Even though the government thought it would be a good idea to pay the housing benefit direct to the tenant they still had the sense to introduce this key part of the legislation:
“If the tenant is more than 8 weeks in arrears then the council has to pay the landlord direct”
Now full marks to whoever suggested this. I have no idea how they arrived at 8 weeks as I would have set that as 1 day however it meant that the smart landlords could use this to their advantage.
Now any landlord who was receiving housing benefit knew that getting paid took a while. You would move in an unemployed person and you would have to wait around 3 months before the claimant’s claim got processed and you got paid. You would then receive a big chunky cheque equivalent to 2-3 months rent and then you would receive rent 4 weekly in arrears.
The council’s slowness has NOT changed. They still take ages to process the claimant’s claim and therefore you can use this to your advantage.
This is how you do it:
- Move tenant in and start the housing benefit claim
- After 8 weeks write to the council and state your tenant is 8 weeks in arrears and you now want the rent paid direct to you
- Council now pays you direct once their claim has been approved which is roughly week 12 or 13.
Simple. All that hoo ha about rent being paid direct to the tenant is only a problem if you do not know how to work the system to your advantage legally.
Now some councils may revert paying the tenant directly once they have paid the first cheque but this is rare. If this does happen KICK UP A FUSS! You can state that the tenant has a history of paying late (as proved) and the tenant cannot manage their finances therefore you want to be paid direct.
The other thing is to get paid in full. You have to make sure you have set your rent to their maximum LHA entitlement. If you have a 2 bed property you want to let it to a tenant who can claim for 2 bedrooms.
A bedroom is needed for:
- every adult couple ( Married or Unmarried )
- any other adult aged 16 or over
- any two children of the same sex
- any two children regardless of sex under age 10
- any other child
If the person is single and under the age of 25 then only a room rate is paid as they are expected to live in shared accommodation.
So if the person coming to view is single and under 25 then you politely tell him that your property is not for them. If a young couple with one child and one on the way approach you then BINGO. They will have full entitlement to rent your property EVEN if the guy decides to leave the relationship and property.
So are you all clear on LHA yet?