Tenants with foster child/ren

[Acura]

Hi guys

I wonder if any of you have come across this before?

We have got a new family about to take on one of our properties. A couple with a young adult son, and a foster child. The father has been declined on the references as his foster status is deemed to be running a business.

Our agents are unable to draw up a contract for them on this basis. They can manage the let, just not have a Tenancy Agreement. 

They are asking other agents if they can draw up a contract on our behalf, and I've put in a call with the NLA to see if they can draw one up for me. 

While I'm waiting for the call back I thought I'd see if any of you seasoned LLs had ever had this situation and what you did about it. 

Thanks!

[Mortitia]

Never, ever let to anyone without a tenancy agreement - you'll never get them out!

 A have let to someone with a foster child but the referencing was fine and I don't get why there should be any problem or the need for a special agreement.

I would ask to see the referencing papers from whomsoever did the job and carry out my own checks on his employment, CCJs etc - it's not rocket science and all out there on the net for a small price. 

 

[Richlist]

I've never come across it before but then I nearly always take rent guarantee insurance and they do the referencing for me.

I assume that as a foster carer he /she is deemed to be running a business and therefore it's been decided that whats needed is a 'company let'......which requires a different type of tenancy agreement.

Lots of agents will not deal with this type of let.

Go back to the agents and check whether that's the situation.

[Melboy]

"Our agents are unable to draw up a contract for them on this basis. They can manage the let, just not have a Tenancy Agreement".

 

Never!    Plenty of ways of checking the status of the Father. Running a business?  Check the status of that business and any previous business dealings.......bad debt ......bankruptcy.  ....etc. 

 There should be absolutely no problem with referencing just because the family have a foster child imo.

[Grampa]

Don't understand what the problem is.

If the tenancy is in an individuals name a normal AST could be used if the tenant is a company or business name then it would be a company let and it is advisable not to go there.

I suspect this is either an inexperienced agent who is a bit confused and cant think outside the box on the status of the tenant or an inflexible muti branch agency.

If they can show evidence of income to prove they can afford the property and all the other refs such as previous landlord, work, ccj, bankruptcy etc etc pan out what's the problem. You can still get rent guarantee insurance, throw in a guarantor, a slightly larger deposit as well and bobs your uncle. 

If your agent cant work round that you have the wrong agent.

 

[Acura]

Hi guys

Thanks for your replies. 

Our agent is very experienced and extremely frustrated (as we are) by this red tape by their corporate company rules. 

If someone is deemed as running a business and declined on the tenancy check, their rules are that an AST is not permissible, despite the reasons here. 

They are a RAF couple (he's retired) therefore, in our eyes, excellent potential tenants. We've let to RAF families before many times (near a base) and not once had an issue, so we are keen to get this sorted.

We have no intention of having no agreement, just that our agents (at the moment - we are appealing!) can't/won't draw one up. 

I've spoken to another agency we have dealings with in the past who will draw up a Common Law TA, but we'd really prefer not to do that if possible.

Spoke to the NLA and they think it's a red herring too. Very frustrating all round.

I did suggest I'd try and reference check them (him - she passed just fine) myself with Homelet but the legal department at corporate HO are linear with their checking.

All bloody ridiculous really as the small amount of money he receives is to care for the girl. Our agent told him to put everything on the form even though it was negligible, to our downfall. 

[Richlist]

Don't beat yourself up over it.......if they can't meet acceptance criteria then find other tenants. There are lots of good tenants out there.

 

[Grampa]

I still don't get it. You can use a Assured Shorthold Tenancy (AST) as long as the below doesn't apply:

• If the rent is to be greater than £100,000 per annum
• If the tenant is not to be an individual (e.g. company)
• If it is not intended to be for the used by the tenant as their only or principle home
• If the tenancy is pursuant to an earlier contract to the same tenants and the earlier contract was made before 15 January 1989.
• If the tenancy is for the purposes of a business.
• If the dwelling-house consists of or comprises premises licensed for the sale of intoxicating liquors for consumption on the premises.
• If it is a tenancy under which agricultural land, exceeding two acres, is let together with the dwelling-house.
• If the tenancy is an agricultural holding.
• If the purpose of the tenancy is to confer on the tenant the right to occupy the dwelling-house for a holiday.
• If the landlord is a Resident Landlord as defined in Schedule 1 Housing Act 1988.
• If the tenant is to be a lodger, living with the landlord.
• If the tenancy is to be granted by a private landlord under arrangements for the provision of support for asylum-seekers or dependants of asylum-seekers made under Part VI of the Immigration and Asylum Act 1999

I do not see having foster kids is a business unless it is run as a business only in the property but its not, its a family home. Whats the difference to receiving foster allowance and say child benefit or tax credits?

You are the client, instruct YOUR agent to use a AST. If you have to sign a disclaimer so be it. If they wont find another agent.

They should know that even if you used a AST and shouldn't have it doesn't make it all invalid it just make the AST element invalid  so you couldn't use a s21. All the normal do and don'ts still apply because they agreed and signed to them.

[Acura]

Thanks Grampa

I've gone back to my MA and said pretty much that, and also mentioned about child benefits/tax credits. 

It's the TLC that classed his 'income' as a business, and then Sequence Legal Team refusing to be lenient and see the fostering for what it is. 

Frustrating, but we'll get there. Difficult when we're overseas and can't sort this face to face. 

[Melboy]

All very odd but understandable and now you have mentioned a large corporate national agency Sequence Homes why am I not surprised.

If this is the best that their legal team can come up with as a reason for barring your prospective tenant then why would I or anyone else want to do business with them?

So what to do?

1.  Change agents.

2.  Look for different tenant's.

3. Manage the property yourself..

Not an impossible task even if you are overseas. Instruct a friend or relative to monitor the property and conduct the 6 monthly viewings Rent guarantee insurance. etc.

Your tenant being ex RAF is unlikely to be any problem especially if he is on a military pension and has passed all the tenant checks you need to do......... but there again I am biased.  

[Grampa]

Sequence Homes. Ah it becomes clearer

I brought a flat from them about 3 years ago in my local area. They didn't know I am a agent and not only did I get the worst customer service during the buying process they then tried to get me to use them as a letting agent.

I think I posted about this on this site at the time. They didn't know their arse from their elbow. Didn't know about the superstike ruling and all the implications.

 

[Melboy]

Sequence Homes is a collection of local LA's and EA's flying under the same National flag title even though they have an independent trading name......possibly.

In all situations you will get the Good The Bad and the Ugly but it is a known fact that many people have had a bad experience when dealing with Sequence Homes.

I am guessiing that the 5 star reviews are probably "plants"   

My experience of using a National chain of LA's goes back 20 years and it was diabolical to say the least and I said never again. If I have to use any LA and I do from time to time, I use a local small independent LA.  At least I know it will be him on the end of the phone and he will know me.

http://www.reviewcentre.com/reviews138875.html

[Grampa]

1 hour ago, Melboy said:

 

My experience of using a National chain of LA's goes back 20 years and it was diabolical to say the least and I said never again. If I have to use any LA and I do from time to time, I use a local small independent LA.  At least I know it will be him on the end of the phone and he will know me.

 

Plus you get the flexibility and common sense when you need it.

[Melboy]

 

"Plus you get the flexibility and common sense when you need it" 

 

You said it Gramps.  

[Acura]

I'm glad I told you it was Sequence and not our MA because she is just as disgusted (without saying exactly that in email!) about the ruling as we are. 

When we first instructed our agent they were a local and very well respected agent with 3 branches. They were the top agents to use, and I always dealt with the same person. 

Then Sequence came along and it all went fubar. I had different people emailing me all the time and I ended up putting my foot down. I'm back with my original contact who knows what she's doing. Sadly can't say the same about the accounts Dept at HO. They're shocking ?

Would love to self manage but our circumstances here make it very difficult. We have the time difference to start with. Only an 84 year old relative nearby who used to show people round and give me her opinions on them. All too stressful. Even more stressful than dealing with this type of crap! 

Thanks for all your comments. I've woken up with no email this morning so I'm hoping no news is good news. 

Will let you know the outcome. 

[Acura]

Stalemate 

I have spoken to our compliance department and senior managers and I am afraid that I do not have good news in respect to us drawing up the agreement.  I have received the following advice.

TLC's and our company's criteria is that we do not accept foster parents as the law could consider the property as being used for business purposes.  For this reason as we know Mr X is a foster carer we cannot draw up a AST, as this states the property cannot be used as a business.

With the common law tenancy we as a company do not draw these up as our company believe that a foster carer could well claim at a later stage that they are indeed running a business from the premises (regardless of the amount of children they end up fostering) and should this happen this would make ending the tenancy very difficult indeed as it could potentially allow them an indefinite tenancy at the property. For this reason we cannot prepare a tenancy agreement for these tenants.

I understand this is very frustrating, and can understand your queries, but I have been informed that we have had similar circumstances previously and been involved with producing such agreements which has resulted in tenants claiming indefinite tenancies. So the company stance on this would not be changed I’m afraid, so there is no way around us producing a tenancy agreement for you with these circumstances.

So we are back you sourcing a tenancy agreement from another party and we need a indemnity signed to confirm you understand we have no involvement with the content of any such agreement and would not check it. We would also need the tenant(s) to sign an indemnity confirming they understand we have had no involvement with producing the tenancy agreement which the Xs I am sure would be in agreement to signing.  Mr X is being very understanding and even apologising for the issues caused, of which I am of course saying this is not his issue to apologise for!

Sounds like they are trying to protect us, but boy, there's no leeway at all.

We have two choices: get an AST from elsewhere (we have another company willing to do one for us) or find new tenants. 

Sitting on it for a bit, but will probably go with option A. 

[Richlist]

Thanks,

I'll add foster carers to the longlist of people who I do not accept as tenants. That means there are still 99.9% of tenants that are suitable.

There is no emotion here.....it's a business.

 

[Acura]

1 hour ago, Richlist said:

Thanks,

I'll add foster carers to the longlist of people who I do not accept as tenants. That means there are still 99.9% of tenants that are suitable.

There is no emotion here.....it's a business.

 

Exactly. Just figuring out our options here. We've already lost one set of tenants due to referencing (and my gut feeling about them which is bizarre as I'd not met them. Just somehow knew!) and there'll be more if we decline these.

 

[Melboy]

All very odd really. So if I ever have a tenant that makes cushions from home and sells them on ebay or anywhere else that classes the persons occupation as a business and I won't be able to take them on.

So why don't the legal people just draw up a document that your prospective tenant's will never claim they are running a business and a legal understanding that this would be the case?

It would be interesting to see what the government legal departments acting for the foster carer's and the children have to say about this matter.... as for me I think it is a load of old bo**icks coming from the people who have stated this legal position to you.

[Acura]

Argh. 

All sorted re: AST. Have an indemnity from our insurers it's ok for 1 foster child to reside in our property. 

At the 11th hour the tenant has informed our agent there may be more foster children in the future. Up to 3 at a time. 

That would mean there would be 3 adult (inc 20 year old), 1 foster child (10) and potentially 2 other foster children (if 2 they would need to be related so could share a room). 

Pretty cheesed off this has come to light now. The day ASTs are to be signed and monies to be sent (we're taking 12 months in advance and protecting deposit ourselves due to AST complications). 

Gut is torn here. I know you say there is no emotion in letting Richlist. Keeping that in mind. It's all frustrating to learn this at the last minute. 

[Mortitia]

That is a real nasty trick.  First find a gullible landlord then move the goal posts.  You should have stipulated in the agreement that one yes,ONE foster child is acceptable and no more.  You could end the tenancy at the break clause or tell the LA that you will not allow more kids.

[Richlist]

It's easy for me to say there should be no emotion because I can easily operate that way but, I recognise we are not all made the same.

I can see how some people would want to help in this scenario and its a kind and caring person that does that. Women in particular seem to instinctively want to help and I think that is to be applauded.

Provided its done with at least one eye on the business side of things and you are happy with arrangements then well done you.

It's good that there are some people around who do these things, the world would be a hard and unforgiving place if everyone was like me.

Now, got to rush, got to go beat up a tenant........?

[Acura]

4 minutes ago, Richlist said:

It's easy for me to say there should be no emotion because I can easily operate that way but, I recognise we are not all made the same.

I can see how some people would want to help in this scenario and its a kind and caring person that does that. Women in particular seem to instinctively want to help and I think that is to be applauded.

Provided its done with at least one eye on the business side of things and you are happy with arrangements then well done you.

It's good that there are some people around who do these things, the world would be a hard and unforgiving place if everyone was like me.

Now, got to rush, got to go beat up a tenant........?

Haha! And a couple of LAs at the same time please!

It's funny - I'm the woman here and I'm leaning towards 'if this is coming to light now, what else is being hidden?' and my husband is saying we've come this far, go ahead with it. 

Insurers are fine with foster children, so that's ok. 

I googled the man this morning and found a recent write up about him. Sounds like a good egg. 38 years in the RAF and with retirement looming he felt he needed to do something constructive. He and his wife had looked after respite children in the past, and as he now has the time he wants to devote it to this cause. 

They have deposit and 12 months rent ready to CHAPS to us as soon as we (I) give the green light. 

Thanks both for your replies. They've helped. 

[Melboy]

38 years means he is on a good RAF pension.    Personally I would not want to do what you are planning to do. 1 Foster child possibly but not a children's home.

Keep us posted on future events please.