My 5 favourite landlord mistakes.

1) “The Council has stopped paying my rent”.

The council never were paying your rent . They were paying your tenant a contribution towards their housing costs based on their personal circumstances. Before you start whinging that “the housing benefit is for rent” it isn’t.

Let’s keep this simple

1) Any mortgage is between you and your mortgage company

2) your rental agreement is between you and your tenant.

3) any claim for housing benefit (L.H.A) is between your tenant and the local council. If they become more than 8 weeks in arrears or are classed as vulnerable you may have it paid directly to you. It however is never “your rent money”.

2) “It’s my property!”

Not whilst there’s a tenancy agreement in place . As long as that’s in place it’s your tenants property. Even if your tenants are not paying their rent.

3) “The property must be returned in the condition it was let”.

Minus fair wear and tear . If you think that waffer thin carpet you  put down with no underlay is going to be in the same condition after a family has been walking over it for 6 months then think again.

4) “If it’s in the tenancy agreement it must be legally enforceable”.

I have dealt with a landlord who has a term in his tenancy agreements that states

“If you miss a rent payment I have the right to enter the property and remove you and your possessions using physical force”.

Are we suggesting that that is legal as it is in a tenancy agreement given to a vulnerable person? It quite clearly isn’t .

5) “If you wish to remain in the property you must sign a new tenancy agreement”.

Usually this statement comes from letting agents who want to charge both the tenant and the landlord a fee for preparing a new agreement. If the tenant wishes they may simply allow the agreement to roll onto a monthly agreement. If the landlord does not like this then they can start the eviction process. However the tenant never “has to” sign a new agreement to stay in the property.

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Increasing my debt and losing Local Housing Allowance in one move.

When I bought my flat in 2006 I was a little naive and believed that the 73 year lease the property had was plenty. It wasn’t. 6 years on and  the lease now has 67 years to run and very few mortgage companies would lend on it.

This means that the value of the property is considerably lower as I am limited to cash buyers and investors rather than someone looking for a home.

I am in the middle of lease extensions negotiations and it looks like the whole process will cost in the region of £10,000.00. I have taken out a loan to cover this. I know this is more debt but hopefully it will put me in a position whereby if I need to sell the flat it will not cripple me completely. I’ve been looking on rightmove and strongly believe that a good long lease with no ground rent will make the property stand out from it’s competition.

However the downside of increasing the lease is that I will no longer qualify for Housing Benefit as I’m confident I would have more than £16,000.00 equity in the property. The loan will costs me £180.000 per month in repayments and I receive £450.00 per month in Local Housing Allowance. The net loss to me each month is therefore £639.00 per month.

I know that all the benefits I receive will now go as soon as my claims are all rolled into Universal Credit so my reasoning is I  may as well start to live without them now and by doing this it will be a gradual process rather than losing it all in one go.

I’m confident that even with a wife and four children I can mange my finances in such a way that we will still cover all the bills and have around £450.00 per month spare. We live in a nice home and have a great life. I’m positive that by looking to the long-term we’ll get through this in a much better position than we started.

However I’m not going to lie. I am slightly terrified.

Reclaim your Council Tax Charges…is this one for Martin Lewis

In a previous post I mentioned that one of the worst things about working in Local Government is the love of the private sector that senior managers have. They believe that a council is a brand and that we have customers. As I will rant until I am old and grey we are not and  do not.

If they are insisting on being viewed upon as private sector brands then maybe they should behave like them when it comes to the charges they apply to debts.

At the local authority I work for if you miss your Council Tax payment and you are summonsed you will be charged around £50.00 for a letter to be sent to you. If it goes to court then further costs are added.

I’m not doubting that there are costs associated with sending a letter but last time I looked at myself and my other admin drones no one was getting paid £50.00 per letter.

With the introduction of the local council tax schemes many people on Employment Support Allowance are having to pay Council Tax for the first time. In my area it is a low amount of around £3.00 per week. Then again when you have £70.70 per week to cover everything I’m sure £3.00 is not trivial. To charge someone £50.00 for failing to pay around £9.00 worth of Council Tax is immoral.

So. Should local authorities be limited on the amount they can charge people for building up Council Tax arrears? After all the banks they are so desperate to emulate with the call centres and “speedy resolution” can no longer charge extortionate fees.

Why being a Housing Benefits officer is the best job in the world

I live in an area of high unemployment and even higher rents. Things are now at the stage where one in three households in my town are receiving either Housing or Council Tax Reduction. I live in the area I work and I love the feeling as I walk to the office that I am helping one in three of the houses I walk past.

I also love that my family and friends know that when they are in financial trouble they can come to me for advice.

However the flip side of my job is that I need to make sure that money goes to the right people. Occasionally I need to ask questions that people do not like. Usually it is because I think they are withholding information and do you know what…I am usually right.

My rule of thumb is that the louder they complain the more guilty they are and today it proved true. A year ago a couple I had requested information from kicked up a fuss, complained to their M.P and tried to bully me into stopping requesting information from them. I didn’t stop and today they were sentenced to 50 hours community service for neglecting to mention a job which netted them up to £700.00 per week.

So if you receive a letter from a benefits officer don’t assume the worse. They want to help you,  that is unless you are on the fiddle. If you are not only do they want to catch you, the chances are they already have.