Fix Universal Credit housing payments once and for all, says leading trade association

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The Department of Work and Pensions (DWP) has been criticised once again for the way it pays Universal Credit (UC) direct to tenants and in arrears, causing problems for landlords.

Property industry trade association ARLA Propertymark says paying UC in arrears makes it impossible for many tenants to pay their rent on time and that it is time the government ensures “UC is adequate and more effective”.

Its comments, which are unusually forthright for an organisation that is not usually keen to publicly challenge government policy and performance, follows last month’s Equality Act 2010 court win for Shelter.

It secured damages of £4,500 plus costs for house hunter Hayleigh Pearce, who was told by Brighton letting agency Michael Jones & Company that she could not view a property because she was in receipt of benefits.

UC problems

Propertymark says the problem is not so much the blanket ‘No DSS’ bans operated by some agencies, but the reluctance of landlords to get involved in the often labyrinthine UC payments system.

As LandlordZONE has reported many times in the past, landlords struggle to persuade the DWP to pay UC’s housing element direct to them even when the tenant is co-operative, and that tenants spend their housing element before it can be passed to their landlord, leading to rent arrears.

“ARLA Propertymark is a member of the DWP Universal Credit Private Rented Sector Strategic Landlord Group and has worked hard to lobby for change to improve how Universal Credit works in the private rented sector,” a statement says.

The organisation is calling for direct payments to landlords to be made easier to organise, for payments to be more flexible to help tenants budget, and that tenants should not have to wait five weeks to get their first UC rental payment.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Fix Universal Credit housing payments once and for all, says leading trade association | LandlordZONE.

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Government predict 700,000 will use Breathing Space scheme

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People in England and Wales struggling to pay debts or rent could be eligible to use the Breathing Space scheme, and Government expects around 700,000 people to benefit in the first year of the scheme.

Creditors (landlords) are not allowed to contact tenants directly to request payment of the debt or take enforcement action to recover the debt (including by taking possession of a property) for a maximum of 60 days.

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LATEST: Landlords and housing campaigners unite to slam government over LHA rent freeze

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Landlord groups and housing charities have united to denounce the recent local housing allowance (LHA) freeze.

The benefit was frozen despite widespread rising rents, which will leave tenants in some parts of the country facing a shortfall of more than £100 a month, says Shelter.

Chief executive Polly Neate believes housing benefit should be there as a safety net to protect people who’ve hit rock bottom, and if it’s not fit for purpose, homelessness will rise. 

She adds: “The government can step in and keep more people safe in their homes, by reversing the freeze on housing benefit. Without this, a rising tide of homelessness could be the legacy of the pandemic.”

The National Residential Landlords Association says the pandemic has highlighted the need for a welfare system that provides tenants and landlords with confidence that benefit payments will cover rents.

A spokesman tells LandlordZONE: “For this reason, we strongly oppose the Chancellor’s decision to freeze the Local Housing Allowance in cash terms.

“It will serve only to make it more difficult to sustain tenancies. The Chancellor should think again and, at the very least, restore the allowance to the 30th percentile and preferable ensure it covers average rents in any given area.”  

However, rental agency Pick My Pad reckons that despite the freeze, many tenants on benefits are in a position to cover their rental costs. 

CEO Mish Liyanage says that in Manchester, the LHA rate is £138.08 per week for a one-bed property while the average private rent is £120 a week. He adds: “An agent can secure a higher rate per week eligible for the DSS tenant, vet the tenants, and get a non-cash damage bond on your behalf.”

Read more about Shelter.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – LATEST: Landlords and housing campaigners unite to slam government over LHA rent freeze | LandlordZONE.

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Leaseholder bringing his own builder in to quote?

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We are a small group of leaseholders who are also shareholders in the management company that owns the freehold to our flats. I recently took over from the chap who ran the management company as he sold his flat and nobody else wanted to do it.

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Lease and repair issues – I may need profession help?

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This is a tricky one – we are a newish development (old offices) of 3 new floors and one existing (residential) on the 4th floor. The 4th floor lease has a clause that excludes them from 1st works to the roof as it was to be provided in good order.

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EU citizen’s Right to rent in the UK?

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Does an EU citizen who arrived in this country six months ago have the right to rent a property without having settled or pre settled status?

Advice from our agent who, of course, has an interest in placing this tenant

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Changes to evictions paperwork ‘do not comply with law’ claims lawyer

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Alteration made by the government to a key form that landlords use to evict tenants are inaccurate and ‘do not comply with the law’ a leading legal expert has claimed.

On Friday LandlordZONE reported that legislation covering Section 8 notices had been amended to require landlords to include multiple references to and provisions for the ‘breathing space’ debt respite scheme from today onwards within Form 3.

At the time we flagged up to the housing ministry that many legal experts within the sector were concerned that the update to this template was inaccurate.

The ministry subsequently said it would update the guidance in time for today’s deadline.

Not compliant

But leading property lawyer David Smith (pictured below) of JMW Solicitors says the now updated template does not comply with the law despite his flagging up the problem to the ministry.

“The new form is meant to have its first and second bullet points in the ‘earliest date proceedings can be brought section’ replaced with five bullet points,” he says.

“This hasn’t happened. The first three bullet points have been replaced and one of the other bullet points has been interpolated in between the five new ones. It makes more sense that way but it’s not what the legislation requires.”

The Debt Respite or ‘Breathing Space’ Scheme is designed to protect a variety of people who may have built up problem debt caused by the pandemic.

As the form template sets out, the scheme impacts both the evictions process and how landlords interact with guarantors.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Changes to evictions paperwork ‘do not comply with law’ claims lawyer | LandlordZONE.

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Who do I pay back?

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The tenant has moved out and Rent in Advance pays everything up to date, so there are no arrears and everything is squared up.

As she left after the Benefit Assessment Period, it will mean I will get her Universal Credit rent paid to me for the last month

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LATEST: Housing ministry closes eviction ‘reactivation notice’ window as it clears backlog

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A key evictions window for landlords has been closed by the government as part of its plans to clear the possession hearings backlog.

Until before Friday 30^th April at 4pm landlords and their solicitors were able to apply to a county court to continue an eviction by submitting a ‘reactivation notice’.

This applied to landlords who had issued eviction notices prior to 3^rd August 2020 and who, in many cases, had been waiting since then with tenants who are in severe arrears.

But the Ministry of Housing, Communities and Local Government says that now that the deadline has passed landlords will have to apply to the court for a possession hearing and pay a fee. This will also put them at the back of the queue.

The deadline, which was previously extended from end of February, was designed to force landlords who have been wavering over whether to continue the evictions process against tenants. It was hoped landlords would come to a debt agreement with their tenants or hope they leave of their own accord before having to make a decision about continuing court action.

The updated MHCLG advice says: “You should consider whether making a possession claim is appropriate before confirming that you wish to proceed.

“For example, if you are making a claim on rent arrears grounds you may wish to negotiate a rent repayment plan with your tenant rather than proceed with the possession claim.”

Paul Shamplina of Landlord Action (pictured), says: “The re-starting of bailiff evictions on 1^st June cannot come soon enough for the 20,000 or so landlords waiting to regain possession of their properties, many of whom have been waiting a year or more to eject tenants who stopped paying their rent before Covid struck.”

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – LATEST: Housing ministry closes eviction ‘reactivation notice’ window as it clears backlog | LandlordZONE.

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Interest Only vs Repayment on Buy To Let Mortgages

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So you are buying a buy to let property, but what mortgage should you get?

An interest only mortgage or a Repayment mortgage?

In today’s video, I’ll explain the difference between an interest only mortgage and a repayment mortgage and which one best suits your needs.

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