gary29 Posted February 7, 2007 Report Share Posted February 7, 2007 Hi Folks, could anybody enlighten me over the procurment of rent I receive from one of my tennants. The situation is, that my tennant was the former owner of the house but was threatened with repossesion. To service debts, of Her ex Husbands making. Like a knight in shining armour, I made Her an offer on the house. Which was accepted. On the proviso She would be able to remain as tennant on a reasonable rent. She has been an Assured shorthold tennant since October 2005. The rent I receive from Her is made up by Housing benefit and private rent. I have bought the property on a buy to let mortgage. Still only 14 months in on an introductory fixwd rate. Recently, there has been a change in the way I receive the Housing benefit aspect of the rent. Unbeknown to me, my tennant has altered the terms I receive this part of the rent. Although She refuses to confirm She demanded the change. I used to recieve a Bacs payment direct from the LA inrto my bank account. Enough to cover the mortgage. It seems my tennant has become wise that my LA pay rent weekly. Every four weeks infact. Wheras the private part of Her rent I receive PCM in cash with a rent card. This evening I have had a heated exchange over the terms for Housinfg benefit She receives. Because now, She has control over this aspect of Her rent as well. because the payment now goes straight to Her instead. This is because She is not happy that I was the beneficiary of receiving 13 annual payment cycles from the LA. While She only paid 12 every PCM Through Her own obligation. This now means my tennant will benefit from small HB payments personally as She is only willing to pay the HB aspect PCM like her private ammount. Is it worth me making hay over this discrepancy. Or just accept the Status Quo. Especially now I have raised the rent 6% the back end of 2006. And I will again at some point in 2007, another 6% in order to meet my incresed mortgage payments, come October. Any thoughts are welcome,regards Gary29 Link to comment Share on other sites More sharing options...
GPEL Posted February 7, 2007 Report Share Posted February 7, 2007 Not sure I quite understand the problem. The payment cycle may have been changed without your consultation but are you financially worse-off. If not, then why worry. Ideally, the payment arrangements should have been confirmed prior to the disagreement. The time to worry is when expected full rent payments are not made. Something to check is are you responsible for paying back the benefit to the council if your tenant is paid too much benefit or gets benefit she's not entitled to. Be wary of raising rent to meet your mortgage payments. Your tenant isn't responsible for the state of your account. Rent increases must be fair. Link to comment Share on other sites More sharing options...
Trenners Posted February 7, 2007 Report Share Posted February 7, 2007 Hi Gary29, I seem to be the forums "Housing Benefit" expert - for my sins ...... HB is paid 4weeks in arrears and is paid 13 times a year. The benefit can either be paid to the landlord r the tenant. Assuming the HB does not cover the full rent being asked then the tenant is responsible for making "top up payments" and it is usual for the tenant to make these payments every calendar month (ie: 12 times a year). Where the HB is paid directly to the landlord then HB is received every 4 weeks and the tenant "tops up" every PCM. Where the HB is paid directly to the tenant it is usual for the tenant to make 1 payment to the landlord on a per calendar month basis. As GPEL says ..... are you financially out of pocket by the change of arrangement ... if not - I don't understand what the problem is ..... Good luck, Mark Link to comment Share on other sites More sharing options...
Melboy Posted February 7, 2007 Report Share Posted February 7, 2007 Gary also touched another subject as well.........increasing rent because IR's are on the up and therefore pushing up BTL mortgage repayments. Is this going to be a trend for 2007 I ask myself ?? I doubt if that financial system will work in the long run. I reckon if that becomes the norm then it would be better for the Landlord to sell-up and get out of the BTL market. Link to comment Share on other sites More sharing options...
Trenners Posted February 7, 2007 Report Share Posted February 7, 2007 Melboys comments are interesting. I am also finding that a number of landlords are selling up now that the interest rates have started to rise. However these landlords are taking a very short term view. They are selling up because the monthly mortgage repayment is not being covered by the rent. Taking a longer term view (which is where the term LORD of the LAND) comes from ..... long term capital growth will more than offset any short term rental income shortfall. My advice .... don't sell ..... stay in the market ..... or continue buying .... Link to comment Share on other sites More sharing options...
gary29 Posted February 7, 2007 Author Report Share Posted February 7, 2007 Not sure I quite understand the problem. The payment cycle may have been changed without your consultation but are you financially worse-off. If not, then why worry. Ideally, the payment arrangements should have been confirmed prior to the disagreement. The time to worry is when expected full rent payments are not made. Something to check is are you responsible for paying back the benefit to the council if your tenant is paid too much benefit or gets benefit she's not entitled to. Be wary of raising rent to meet your mortgage payments. Your tenant isn't responsible for the state of your account. Rent increases must be fair. Link to comment Share on other sites More sharing options...
kevfallon Posted February 7, 2007 Report Share Posted February 7, 2007 As I understand it, the tennant can elect to have the HB paid direct to them or the landlord. At the start of this I would assume you stated you wanted paid directly to you? Is this in the rental agreement? keeping on good terms I would say is a good approach, but you have to think is this the thin end of the wedge, what else is going on? It is not her house-full stop, its yours, at the end of the day get it all in writing, I wish I did. Once the tennant starts dictating terms=reality tablet, dont be put off from speaking your mind if you think she has been a bit moody on you, again your house, your rules in the rental agreement. Link to comment Share on other sites More sharing options...
Simon Dewsberry Posted March 21, 2007 Report Share Posted March 21, 2007 Had exactly the same problem recently with a not too bright tenant who thought 4 weeks in a month -12 months in a year - the HB was paying an extra month's rent and i was benefiting by having an extra 13th month payment -and that this clearly wasn't on ; that money was meant for her not me ! so she had payments switched to her account and informed me there would be 12 payments of the 4 week amount (plus her 12 private payments as before)!!! When i pointed out that 12 x 4 = 48 weeks and there are in fact 52 weeks in a year she lost the plot and told me not to twist things "as you well know there are 4 weeks in every month and 12 months in a year "- she then informed me of the name of all of the months Jan all the way thru to Dec !! NOW WHAT DO I DO !!!i thought ! So i said "If you can get the taxman and my mortgage companies to agree with you then i will not bill you for the 4 weeks we are going to missing at the end of the year! " Needless to say this sailed about 1000feet over head!!! She stormed out declaring that there was no way i was oing to rip her off!! I called round to see her on my way home later that day with a diagram of a calendar with 52 blocks one for each week but she wasn't in so I scribbled a note telling her to take this to some one she trusted who she thought was good at maths !! Turns out she didn't know anyone good at maths as she ended up in local citizen advice bureau the next day - who called me to establish the facts ! how that poor advisor kept a straight face when she explained this to my tennant i will never know . The tenant called me later that day to say that she still didn't understand it but they said she had to pay it so she would change it back to being paid into my account !! One day I'll write a book on this lot as some of it gets surreal ! Simon Link to comment Share on other sites More sharing options...
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