Single mums

[Julian_S]

I'd be grateful for some advice regarding the above and those claiming benefit

I have a mother in law wanting an apartment of mine for her daughter who has split from her partner. One kid, one on the way, living on the state I imagine.

She seems very genuine and is offering to go as guarantor, pay double the deposit or two months rent in advance. I've never had anyone other than full time paid employees before so I'd be grateful for any advice - pitfalls etc. What route should I take or should I just run away?  The properties don't stay empty for long but the 'soft' side of me says I should consider her. Yes I know emotion shouldn't enter the equation. :-)

Regards Julian.

[Richlist]

The decision to let to people on housing benefit normally falls into one of the following categories......

* You're a landlord that specialises in this type of let. Have lots of experience with benefits tenants and know the pitfalls and how to avoid the worst problems.

* You're a landlord with little experience of letting, don't fully understand the system and see letting to this type of tenant as an easy/quick way to fill the property. 

* You're a landlord that lets their heart rule their head with often disastrous results.

There is no doubt that this type of let carries a much greater risk of damage to property, financial loss, more time and effort to manage, sleepless nights and worry.

Normally benefits tenants will only have access to property at the cheaper, poorly maintained end of the scale.......if you're one  is not one of these why would you let it go that type of tenant.

It's your choice.

I wouldnt let my properties to anyone on housing benefit. Obviously there are good benefits tenants but the reputation of that group has been damaged beyond repair in my mind.

I use a large high street letting agent. They find this group of tenants so problematic that they will not handle any lettings to this group.

Good luck.

[Melboy]

I have let one of my properties in the past to a person(s) on benefits. One was fairly good and the other was not good at all and caused me a lot of problems which I didn't need. I am not part of the social services as a landlord.

Things you need to consider also.

The rent is now paid directly to the tenant unless there are circumstances where you can get it paid directly to you. Big mistake by the Government to permit this direct payment to the tenant imo.

Your property insurance premiums will rise if you accept a DSS tenant.

If I was facing your circumstances would I consider letting my property to this person?  The simple answer is no I would not. You can see  the future trouble on the horizon due to her circumstances. Why take the risk.

[Richlist]

I forgot to mention.

Every single BTL mortgage i have ever had from any lender......and I've had a lot......does not allow letting to benefits tenants. If you have a mortgage, you might like to check.

[Julian_S]

Thanks for the replies. The property is unfurnished and is a modern apartment in a large block. I own it outright and a property management company deal with repairs to the building (like leaking soil pipes etc) so insurance isn't really an issue. I suppose a criminal tenant could (for instance) rip the kitchen out but I would just have to put that right at my expense.

The last few lets have been people that I have found myself, having got cheesed off with the local agents (Countrywide - now in deep financial do-do I think) and feel that I can do a better job by meeting prospective tenants, showing them around and chatting to them first. 

I think I will take the advise and give it a miss for now. I've only advertised it locally at the moment but when it becomes empty (soon) I'll take some pictures and use that agency that are registered with Right Move and stick it up on that. Thanks

Julian

[Richlist]

Forgot to mention......I get the impression there are far to many benefits tenants who belong to the 'entitlement' club. Some of them think they are entitled to everything provided of course that its paid for by somebody else.

You have now probably worked out that I'm not comfortable, on a business basis, in dealing with people in receipt of housing benefit.

Good luck.

 

[Melboy]

I am in the process right now of processing prospective tenants for my newly purchased property.

I always conduct my own business and have not used an LA for many years although I do know of a few. My Daughter is an estate agent so I do have contacts.

I do use Gumtree as a source of tenant finding and in my experience it is no worse or better than using an LA providing you are prepared to carry out all the legal work associated with letting property and more importantly tight tenant vetting.

I have actually managed to find very good prospective tenants for my new property and I had a choice of 3 couples who replied to my advert and all of them passed my (and Richlists     ) application criteria which is fairly comprehensive.

It is easy to dismiss those who would not be suitable to me and a case in question would be your applicant Julian. Not for me I have to say and like I said I am not part of Social Services and if it all goes belly-up it will be you having to sort out the mess and loss of income and additional expense.

My last tenant was sourced through Gumtree and that was 4 years ago and he has turned out to be a model tenant.

[Julian_S]

Thanks Melboy. The situation has resolved itself as the young lady thinks it's a little too close to the city centre and maybe too noisy. It's not noisy really as it's down a cul-de-sac but that's the matter sorted.

I too find my own tenants after a big LA found me a supposed BMW mechanic who actually was (as i discovered very easily)  a car valeter and had an ex wife and kid to support. He couldn't find the £550pcm and I had to evict him which turned out to be fairly easy as he ###### himself when my paperwork arrived, signed for delivery. I was lucky there.

So I don't automatically see the advantage of LAs, the latest chap I found really is a mechanic (I'm good in that area too and a 2 minute conversation with him soon told me he was genuine) and he has an Eastern European GF who is a hard worker. (they all are)

I shall try Gumtree. I found these lot who will stick your property up on rightmove: https://www.myonlineestateagent.com/landlords What  do you think?

What criteria do you use for vetting - particularly their financial situation, is it right to ask to see pay slips dating back years maybe? But of course they could still be in bad debt.

Julian.

 

[Melboy]

If you ask Richlist very nicely he will put up his criteria list that he uses....and many others....... It's comprehensive and you can choose to use what parts you feel that are important to you.

I always ask for 3 months bank statements.

Download the Tenant Application Forms available on this Landlord's Home Page. It is comprehensive and covers almost everything you need to know about an applicant.

You will get a few chancer's and no hoper's and down right lies in your replies from a Gumtree advert but it is no worse than any other advertising website.

[Grampa]

Bank statements tell a lot about how someone manages their finances. You also get an inside to the person as you can see what they purchase.

length of employment and current tenancy are also a good guide to stability. 

Bottom line is dont be pushed into a rushed tenancy and trust your feeling about the person. If you dont feel comfortable with them or you feel you are not getting the full story tread carefully. Use the excuse you have a couple of interested parties.

 

[Julian_S]

Thanks for the Gumtree recommend. I've just stuck a free ad on it, I'll see how it goes before upgrading with a paid option. I'm only 1/2 trying at the moment as there's another week to run before its vacant.

[Richlist]

My list showing those applicants who I do not accept for tenancies has steadily grown.

I advertised for a tenant and included just a summary of people who need not apply, it certainly wasn't my full list. One guy, emailed me to suggest that the person I was looking for didn't exist anywhere in the world. He was wrong of course, it does take a little more time and patience to find the right person but that effort pays off big time.

I eventually found a single lady, working as a PA in London who ticked all the boxes. She stayed almost 2 years, paid top dollar in rent, was perfect in every respect and when she recently moved out there was nothing to do. She had left the flat incredibly clean and tidy, there really was absolutely nothing to do to prepare for the next tenant.Why can't all tenants be like that ?

Don't despair these people do exist if you put in the time and effort to find them.

[Julian_S]

Thanks all. Gumtree has snared me two potentials today and the ad only went live early this morning.

Julian.

[fionaf]

Openrent has always worked well for me. It advertises on Gumtree, Rightmove, Zoopla etc. First advert free, after that £29. 

We’ve never started out renting to to HB claimants but had two turn into HB claimants, one where both husband and wife simultaneously developed back problems and left their jobs and then reported were registered disabled so we needed to replace the entire bathroom suite with a walk in bath etc, it was an upstairs flat with no lift that they had no problems climbing the stairs for. They then wanted a new kitchen and things started going wrong with the serviceable and clean but ten year old kitchen including the sink that suspiciously looked like a hole had been drilled in the bottom of it.  We had to evict them and at first they were pleased thinking they were due a nice little bungalow from the council but they ended up in temporary accommodation for months and begged us to re-let to them but we had already re-let and had no desire to have them as tenants again.

Then another where the couple split up and the Mum decided she wasn’t going back to work after mat leave and she did a flit leaving the house in a state and loads of debt.

I therefore have had a few too many bad experiences and would now serve notice as soon as it was clear they were stuck on HB for the foreseeable future, problem is they have no need to tell you of a change in circumstances so I am tougher on all tenants who start asking for a few days leeway or don’t agree to a twice yearly check-up on the property. 

[Richlist]

Twice yearly???

That seems rather laid back.....is twice a year enough ?

I prefer quarterly inspections plus additional ones when tenants are moving out..  You can't be careful enough and twice a year doesnt sound sufficient for me.

[fionaf]

Perfectly reasonable from our experience. Our tenants have a right to a private life are relatively professional types and too much invasion would be counter productive. We live within two miles of all our properties, have the neighbours with our numbers and drive past the properties  regularly so see the state of the front garden, any new car, etc. For those who ended up on HB were in the minority and the inspections wouldn’t have revealed their HB status anyway, only the state of the property. 

[Richlist]

When property condition suddenly becomes a nasty surprise its usually as a result of insufficient inspections.

I certainly wouldn't want to inspect as infrequently as every 6 months.

[Julian_S]

I've always found that little problems crop up that need sorting. The hot water that is no longer hot because the stupid time switch needs a degree in rocket science to fathom out or the hydraulically damped door closer that is leaking and allowing oil to escape. These sorts of things give you the ideal opportunity to have a gander.