Terms & Conditions

[irene lowe]

Rent liability in this case has been paid a year in advance, £9000 in total, conveniently disposing of all but a couple of hundred of the claimants capital.
As her income would clearly qualify her for some element of H.B,. we are inclined to use the £9000 as notional capital, and apply the diminishing capital rule to take account of the reduction in this prepayment which will occur as the balance of the rent is collected/deducted

Would this be an acceptable application of the regs bearing in mind this is a monthly rent liability although the tenancy has been granted for a 12 months period. It would appear in the past we have disregarded such advance payments but it seems very wrong to me

[Darren W]

Reg 8 Allows us to pay benefit if there is no liablity due to the rent having been paid in advance. Though this is not set in stone this is normally one or two months.

In your case you will have to make a decision under Regulation 49 (1) that the reason he paid £9000 up front in rent was to

[i:a298183637]deprived himself for the purpose of securing entitlement to housing benefit, or increasing the amount of that benefit.[/i:a298183637]

I would say it would be hard to prove since he could just say that he had the money and wanted to make sure that he had a roof over his head for the next year. You might also want to look at the terms of the tenancy agreement. Though not common it is not unusal for people to have to pay rent in advance in larger chunks then one month.

[irene lowe]

sorry to bring this up again but has anything changed recently to make this more of an issue – we are noticing that payment of rent in advance (6/12 months or more) is no- longer a rare occurance in our area and wish to make a stand in respect of the benefit claims which follow – are there any argurements we can consider other than depravation of capital and is anyone aware of any relevant caselaw we should consider first or can quote – we have paid a couple of these in the past and think the news has got around

[andyrichards]

This isn’t going to be that helpful, but I think you are stuck with what there is around the issue of deprivation of capital. What is the “significant operative purpose”, etc.

It will all turn on the facts of each case.

Just out of interest, presumably the tenancies do last at least long as the amount of rent paid up front do they? What has happened on previous cases?

[Kevin D]

I suppose that [b:d4270d2e0d]CH/1822/2006[/b:d4270d2e0d] is a CD which could potentially be used where a LA is arguing deprivation in the “future rent paid” scenario.

But, I broadly agree with Andy R. In addition to the point raised by Andy (i.e. does the rent exceed the length of the t/a), a couple of obvious questions (er, at least to me…) include:

1) Why did the clmt pay such a large sum of rent in advance? (“significant operative purpose” test)

2) Would the clmt have done the same in the absence of HB?

It’s a tough one, because I can understand a clmt wanting to secure accommodation for a significant period of time if s/he foresees a potential problem later on. But, it does leave you wondering if such an advance payment would have been made if it hadn’t been for a benefit claim….

[Stalbansbenefits]

In this area a lot of landlords will not accept Housing Benefit claimants (or tenants with a poor credit history) unless the rent is paid in advance in full. Nothing to do with people seeking to maximise their benefit entitlement.

[seanosul]

[quote:6b0512279c=”irene lowe”]sorry to bring this up again but has anything changed recently to make this more of an issue – we are noticing that payment of rent in advance (6/12 months or more) is no- longer a rare occurance in our area and wish to make a stand in respect of the benefit claims which follow – are there any argurements we can consider other than depravation of capital and is anyone aware of any relevant caselaw we should consider first or can quote – we have paid a couple of these in the past and think the news has got around[/quote:6b0512279c]

I do not think it is for officers of Local Authorities to make a stand, we are supposed to impartially apply the law. It is definitely not unusual for a claimant to use their capital to ensure that they have a roof over their heads (and the public are still of the opinion that we just mess claims up and take ages to pay) or for a landlord to require a tenant to pay up in advance, given the common view of HB claimants is that they will smash the property up.

So what was happening six to twelve months ago to spark this off? Looking at your performance you were running quite a large backlog (49 days processing & 100% over 50 days). Seems like a good enough reason to demand money up front from the next set of tenants.

It now seems that you have had a good recovery. With that in mind, LHAs are designed to defeat unequal treatment of claimants as the theory is that it will put claimants on an equal footing to working people.

[Kevin D]

Sean, you seem to be having a bad day….. 🙂 .

One or two sweeping generalisations, me thinks (of course, I’m never guilty of that….. :shock:). For example, I’m not entirely convinced that it is a “common view” that HB clmts will smash properties up…. And, there are occasions where LAs do indeed need to make a stand in applying the law correctly (erm, cue exempt accommodation…. :cry:).

And, having previously worked at Irene’s LA, I can say hand on heart that although they are far from perfect, delays in processing claims are (generally) no better or worse than the majority of other LAs I have worked with / at. It may well be that the STATS suggest otherwise, but the reality is somewhat different (back to the arguments about LA’s “massaging” PIs etc).

Er, on that note, hope your day gets better….. 😕

[seanosul]

Soz if it appeared to be a bad day post and I hope Irene does not take offence (is a bad day – the washing machine flooded and Insurance plumber is still not out – costing me a day off work), however ask landlords who do not let to HB claimants why?

Whether it is deserved or not, public attitudes towards public services are based on the service that they perceive they got. If a Council builds up a backlog, their service will be seen as poor, for many months after the backlog has gone.

The benefit scheme is designed to create arrears without backlogs. So what would any claimant do when their contract requires rent in arrears?

[Anonymous]

most, if not all, letting agents in my area request a minimum of 6 months rent up front if the prospective Tenant is self employed. 🙂

[Author]

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