The payment of housing benefit direct to tenants has been labelled ‘a primary concern’ by Santander bank.
Although the bank was primarily talking about social landlords, who will be affected by the way housing benefit will be rolled up into a universal credit paid directly to tenants, private landlords who take housing benefit tenants are already seeing rent paid directly to tenants – who do not always pass it on.
The bank, which is a major lender to the social landlord sector, issued the warning in a report looking at the impact of the Government’s reforms on two cities, London and Liverpool.
It warned that because social landlords will no longer able to be certain of receiving their rental incomes, they will find it harder to borrow at preferential rates.
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Comments
Sadly it seems majority of DSS tenants have the mindset of "entitlement", and this is compounded by the nanny state view that they should be put in total charge of their own financial affairs, including handing over the major part of their benefits ie rent to the landlord .
The amount of non rent cash benefit is insufficient to live on, hence the chronic indebtedness, as flagged by other posters. This despite the fact that in most cases the grossed up total benefit income is well in excess of average wage, thereby negating any incentive to seek work.
Both state and commercial stats show that once worklessness has prevailed for 12 months, there is less than 1% chance of a return to work, probably due in no small part to a permanent change in outlook by those concerned, so no easy solutions.
Only once in 35 years did i, at the behest of one of the negotiators, let to a couple who had fallen on so called "hard" times. They never passed the rent on to us or the landlord and more or less squatted for months before the landlord had to SELL the property to them at well below market price to clear his mortgage and arrears!
Never did it again.
Santander is living in the past. Us agents have been aware of this problem for some time and is a significant reason why lots of us just will not deal with DSS.
We have flats locally which are new and the leases do not allow DSS occupiers and on one of them the buy to let mortgage our landlord holds excludes DSS DWP (Dept of Works & Pensions) and students from being tenants.
We have a local block of flats where the insurance excess rises from £100 to £500 if there is a claim whilst the unit is occupied by a DSS supported tenant. As a result we will no longer deal with DSS DWP or students.
What's the matter with Santander and when are they going to get to grips with a problem of the govenments making. After all they own the problem and the solution, but I am only an estate agent and dont know nuffin!
Taken from another thread, but I think it is relevant here
"If ARLA want to do something positive how about forcing councils to repay landlords the housing benefits paid to tenants , then stolen by those tenants. I have one tenant who has just told my landlord that he has taken his first 8 weeks rent to start a business, when the council was informed they said, 'it's not our policy to prosecute tenants for not paying the rent, as far as we are concerned when we give the tenant the rent we consider it paid'.
Maybe we should set up an association of independent agents which uses subscriptions to fight against these unfair polices which are weighted against landlords & agents, and puts the emphasis on the thousands of bad tenants. Instead of ARLAs mantra that all agents are rouges unless we pay ARLA subs."
Our instant reaction to anyone asking if we take DSS is no.
Call it what you want, but it's just too much hard work especially when you have tenants falling over themselves to rent in London right now!
It is ridiculous. We have genuine cases of tenants who freely admit they would rather not have the money paid to them because they are tempted to spend it. Last year our all tenants were paid on the 23rd of December! So obviously we were the last people to see that money and whilst the tenant had a lovely Christmas we had a hidious New Year chasing a huge amount of unpaid rents.
Other tenants who are in a lot of debt (which is the vast majority of DHSS tenants) who at least before would have had their rent paid and kept a roof over their head now have it paid into their bank accounts where it gets swallowed up by their outstanding bank charges.
And so they should be....its political madness to give someone already on zero or low income (hence their entitlement to DHSS) the best part of £1000 - £1400pcm and then expect them not to spend it on fags, booze etc. I recently went to a house where there was an X5 BMW in the drive and guess what, the Tenant was claiming DHSS and hadnt paid the rent for 2 months. I has another case where I called Housing to state a Tenant was not paying the rent and I was told "its their money they can do with it what they want!!" These are NOT an isolated cases and the reason why we no longer deal with DHSS claimants.