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Ignorance should not be an excuse for tenants, but often will be claimed. A recent snippet in ‘Inside Housing’ caught my attention. The headline was ‘Claimants unaware of consequences’.
Most landlords will experience ignorance from their tenants at one time or another; that their tenancy agreement is with the landlord, not benefits; that rent arrears remain constant, even if the tenant is now paying the contractual rent as he should; that the landlord is entitled to evict a tenant that is causing so much trouble, the rental income really doesn’t compensate for the difficulties that occur. So, what were tenants unaware of that ‘Inside Housing’ felt it was worth reporting?
It is some years since the Government and Universal Credit decided that where tenants were up to 8 weeks in rent arrears, not only could private sector landlords apply for future rent payments be paid direct to them, but also that the arrears could be re-paid to the landlord, by deduction from the already subsistence level of benefits. 20 per cent would be deducted and repaid to the landlord.
Since this change was announced, I have advised landlords to make sure tenants are aware of this. 20 per cent is a lot to take from the benefits of the struggling, so I find it difficult to believe that in a government survey recently conducted and published last week, 75 per cent of tenants on the full Universal Credit system were unaware that their housing costs could be cut if rent arrears accrued.
Are the landlords I have advised the only ones who did as was suggested and made tenants aware that this could happen, at the start of the tenancy or when the first rent payment is missed? Or, as is more likely, such information has passed over their heads in a cloud? Do they think that ignorance gives a reason to make them appear more vulnerable?
If you are a private sector landlord, include it in your allocation process. You should be saying right at the beginning that you do not tolerate rent arrears, but add the fact that 8 weeks arrears allows you to ask for the rent to be paid direct to you, that 20 per cent of their benefit will be cut to repay the debt and, in case they think that this would protect them from eviction, inform them that this measure will not repay the 8 weeks outstanding rent arrears and that eviction is not ruled out, if the outstanding sum is not paid.
As we know, ignorance is no defence under the law, but good management means that though it will make no difference in the end, tenants should not be able to plead this. Landlords should therefore add a sheet to their tenancy agreement, outlining that this will happen.
You may want to add, if you are a kind-hearted soul, that you understand 20 per cent would be difficult for them, so you would be prepared, if they were open and honest, to enter into an agreement where they paid back less. It may not work, but it is worth discussing with the tenant in an adult manner. Both sign it.
If ignorance is an excuse, you can ensure that your tenants are fully aware of the benefit legislation. Forcing knowledge on someone is not easy, but you will have the proof that at least you tried.
For advice on buy to let issues – Ask Sharon