solution as for LHA payments that many are still not familiar with may be to use Credit Unions or similar for the receipt of benefits and payment of rent. Its pretty much the best of the situation and no threat of clawback because you are not receiving the benefit!

Well rio i can understand why your schizo. I dont get "over generous rents from benefits"I'm also a LL for 20 years. The boom that took place in house prices was damaging to me as it stopped me building my portfolio. I dont discriminate against anyone and I run a tight ship and i work hard for my wages. I provide a service to lower income families who otherwise would be homeless.The majority work but many unfortunately dont earn enough to pay the rent and live in a descent way. Why isnt there a campaign to have a living wage.Regardless of what the Sun and the Mail say vast majority of HB reciepients are working. If your making fortunes from low income rent ,good for you because i'm not. Why arent people talking about low wages thats the problem instead of some blaming greedy LL and some blamming lazy tenants

@Paul
I think you misunderstand me, I don't make a fortune form benefit tenants at all. What I was saying is that the more generous the system is the better it is for us and how that can go against ones own principles of hard work and personal responsibility. I am currently chasing 50% of my benefit tenants for arrears and these changes will make an already difficult situation worse.

your mother has read, in some health magazine, that dark chocolate is good for the heart as it lowers cholesterol. And onions fried in olive oil have extra vitamins which give you lots of energy. you will live a long life if you eat these.
so, as your mother loves you very much, she bakes a cake. with chocolate and fried onions in it. and she expects you to eat it.
it's obviously disgusting but you have no wish to upset your mum so....
.what to do ?

you agree to eat the cake on one condition;
she has a long look at a very nice old peoples home just down the road where she will be very well looked after and you will be able to visit her every weekend.

and that is how you treat Universal Credit.

Further to Ray's comment about using a Credit Union. My local CU is setting up a system whereby tenants can agree to have their UC paid into their account each month, and the rent will be deducted immediately and paid to the LL. Only then can they access any of the rest of the money. If they want other amounts reserved to pay bills then they can request this too. It would cost the LL £5 pm, which I think is worth it to avoid arrears. Apparently the council is looking into using it too, no doubt they'd get a volume discount.
I would have no qualms advising tenants to open a CU account as there are other benefits too, not least keeping them away from pay day loans and loan sharks.

Thanks Roberta. I will definetly look into that. It could be a problem solver. As is stated by many LL'S dealing with problematic low income families that they want their HB paid straight to LL. This gives some sort of stability for them.
I'm sorry Ray but talking about "generous benefit system" and LL'S benefiting from it is falling into an anti private LL trap. We operate in a competitive market system. If benefits go up why should people pay more rent when there may be a cheaper house down the road.Why wouldnt they save the extra money and spend it in Tesco's or British Gas or Witherspoons or someone else. You have to change your mindset.If you believe that LL have got rich from the HB system and if their was no HB their would be no LL's then your crazy.I would like to hear Tesco's getting pilloried for an increase in Benefits with people moaning that they should bring their prices down for people on benefits.

I'm not having a go at you Ray but I hear a lot of people complain about money going to LL but never about benefits going to British Gas or Tesco's etc. This system will never changeuntil we have a proper descent minimum Living Wage,Instead of government trying to manipulate the price of goods and services.

@PJ
You seem to read lot of things into peoples posts that they have not said. Indeed I actually stated that my personal principles were at odds with the effect of the level of Housing Benefits on my business. You ask why the tenant would not spend the extra money at Tesco or wherever. The reason is that LHA is paid specifically to fund rent. Maybe you do not fully understand the LHA system (As I do not the other parts of the benefit system as they do not directly affect me) but it will not pay them the extra as it only pays up to the rent figure or the max allowance whichever is the lower. This means most benefit tenants cannot now afford my well prepared properties from their LHA alone and either need to find a to-up from elsewhere or rent somewhere less tolerable. I will soon need to evict a number of tenants because of the LHA cuts yet some of them get more in benefits than I currently earn for working a 60 hour week. -And still they do not pay me even what they receive in LHA despite being able to afford 50 inch TV's, pay for Sky and all the rest of the things that I cannot afford. Its about priorities and the system is mad! And the new UC system is worse still !!!!

You talk about needing to accept that our business is in a competitive market (Which I do) then denounce the competitive labour market which sets wage levels, as unacceptable - You can't have it both ways! You seem to want to manipulate wage levels however this would have no effect on those that do not work.

I'm sorry Ray but on the one hand you talk about "generous benefits" and then youre talking about evicting tenants because the rents from LHA is not enough.My point is the money tenants recieve from HB is not overly generous.UC is going to make it that much harder for us to collect money from the portion of people that its meant to help. In the long run it wont work. As has been stated before they tried it in the 80's and it flopped.Anedotal evidence about TV's and Sky and smoking are not bourne out by research or facts or for what its worth my personal experience.

I think you have hit on it when you say that you won't now rent to HB recipients. This will create ghettos and poor housing. I dont want that society. BTW minimum wages are in every capitalist society barring a few. We can set living wages for people and still live in a competitive society. There is a role for government to stop a race to the bottom. Unfortunately business doesnt want that and prefers goverment picking up the tab. Just remember the vast majority of HB recipients work...