Hi everyone, I am about to start rent now process with dss tenant. I have been told that there currently is a backlog of 2-3 months for the initial payments to come to the landlord directly with universal credit. How will this work if I am using the rent now process as they will be in the flat before they pay first months rent? They back pay it in one lump sum, and yes this is legit as I have spoken to housing officer. Many thanks Delphine
If you are using rent now to collect the rent, that will not be possible. The holding deposit, first months rent, and security deposit has to be paid to open rent before move in.
I would not touch this. The rent is a monthly payment, and if someone canât pay monthly, they wouldnât be renting one of my houses.
If the government want landlords to rent to people on benefits, then they need to get their house in order and pay benefits quickly.
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@Delphine1 ask @mod_harry but i expect you can choose to use âRent nowâ just to create the tenancy agreement and do the rest yourself. You can register a security deposit (if any) later after received (think has to be within 30 days)
If you choose the option for Openrent to collect the rent at 10 quid a month then they will take holding deposit and balance of 1st months rent and holding deposit and will pass 1st month rent on 10 working days after receipt. This is still an option I think at least if they or the council can send the holding deposit but obviously OR will start chasing the month1 rent arrears as soon as they occur so you have to tell them not to do that., probably repeatedly⌠and then start monitoring/chasing of rent as needed once rent payments are on schedule. Itâs obviously not as straightforward
Youll be taking a risk on whether tenant application for support is successful, and on the tenant not arranging to get the rent direct themselves and you cant expect LHAs to increase with market rates/inflation either, and tenant will need to make up any shortfall between the LHA and your monthly rent which is a significant risk too (they obv wont have lots spare)
but hopefully you know all that already
Good luck
Find a better tenant. Why would you put extra pressures on yourself when thereâs alternatives. Gov need to realise they canât dictate.
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You canât. Simple. Iâve explained in my post what payments have to made to OR if you are using RentNow. If you want to collect Holding Deposit, 1st months rent, or security deposit directly, then dont use RentNow. This has absolutely nothing to do with if you pay ÂŁ10 a month to OR for rent collection. That kicks in in month 2.
As ive said already you can
A. use rentnow just to create tenancy agreement i think. You can do all the rest yourself. Definitely an option. Just talk to OR customer support and agree it with them. They get same ÂŁ for only part of standard service. Why wouldnt they agree. At least worth asking them not assuming itâs not possible.
(Anyway the sample OR is downloadable so you can always use it yourself you then need to organise signing yourself instead of using OR to electronically document sign)
B. use OR to get the holding deposit and collect rent the tenancy agreement gets created signed electronically and they can move in whether or not the LL gets balance of 1st months rent on time or not. As soon as tenancy has been signed by both sides its a contract and then if as LL you hand over keys on move in day without having received the rent itâs at your own risk but the tenancy will have started on move in day when the keys are handed over. Just like if you did it all yourself.
The fact the tenant is late on 1st monthâs payment doesnt invalidate the tenancy in any way.
If itâs not possible to do either A or B, Iâm sure @mod_harry or @dan4 in ORâs legal team will correct me, but having used the process in recent months there is absolutely nothing forcing tenant to pay up balance of 1st month rent in between signing and moving in, except that they need the keys. OR document signing happens before balance of 1st month is paid. Most LLs wont then hand over keys if 1st month balance not paid but @Delphine1 plans to do that and once they move in the tenancy begins whether or not payment received. Its then always slightly nervous between signing and payment of 1st month balance and security deposit as can still be worried they might yet pull out and then youâve wasted a lot of time and effort.
Best
You realise if the tenant lies about their situation to the council, the council will claim back any rent money from YOU. You believe what a housing officer tells you ??? ( keen to get someone off their list)
âYou Canâ
& âI Thinkâ
in the same comments.
@David240 I donât like to argue on these forums, but I do know that your Option A is not how the RentNow package works, and have been engaging long enough on this forum to understand that OR does not work to enable the agreement to be digitally signed through Openrent RentNow system, and then for OR not to collect the 1st months deposit & rent. Thatâs simply Not how the system works. I stated that as fact in my earlier post, something which I only do when I know something to be right.
Your option B however is viable.
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@David240 Karl often gives great advice on OR RentNow issues. He hasnât got that little green tick on his avatar for nothing.
I notice you havenât and this would indicate youâve never used RentNow⌠at least with your current OR account.
We have used rent now before, but this is the first time we have used it for someone on benefits. Believe me this applicant is the best we have had when selecting from the vape shop âownersâ and âbarbersâ who have approached us. I have a feeling they think open rent is an easy target.
New fear unlocked! Thankyou for the heads up
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I have used Rentnow, actually, in recent months as I said earlier (and with current account)
But accept @Karl11 has more experience of it for sure and have replied accordingly
Best
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@Delphine1
I think @Colin3 makes a good point - you are trusting both the tenant and the Council to come through to provide the rent ÂŁ, so anything you can get from the Council in writing will help [inc what support they are providing tenant at mo, the LHA for your postcode/type of property, and any commitment they are willing to make/indicate].
I recently had a tenant tell me âHey Iâm interested to rent this place Iâm on universal credit ⌠council will pay 24 month AST Non-returnable grant: ÂŁ5,000.00 instead of depositâ so worth finding out if Council will offer you anything like that, as an incentive to take on the tenant, and how long such a grant payment would take to arrive
Good luck
Applicant is providing 3 months of bank statements to show the universal credit and the pip payments going in. Have discovered they would only pay ÂŁ15 council tax per month as they get pip and also have government grant pay the deposit. They would also get ÂŁ150 per year warm homes grant. Makes their affordability almost better than someone working! Really reassuring as a landlord to hear this.
After speaking with the applicant they have funds to pay the deposit monies themselves and then get reimbursed by their universal credit. Also sounds safer for them to pay me directly rather than the government to avoid them clawing it back if they were fraudulently claiming benefits.
Thankyou for everyoneâs advise, they look like someone who could be a long term tenant as long as they never slip up by missing an appointment and then get their benefit sanctioned (no benefits for several weeks).
would I be right in thinking giving you money to take a tenant means the tenant is a âdifficultâ person. Glad to palm him off on a private landlord and wash their hands of him ? I have heard of similar in the past.
@Colin3 you could well be right. If @Delphine1 is keen to go ahead with this tenant anyway, it wont harm to ask Council what incentives they may provide to go ahead, was my thinking.
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@Delphine1 other point is having somebody on benefits in the property may then make you eligible to claim various of the grants available to help upgrade insulation/heating, if that is an issue for your property [EPC C proposed to be needed either on current method or new, by oct 2030, based on the recent govt consultation]. Just be careful and dont get external wall insulation [98% fail rate with recent govt scheme according to NAO]
Good luck
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er⌠whoop dee doo⌠thatâs really not going to help them pay the rent.
yes, thatâs more like it. Itâll also show how they manage money and whether they have a cushion. Those are more important than the payments going in. Go over them very carefully.
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Hi all,
Just to clear a couple of things up from our end here.
In relation to the holding deposit, this always needs to be paid from the tenantâs OpenRent account and there is no workaround here to enter Rent Now. Obviously if the property is in Scotland, there is no holding deposit.
It is recommended that payment for the final balance is paid as soon as possible after contract signing and we do not recommend tenants moving into the property if the balance has not been settled. Where there are delays in receiving the final balance, there will also be delays in paying this out to the landlord.
In response to @David240âs comment above:
If you choose the option for Openrent to collect the rent at 10 quid a month then they will take holding deposit and balance of 1st months rent and holding deposit and will pass 1st month rent on 10 working days after receipt. This is still an option I think at least if they or the council can send the holding deposit but obviously OR will start chasing the month1 rent arrears as soon as they occur so you have to tell them not to do that., probably repeatedly⌠and then start monitoring/chasing of rent as needed once rent payments are on schedule. Itâs obviously not as straightforward
Just to clarify that the handling of the holding deposit, security deposit and first monthsâ rent are part of our standard Rent Now service. Our Rent Collection service is for ongoing rent payments; councils are able to make payment through this service or to the landlord directly.
Where a council is making full or partial payments towards the tenantâs final balance, they can make the payment straight to OpenRent and we are able to produce an invoice for them to be able to do so.
We facilitate many tenancy agreements where tenants are in receipt of benefits and weâre willing to work with councils and third parties to ensure that safe and legally sound tenancies can be set up through Rent Now. You can find some guidance here on how you can have tenantâs benefits paid directly to you in some circumstances.
Do reply here if you have any further general questions about this process, or reach out to our customer service team at the bottom of this page for any more case-specific guidance.
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