Jail birds

[J4L]

Came across an interesting scenario the other day which I thought I'd share.

Have a tenant who moved into one of our flats via the local homeless scheme, it turned out (from our checks) that he'd just left prison and was on parole. We'd contacted the team and said that we couldn't trace him on our credit and ref checks and a little worried that he was lying on his application. They then admitted that he'd been in Prison but due to data protection they couldn't tell us that sooner but it was ok, they were paying his bond and covering his tenancy so we allowed the guy to move in.

3 months into his contract we got a call saying that he'd broken his parole agreement and was back in prison awaiting a review of this by the parole board.

This is what I found interesting.

This guy had requested that all his HB payments come to us directly which they were until WE told them that this fella was back in prison!! Yup they suspended the payment to US after WE gave them the information!

After investigation I found that HB MUST continue to pay up to TWELVE MONTHS as long as the tenant is on remand. The day he gets sentenced then they'll stop payments.

As this guy is awaiting parole board review this is classed as remand and we are apparently going to have payments restarted.

My worry for others is, what if by new LHA strategies this guy had been paid directly into his bank account?

LL's would have to wait until the arrears were 8 weeks or more before they could intercept this payment, and then, if the guy gets sentenced after say 5 months on remand you'd still have to go down the court route then for possession, by which time HB would have to stop payments also. LL's could be well out of pocket.

Landlords MUST ensure they know this HB system inside out and also ensure that suitable safety nets are put in place at the BEGINNING of any agreement.

I see TOO many Landlords take the first person in that's waving cash under their nose without checking them out first and situations like this could arise quite easily.

[Chestnut]

As a matter of interest was this "homeless scheme" related to a council "Rent Express" scheme which I am about to embark on for first time?

I have been assured, having asked the questions, that the local council provides tenant with deposit and 1st month's rent both in cash, and researches the applicant's ability to continue to pay - either from their Housing Benefit through e.g. Job Seekers Allowance or by own means should he/she get a job. I was also assured there were no "bonds" involved.

It is the LL responsibility to get whatever T references required and generally otherwise conduct the prospective tenancy in the normal way, including the subsequent deposit protection.

"Rent Express" looks as good and safe to me as a direct LL-T arangement, but in talking to others, I remain a bit confused as to how different "Rent Express" may be from a "homeless scheme" case such as J4L's scary scenario above (Data Protection gone daft!).

[Simon Dewsberry]

Landlords MUST ensure they know this HB system inside out and also ensure that suitable safety nets are put in place at the BEGINNING of any agreement.

I see TOO many Landlords take the first person in that's waving cash under their nose without checking them out first and situations like this could arise quite easily.

Or be sensible and completely avoid this area of the rental market, running a biz is difficult enough, without tying your own hands behind your back and poking yourself in the eye with a short stick, which is effectively what you are doing by getting involved in this sector, on this level.

[MyLandlady]

"Rent Express" looks as good and safe to me as a direct LL-T arangement, but in talking to others, I remain a bit confused as to how different "Rent Express" may be from a "homeless scheme" case such as J4L's scary scenario above (Data Protection gone daft!).

[J4L]

Or be sensible and completely avoid this area of the rental market, running a biz is difficult enough, without tying your own hands behind your back and poking yourself in the eye with a short stick, which is effectively what you are doing by getting involved in this sector, on this level.

Surely if your both hands are tied behind your back then poking yourself in the eye is impossible is it not?

As long as you know what you're doing Simon then there's no problem.

My point here was to ensure that LL's don't take the first person in without checking them out first. I see it every day and am afraid that I have to get a lot of LL's out of pickles that they have got themselves into.

Of course you probably do check them out, reference them correctly etc and I half suspected you would give an answer like this but this is an area where of course you may come across some undesirables but you can't always tell straight off!!

[J4L]

As a matter of interest was this "homeless scheme" related to a council "Rent Express" scheme which I am about to embark on for first time?

I have been assured, having asked the questions, that the local council provides tenant with deposit and 1st month's rent both in cash, and researches the applicant's ability to continue to pay - either from their Housing Benefit through e.g. Job Seekers Allowance or by own means should he/she get a job. I was also assured there were no "bonds" involved.

It is the LL responsibility to get whatever T references required and generally otherwise conduct the prospective tenancy in the normal way, including the subsequent deposit protection.

"Rent Express" looks as good and safe to me as a direct LL-T arangement, but in talking to others, I remain a bit confused as to how different "Rent Express" may be from a "homeless scheme" case such as J4L's scary scenario above (Data Protection gone daft!).

Each council has a homeless scheme and they all come under different guises so it's very possible that this rent express scheme is the same.

I have to ask here, you state that the council provide the tenant with deposit and 1st month's rent and checks out their ability to pay/ Then you say you were assured there were no bonds!!

This is contradictory isn't it? The deposit and the bond in this instance are one in the same thing.

What I would say is make sure any such tenants accepted by you understand the HB system as many of them do not.

If you receive rent in advance from a scheme and the tenant gets their benefits paid in arrears then at some stage the scheme is going to want their money BACK!!!! This will catch up with itself as the tenant moves out so make them aware that this will happen, and don't allow tenants to fall into arrears, you need to be on the ball here.

These schemes are a safe proposition as long as you and the tenant understand how the system works.

[J4L]

I really do not feel that I can do with the hassle of having to gain access to my property for repairs etc with an unknown HB person in situ.

You have every right to know who's in the property as it should run in the same way as a normal tenancy.

With the 5 year scheme at least the Tenant will be Hyde Housing and they pay the rent direct to Ll regardless of who is in the property or if it is empty. I think you have to think about neighbours in this situation and think carefully about the condition you will get your property back in, but I think this scheme will be better for me rather than a 1year scheme.

Longer schemes are completely different and as long as the council take on the FULL responsibility of the property including repairs etc then you should be ok. I do believe you will only get a percentage of the rent from them though won't you rather than what you think it's worth, a bit like a rent guarantee scheme I think. It does take away the pressure a little but of course you're not in control of this and could have anyone in your house. They will install them but you may take the flak from neighbours if they are undesirables.

The local scheme to us is a temporary one where they use us as a stepping stone between hostels and council houses. Someone may be on a Gold Card but as there is no available housing for them their only option is a hostel. The wait could be anything up to 18 months but generally it's a bit quicker than this. The housing department say that these temporary contracts can run between 6 and 9 months.

You usually find also that if you work closely with them that they'll issue larger cover for you so let's say you have a property with a £500 rental income they will cover up to a £1000 bond should anything go wrong. This may differ from area to area though.

[Chestnut]

J4L

My understanding of a BOND is money which has conditions applied by the provider - in that case the local authority, who might withhold if their conditions are not met.

If Rent Express is paying the tenant in CASH for payment of deposit onward to LL to be lodged with DPS in normal way the only 'conditions' would be between LL, T, and DPS surely?

Isn't this the difference? Can someone answer this for me?

The district council assured me that under Rent Express no Bonds were involved.

The LL is responsible for maintaining the property and accepting (or not!) T references prior to AST in the usual way without constraint from council. With the LL in control it looks like a good scheme.

[J4L]

J4L

My understanding of a BOND is money which has conditions applied by the provider - in that case the local authority, who might withhold if their conditions are not met.

If Rent Express is paying the tenant in CASH for payment of deposit onward to LL to be lodged with DPS in normal way the only 'conditions' would be between LL, T, and DPS surely?

Isn't this the difference? Can someone answer this for me?

The district council assured me that under Rent Express no Bonds were involved.

The LL is responsible for maintaining the property and accepting (or not!) T references prior to AST in the usual way without constraint from council. With the LL in control it looks like a good scheme.

That's 'their' interpretation of a bond where they cover all eventualities, sometimes called a paper bond. It just means that you are not receiving the actual cash for this but they will cover costs if you experience problems etc. It's like an insurance policy I guess. The guy in the street won't have a clue of the difference and tenants will moreoften ask you how much the bond is. It's the same thing.If they pay it over to you then you need to protect it.