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View Full Version : Landlords experience of HB, help please.



EH11
10-09-2006, 21:53 PM
Looking for feedback from LL's who have currently, or in the past had tenants on HB.

I recently advertised an excellent property in my local paper and was disappointed by the reponse. The only potential tenant would be paying through HB. He claimed that the processing of the HB application would only take approx 3 weeks. Is this a realistic timescale in other people's experience?

He also said that I can choose to have the rent paid directly to me. I said that I believed the legislation had changed and rent was paid to the tenant who in turn paid the LL. He said this wasn't the case and that I, as the LL could choose either or. I suspect this isn't the case, can anyone clarify?

Any informed advice gratefully appreciated.

Thanks

pippay
10-09-2006, 22:24 PM
I'm a tenant but have experience of HB so hopefully this will help ..

There is no way you can tell whether ANY tenant, working or claiming benefits, will turn out OK or not .. the only way you can minimise your risk for either is by thorough referencing.

The other thing you have to bear in mind is that you will be paid 4 weekly IN ARREARS (the tenant gets paid 2 weeks in arrears)

Personally, I wouldn't necessarily turn down the applicant just because he is claiming HB and would rely on referencing and gut instinct .. but perhaps you would feel more comfortable if the prospective tenant were able to pay a more rent in advance - if he were to pay 2 months in advance,say, then by the time you get the HB 4 weeks in arrears, he will always be in advance on the rent ??


Looking for feedback from LL's who have currently, or in the past had tenants on HB.

I recently advertised an excellent property in my local paper and was disappointed by the reponse. The only potential tenant would be paying through HB. He claimed that the processing of the HB application would only take approx 3 weeks. Is this a realistic timescale in other people's experience? It really does depend on the Local Authority concerned and how efficient they are. In my current area they only take about two weeks from the date of receipt of the application and if it's merely a change of address (i.e. the tenant was immediately prior in another rented property for which he claimed HB, then a full application is not necessary and they can "fast track" the change of address and payment details. My previous Local Authority though, took nearly two months to deal with a Council Tax benefit claim! Try calling the HB dept and asking them what a realistic turnaround would be, assuming the tenant supplies all the relevant information at the time of application.

He also said that I can choose to have the rent paid directly to me. Correct I said that I believed the legislation had changed Not to my knowledge !! and rent was paid to the tenant who in turn paid the LL. He said this wasn't the case and that I, as the LL could choose either or. I suspect this isn't the case, can anyone clarify? It IS possible to have the rent paid directly to you but the tenant must give the HB dept written authorisation for this to happen (there is a section on the HB claim form for this)

You also need to establish that all the rent will be covered by HB and this can be done (to a degree) by the prospective tenant asking for a "pre-Tenancy Determination" carried out independently by the local Rent Officer who will take into account the size of the property ( i.e. a single person living in a property with a lounge, bedroom and dining room will NOT have the full rent paid as the dining room will be deemed to be a bedroom) as well as the rent itself and whether this is in keeping with the average area rent for comparable properties i.e. If the area comparable is £425 for a 1 x bed and you are charging £475 then it is unlikely the full rent will be covered by HB and the tenant will have to pay the balance of £50 himself.
Any informed advice gratefully appreciated.

Thanks

cmack
10-09-2006, 22:24 PM
They are correct on all theyve said. my last one took four weeks to get the money comming in from them and i get it every four weeks not calendar monthly. yes the hb can be paid direct to you and this suits most as they dont want the hassle of having paid to them and out to you again.
please do reference thoroughly and take and reference from them a surity also.
Take a deposit and the month in advance will meet the time taken by LA to process forms etc.
My houses also are excellent top notch rentals and I take a personal pleasure from knowing that Ive given someone an opportunity to live in a nice, decent area / house compared to the ghettos the council offer.
There is a word of caution though, if your only looking for short term lets you may have a job removing the tennant as LAs do tend to make tennants stay put till bailiffs sent as they would be technically making themself homless which means the council wont rehouse in any hurry.
If its long term near garanteed rental your looking for, so long as all 'feels' right and checks out then go for it!

caroline7758
11-09-2006, 09:10 AM
I'd agree with all that's been said, except that to expect someone on benefits to be able to come up with 2 months' rent in advance is unrealistic, unless they can borrow it from someone.

BTW, if anyone is in an area where the Local Housing Allowance is being piloted, HB is paid to the tenant unless they are considered "vulnerable". (A stupid idea in my opinion.)

welshgold
11-09-2006, 16:30 PM
BTW, if anyone is in an area where the Local Housing Allowance is being piloted, HB is paid to the tenant unless they are considered "vulnerable". (A stupid idea in my opinion.)

i believe this is being brought in in my area shortly, housing benefit officers have said they dont want it, i dont want it and i suspect most tenants would not want the hassel of money coming in and out of their a/c, but central goverment want everyone regardless of their situation to be in charge of their own finance, i have spoken to a housing letting agent in blackpool where it was introduced arround a year ago and he said it had been a disaster as far as landlords were concerned

justaboutsane
11-09-2006, 17:34 PM
Noone wants it but Govenrment are pushing ahead regardless!

They have not listened to a single person using this new system and are just ploughing ahead.. isn't it great living in a democracy!!

I am even aware of tenants who do not want it, they know their own weaknesses and fear the worst. THey would prefer to go back to the good old days when benefits covered the full cost of their housing needs, none of this less HB more benefit so you pay the difference yourself hassle!

But hey ho!!

LMT
11-09-2006, 19:22 PM
I let out a flat to a single Mum who's on HB, she has been in the property since April 2004. After the first 6 months I had to increase the rent slightly as the block maintenance costs and the mortgage interest rate had gone up. Two years later I have had to put on another small increase to start October 06, again to cover my increased costs. I have always tried to keep these increases as low as possible, and the rent is still cheaper than for anything comparable in the area.
My tenant took the rent increase notification to the council, who told her they would not permit it, as they 'only allow increases once a year, and that would be in April on the anniversary of her initial rental start date'.
So the fact that there's not been an increase for 2 years does not come into it. Obviously I'm reluctant to make life difficult for her, but tenants and landlords can only work with the information they have got.
In many cases it's not the tenants that are the problem but the way the council's systems work. The councils all know that landlords require a deposit, they all know they require rent in advance, but it makes no odds and there's no support system in place for HB claimants to get round this.
On the plus side with HB tenants you tend to get a tenant who will stay put for a number of years because so few other landlords are willing to take them.