Originally published at: https://blog.openrent.co.uk/openrent-letter-work-pensions-committee-inquiry/
As the UK’s largest letting agent, OpenRent has been asked to contribute to the Work and Pensions Select Committee’s investigation into lettings industry practices around tenants who claim benefits. We were of course very happy to contribute and our Co-Founder Adam Hyslop will be attending a session to speak to MPs about this important issue.…
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Good to see your submission to Frank Field Sam, and to know that these discussions are happening. Problems re late payment of DSS because that is how their system is set up doesn’t seem to have been put to Frank? If they could correct that I think there would be a greater uptake of DSS applicants, who in many ways should be guaranteed payers.
Maybe in your final paragraph you meant to say you were NOT a letting agent?
Would a bank give loans to people who cannot repay it. Of course not. This is no different. A lot of money has gone into a rental property and the government offer absolutely no protection to the landlord without the landlord having to fork out a fortune to get possession of his/her property. If they fail referencing or I can’t get rent guarantee then I will not let them the property and if I am forced to go down this route I will sell it and the government can follow their own legislations and house them. At the end of the day people are responsible for their own destiny and it should not be forced on me. Landlords are not social caretakers we are businesses. If they couldn’t afford to pay for food from a supermarket should the shop let them have the food and trust they will pay later. Of course not. The rental business is no different and should not be discriminated against in this way. I lost a lot of money on my first venture because of a DSS tenant and I will not go down that route again.
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Hi Sally, Good point about late payment.
That (along with how housing benefits have been frozen/not keeping up with rents since 2010) is something we think is a big part of the reason why many landlords have a preference to let to people with an earned income.
I didn’t mention it in the letter because many companies/organisations received questions from the Committee, and I trust that some of those other respondents are better placed to make those points. We just answered the questions that Frank Field MP asked us, which on this occasion didn’t include general thoughts on the benefits system.
Im sure that other groups, e.g. Citizens Advice will be bringing it up with lots of evidence to back it up!
Sam
Spot on, Christine, I couldn’t agree with you more.
Here’s my experience with the abomination named ‘Universal Credit’.
My tenant stopped paying his rent. To cut a long story short, he had lost his job due to his mental state. He made a claim for Universal Credit, but he made his claim late, so they will not back date claims when claimants do this. Consequently, I did not get paid for this gap period. FIRST PROBLEM.
I applied to get payments made to me directly, but I was told that even though the tenant had agreed for me to be paid directly, they couldn’t pay me, because there was not a valid reason (as laid down in their rules and regulations). I would have to wait until he was at least 2 months in arrears. SECOND PROBLEM.
When I reapplied (after he had gone 2 months into arrears), I had direct payments authorised, however when the payments came through, they were monthly in arrears. THIRD PROBLEM. They were also more than £130 less than the normal rent. I was told that it was because a sanction was on his benefit, but they could not divulge any further details. FOURTH PROBLEM.
The tenant decided to arrange alternative accommodation (with the help of a person from a charitable organisation and neither party informed me that they were doing this). The tenant failed to give me the proper notice and left the property. I was expecting a further payment from Universal Credit, but it didn’t come through. I found out that, because they stop the payment immediately from the date the tenant physically leaves the property, regardless of the fact that I was being paid in arrears, the last month that he was in my property would not be paid for. FIFTH PROBLEM. So, these are the crazy rules we are dealing with when dealing with a Universal Credit claimant.
He refused to give me a forwarding address and Universal Credit will not provide you with it, neither will any other organisation involved due to the data protection rules. There should be instances where they are obliged to divulge this information, such as in this case. SIXTH PROBLEM. I did, however, use a private company to trace him relatively cheaply, the charge for which will be added to my court claim.
The result was that I ended up with more than £1200 in unpaid rent, which I will have to take him to court for, but it will be highly unlikely to get the money back while he is on benefits. SEVENTH PROBLEM.
I will not accept any benefit claimants, not because of naked discrimination, but because of all of the above problems. In addition, Rentguard will not cover such a tenant (and I don’t blame them), so I would not be able to take out insurance.
The problem with governments introducing new rules is that they appear not to consult enough with the likes of me to find out the real problems that landlords face, consequently the rules end up being onerous and unfair.
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Hi Sam,
I would be grateful if you would send a further communication to Frank Fields copying comments from landlords. Please see my comments made on this blog today. For Frank Fields not to have sight of such comments, can only result in more poor legislation.
Regards,
Brian
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When the goverment decided to pay tenants the housing benefit to the tenant I stoped taking on this type of tenant. , and never will do. you get paid in arrears , if they make a false claim their money will be stopped and the landlord wont get any rent. they can recnde their agreement to have it paid direct to you. If it is paid direct, the local council will sieze any excuse to get it back off the landlord if the tenant has been “naughty” Its a minefield DO NOT ENTER.