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  • LHA/Universal Credit

    Landlords welcome planned changes to UC



    Responding to reports that the Work and Pensions Secretary will today announce reforms to Universal Credit including a new online system for private landlords to get rents paid directly to them, Chris Town, Vice Chair of the Residential Landlords Association said:

    “Our most recent research has shown that 61 per cent of landlords with tenants on Universal Credit have seen them go into rent arrears, up from 27 per cent in 2016.

    “Improving, and speeding up, the process by which payments can be made directly to the landlord has been a central part of the RLA’s campaign on Universal Credit. Anything that helps this will give landlords much greater confidence in the system and ensure tenants have greater security in the knowledge that their rent payments will be met.”

    With reports also that Amber Rudd will announce that the current benefit freeze will not continue beyond next year, Chris Town said:

    “Independent research commissioned by the RLA has recently warned that the freeze in housing benefit rates has been a key driver of homelessness from the private rented sector,

    “Unfreezing them will enable benefits to keep up with the reality of market rents.”

    SEE ALSO  -       Systemic flaws in Universal Credit identified

    UP NEXT -            UC has not delivered value for money - NAO

    DON'T MISS -       Universal Credit-A TOTAL DISGRACE

    NOW WATCH:

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    Well that’s a move in the right direction sense at last

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    Learn Change and Adapt ?????

    All comments are for casual information purposes only. If you wish to rely on any advice I have given please ensure you obtain independent specialist advice from a third party. No liability is accepted for comments made.

    I welcome this news as it supports tenants and is an obvious way to prevent hardship for those through no fault of their own.  However, it should just be the first step towards a fundamental reassessment of the delivery of the policy.

    As both a LL and and agent, one of our many concerns is around passage of information.  One of my staff is on hold to the UC helpline as I write, and has been for 25 minutes so far.  We have confirmation that our tenant has been moved from LHA to UC in August 2018 but have had no rent since then despite continuous chasing to UC for information.  They won't even tell us the tenant has been accepted onto the benefit, despite us having written confirmation from another government agency confirming they are.

    My staff will have to hang up at 0950 as he has to meet the tenant to evict her at 10.00 this morning.  Another LL with unpaid rent, another tenant looking for expensive emergency accommodation, another family in distress.

    Come on Amber Rudd - you have got to get this gripped!

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    Andrew McCausland

    Managing Director Hamilton Square Estates Ltd

    Proprietor Wirral Property Group

    Sourcing and renovating investment property since 1994


    UPDATE TO MY LAST POST.

    I took over monitoring the on-hold call to UC from my lettings neg and was connected after 25 minutes.  They said that they can't answer the query as the tenant has been moved from the "live service" to the "full service" UC system.  The department I called (live service, apparently) can't get any information from the full service as "the computers can't speak to each other".  I have to call another number to get an answer.  You coudn't make it up!

    PS The number for UC full service is 0800 3285644

    PPS Most people are being put on full service, and all new claimants will go there (unless they don't - don't ask me why this may be the case as my blood pressure is already too high). If you call full service and the tenant is on live service you have to then call a different number again and wait.

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    Andrew McCausland

    Managing Director Hamilton Square Estates Ltd

    Proprietor Wirral Property Group

    Sourcing and renovating investment property since 1994


    Latest update

    On hold to the UC full service for 60 minutes then the phone cut off.  Marvelous.


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    Andrew McCausland

    Managing Director Hamilton Square Estates Ltd

    Proprietor Wirral Property Group

    Sourcing and renovating investment property since 1994

    Hi Tribes

    Today's announcement, which means the death knoll for UC 47s, at long last, and the introduction of an online replacement should be welcomed by landlords & agents accommodating benefit reliant tenants.

    Caridon Property's specialist staff have been testing the new system for months and have already benefitted from the new approach. No more non-secure emails and postings to DWP's Wolverhampton office and much less likelihood of documents going missing or applications being separated from supporting documents. Hopefuly, DWP will introduce shortly.

    This combined with the withdrawal of "explicit consent" in December 2017; the introduction of the 2 week HB/LHA run-on; and introduction of the new dedicated helpline are all positive steps, although from Andrew's comments, the latter is starting to cause nothing but frustration due to the length of wait to get through. You may recall I explained this new procedure in one of my website bulletins https://universalcreditadvice.com/private-landlords/2018/10/dwp-creates-new-process-permitting-access-to-case-manager

    Initially, feedback from my clients was very positive, with cases being resolved, in many cases, simply by getting to the person responsible for making and implementing the APA decision. But as PRS landlords and Letting Agents became aware of the service, the numbers of calls quickly exploded with apparently no additional staff available to deal with the volume of new callers. I've already raised my concerns with DWP's hierarchy but would encourage more of you to do the same. Andrew's experience is certainly worthy of a note to the new Secretary of State Amber Rudd who can receive emails - Ministers@dwp.gsi.gov.uk

    Over the past few days I've been contacted by landlords & agents asking me if its true, the rollout has been put on hold or been delayed. Neither is true. The rollout continues, and, if anything is gaining pace as far as new claimants and those being transferred from "live" service, so, expect to see a rise in the the number of your tenants being affected.

    It's also worth remembering, that from 11th April 2018, any tenant transitioning to Universal Credit from LHA can have their "housing costs" paid direct to their landlord, if that landlord had LHA paid direct to them at the point of transfer. Another of my members' bulletins explains the process in more detail. I've opened up the link to non-members for a day or so https://universalcreditadvice.com/ha/2018/04/uc-payments-direct-2-weeks-bonus-payment

    I hope this helps

    Bill

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    HI Bill and thanks for your very useful post.  I did hear the BBC news tonight and thought - good god, someone in government is actually listening to us!!?  I was hoping Amber Rudd's comments about direct payment of rent to landlords was happening across the board.  From your post it appears there are substantial restrictions.

    Rudd is apparently looking at ways to both make UC less toxic to the voters and also more efficient, but lacks any more resources from the Treasury.  She is searching for no / low cost ways to get the Conservatives out of the hole they dug themselves into.  Well, Amber here is a corker for you: 

    Make all payments of the housing element of both LHA and UC direct to LL or agents.

    This will:

    1.  Take pressure off tenants who often do not want or can't take the responsibility of budgeting for the month and paying their rent - tenants happy.

    2.  Reduce evictions and free up the creaking Courts service - landlords, tenants and judges happy.

    3.  Reduce the need for expensive emergency Council housing - Council CEO's and tax payers happy, B&B owners unhappy.

    4.  Substantially reduce the national level of rent arrears - landlords, politicians happy (as landlords are less likely to campaign against their stupidity), taxpayers happy (as landlords pay more tax on increased profits again), Council EHO's and B&Q shareholders happy as LL again invest in housing improving standards.

    5.  Reduce the calls to the UC helpline - less call centre staff needed so taxpayer happy, LL and agents happy (see my previous posts above), tenants happy as they can now get through to the helpline to get actual benefits queries answered.

    So Amber, seems a no-brainer to me.  A simple no cost change to deliver exactly what you need  - an immediate victory to show you are listening, compassionate, have a grip of your brief and can deliver effective change.  Give me a call anytime if you want more options to improve the housing market for buyers, sellers, renters, landlords and investors.

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    Andrew McCausland

    Managing Director Hamilton Square Estates Ltd

    Proprietor Wirral Property Group

    Sourcing and renovating investment property since 1994


    I wouldn't tolerate that arrangement.

    I'm very much in the camp of give a man a fishing rod, etc. Until such times as it is common practice for employers to pay landlords directly I believe that a tenants benefits are theirs to manage. If they are unable to manage their finances, for whatever reason, qualified support should be available. There are many flaws in the benefits system but this is not a solution to help those on benefits, its a solution to guarantee income for landlords. What happens when the tenant returns to work?

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    The sentiment is fine of course but the reality is so very different

    There is simply nowhere near enough support available to ensure that happens

    It is totally impractical

    Vast swathes of the population are dysfunctional in money management  and do not have the skills

    You are setting them up to fail and its just not fair on them

    School and parenting is where those skills should be learnt - Work coaches afterwards is far too late

    They have a captive audience at school but financial management is not addressed

    But even with that support at school many many folk will squander cash if its given to them

    Many people do not have the ability to plan ahead

    This is true of many in work as well who just spend spend spend then wonder why they are still working at 65

    Society should face up to the fact some people are spenders and some are savers

    If society as a whole truly thought the same as you why are  HMRC  allowed to deduct tax from my wage slips

    Why does the employer send it straight to them and miss me out . Shouldn`t I be taught how to manage my tax bill

    Why not pay gross to me and trust me pay my tax bill

    They don`t because they dont trust me  and it would become a bureaucratic nightmare to chase me

    The country would be in financial chaos very very quickly if the government trusted everyone to pay their tax bill

    Also If one is truly empowering tenants to manage their finances then they should be allowed to make the conscious decision to pay the landlord direct because technology allows it and its one less hassle . Why should the government force a tenant to do it their way. The tenant is making a sensible decision to say . Look I am happier to pay the LL direct . I thought about it a lot and and trying to manage my life and I have concluded its the sensible thing to do because managing money is not a strength of mine and i got enough on my plate .

    Myself I got loads DD`s and STO`s as its easier and practical and shows that i am managing

    Should I perhaps not rely on the bank to manage that aspect of my life for me

    The government in effect says to tenants  . Tough not your choice mate . We are going to pay you and its sink or swim mate . Crazy dictatorship type behaviour . Thats not support -  thats just cruel.

    Paying direct to me has worked for the last 10 years for all concerned for all the reasons Andrew mentions

    Giving it to the tenants with no DD on their situation at the outset  is completely reckless

    They dont ring me up either to ask my viewpoint even though i`ve known them for maybe 5 years

    Why dont they use me as a charator and financial reference

    I could say they are an alcoholic but they will hide that from you

    I could say when they had to top up £50 pcm it was always late so its folly to pay it all direct now

    I could say - I wont accept that moving of the goalpost so I will evict

    Why do they do it all behnd my back as if i just dont matter even though i own the roof over their head

    Where are my rights in all of this

    Where is the common sense

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    Jonathan Clarke. http://www.buytoletmk.com


    I disagree with the statement 'Make all payments of the housing element of both LHA and UC direct to LL or agents.' which I believe you also disagree with as you have stated 'Why should the government force a tenant to do it their way.'

    I don't think it is reasonable to compare a benefits tenant's housing element to an employee's PAYE contributions, these are very different deductions. Why doesn't my resi mortgage provider deduct my mortgage payments directly from my employment income, it would be possible and would ensure that payments are made, and its their property for as long as there is a mortgage balance outstanding?

    I agree that there is a lack of financial education at a young age and as a society this needs to improve. Most of us work it out through experience and maturity, but some don't. I believe that most people in receipt of benefits are able to manage their finances and that most people in receipt of benefits, if not already working, will return to work.

    The issue I have is with those that are either unable or unwilling to manage their finances. I don't believe it is sufficient to simply pay their rent directly to their landlord without identifying the causes. It will be appropriate in some cases but others may require a greater degree of support.

    At the very least, direct payment of rent to a landlord should trigger a process to ascertain the actual needs of the claimant. It could also require additional criteria on the part of the landlord.


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    I think to tackle the issue of financial common sense amongst the masses, is not a small task, there are nowhere near the resources in place to fix something of that magnitude.  Having landlords paid directly is a big safety net for some vulnerable tenants who cannot manage their money, and whilst we do need to fix the root cause, it is more important right now to keep a safety net.


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