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View Full Version : Two months "protection" gets tenants deeper in debt



Worldlife
16-04-2006, 08:39 AM
I'm wondering if others may agree that a two month arrears allowance before action can be taken Housing Benefits to pay the rent directly to the landlord results in a financial gap that a low income tenant will find impossible to bridge.

Why also does the legal system support the concept of tenants getting two months into arrears?

Could the homeless situation for Housing Benefit tenants be avoided by Local Authorities being provided with legal powers that where there is one month of arrears and a Section 21 Claim for Possession is issued the benefit must be paid immediately to the landlord?

What would be the potential savings to the Country if the rental debt and deposit against damages were to some extent underwritten once a tenant in rental arrears received and followed debt counselling from an approved body (e.g CAB)?

Surely a scheme such as this would be much cheaper than the costs of providing social housing for those made homeless for failing to allocate Housing Benefit for the purpose for which it is intended.

davidjohnbutton
16-04-2006, 09:21 AM
I find that once a tenant gets into arrears of more than £100, it becomes impossible to adhere to a repayment program to repay those arrears - meaning primarily those on HB though I have had other cases where arrears have been prevalent on non-hb cases.

The situation is even more difficult with those landlords in the LHA areas - fellow landlords in the North Lincs area which went LHA reported a large increase in arrears and typical examples of tenants moving in - appying for LHA and then spending the typically 2 months payment that subsequently came - new cars/tvs/celebrating the fottie etc etc. - however, the coin turned in a few cases where the LHA was subsequently paid direct to the landlord and the LHA was greater than the contractual rent - the landlord was able to apply the excess towards the arrears - typically about £650 or so and the experience has been that the LA has made payment direct quite quickly after the landlord has informed them of tenant arrears!

The LA's, as they do now with HB, still never regard the landlord as the creditor for the money - it belongs to the tenant - and if they do pay it to the landlord, they do so on behalf of the tenant. I would like to see it made a criminal act with compensation payable, for the HB or LHA money to be spent on anything other than paying housing costs - that is what is is given to them for!

islandgirl
16-04-2006, 15:08 PM
I fully agree with both of you. It is unfair that you have to sit back and watch "your" rent being spent on all sorts of things (holidays, new electrical goods) for 2 months before you can do anything as ours was. At the very least you should be able to tell the council as soon as the rent is not paid - they could suspend HB pending investigation. At least then neither party is getting it until everything is sorted out. It is also wrong that HB can be claimed at your property without you receiving any notification. My tenant was working when he got the house but later claimed HB - I had no idea he had claimed. The landlord had to sign to agree payment direct to the tenant at one time - this was by far a better system.