UC rent shortfall

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    UC rent shortfall

    My niece who lives in a 5-bedroom HMO has applied for Universal Credit due to being made redundant. The DWP has responded that they will pay her a sum for housing costs equal to 1/5 of the total rent for the house. The problem is my niece's room is the largest and has an ensuite, so she pays more than 1/5 of the total rent. She has already had a discussion with DWP to clarify the situation but now they have come back with this. What can she do? The landlord can't help as the house is leased out for a total sum and it's up to the tenants how they allocate the cost per room and they make one payment via one of the tenants.

    #2
    Originally posted by HazeltonLane View Post
    What can she do?
    Move into a cheaper bedroom.

    Comment


      #3
      Originally posted by Mrs Mug View Post

      Move into a cheaper bedroom.
      Quite. Surely it is up to people to cut their cloth to suit their incomes. If you have less income you move to a cheaper place or a cheaper city before you expect others to bail you out.

      Comment


        #4
        She has lived there for 6 years and is quite happy where she is, thank you.

        She has never applied for housing benefit before but has been made redundant due to her employer going into receivership so needs some help until she finds her next position. (Not that that should have anything to do with your answers!)

        Comment


          #5
          I have seen my income drop considerably since covid19 has been so brilliantly managed by the ....... in charge. Two houses now not paying rent to me currently

          So I've cut back on my expenditure: Simple. Surely that's what anyone with half-a-brain would do?
          I am legally unqualified: If you need to rely on advice check it with a suitable authority - eg a solicitor specialising in landlord/tenant law...

          Comment


            #6
            Originally posted by HazeltonLane View Post
            so needs some help until she finds her next position.
            She has been told about the help that she is entitled too.

            Comment


              #7
              Today's update: my niece has now received advice from CAB and accordingly the landlord will provide an addendum to the tenancy agreement that states the correct amount of rent that each tenant pays. My niece's rent is below the local authority's limit for a single person so she will receive the full amount of her rent from Universal Credit.

              Hopefully this advice might help others who find themselves in a similar situation!

              Comment


                #8
                Thanks for the update.

                Hadn't realised that she wasn't getting the full LHA rate for a single person in a shared house.

                Comment


                  #9
                  No she is around £100 per month below the LHA rate.

                  Comment


                    #10
                    Hazelton I'm glad your niece found a solution - I just wanted to say hats off to you for how you have handled the unhelpful responses.

                    you are a senior member, so you probably seen it all

                    Comment


                      #11
                      Originally posted by fro View Post
                      I just wanted to say hats off to you for how you have handled the unhelpful responses.
                      Responses that were given without knowing all of the relevant facts.

                      Comment


                        #12
                        Originally posted by HazeltonLane View Post
                        the landlord will provide an addendum to the tenancy agreement that states the correct amount of rent that each tenant pays.

                        Hopefully this advice might help others who find themselves in a similar situation!
                        So two points, with three potential consequences:

                        1. The landlord has just changed the entire basis of the tenancy, and potentially voided the agreement/ended it from the date of change. Previously, it was a 5 way joint tenancy. Now, its a single occupancy tenancy agreement (renting a bedroom), with communal facilities. The property is now a HMO. Landlord is now liable for council tax etc.

                        2. The change you've posted is unlikely to help anyone else. What has been done is unlawful and/or void/voidable in landlaw. You can't have a single tenancy agreement for an entire property with joint tenants, with each liable for a specified amount of rent. So one of three things has occurred:

                        1. The original tenancy has ended, and a HMO has been created.
                        2. The change in tenancy specifying individual rental payments is a nonsense and void/voidable, and is therefore of no effect and your niece remains jointly and severely liable for an unspecified amount of the rent upto and inc. 100% the rent/charges etc.
                        3. In changing the tenancy to specify a rental sum to enable benefits to be paid at a certain rate, your niece may no longer be eligible for UC rental payments as the tenancy agreement has been contrived to take advantage of the UC scheme.

                        Perhaps thankfully for your niece/her landlord, the DWP haven't bothered to train UC staff in non-commercial/contrived tenancies, even though the UC regs disallow payments to such tenancies. So no one is going to be any the wiser at the DWP. If however the matter of the tenancy ever comes up in county court, the changes to the tenancy/rental payments, will be considered by the judge and a decision made on whether the change was lawful, and the consequences of that change (HMO etc).

                        Sorry!

                        Comment


                          #13
                          Interesting points.

                          It was already an HMO. In fact the OP states that right at the start:
                          My niece who lives in a 5-bedroom HMO ...
                          The DWP may well see a revised tenancy as being "contrived in order to claim or increase benefits".
                          (In which case any UC-HE paid would be clawed back, and the tenant may be liable for further penalties for fraud).

                          However the addendum to the TA is more of a clarification/formalisation of the rent situation rather than a revision, and it's justifiable in view of the different room sizes.
                          The landlord has not issued new tenancies to each tenant, merely formalised their existing agreement of which room occupant should pay what portion of the total rent for the current tenancy agreement.
                          It's still a joint tenancy agreement, and if one tenant gives notice it still ends the tenancy for them all.

                          So it will be OK with the DWP, and indeed the DWP have accepted it.

                          Whilst the DWP front line staff are well known to be poorly trained the 'Decision Makers' are much better trained (although they still make mistakes).
                          And the UC Decision Makers are red hot on spotting contrived tenancies and denying payment. (Often much too keen, insisting on things that are not required by law).

                          In this case as the question of share of rent had already been considered/decided once you can bet that they carefully scrutinised the new information to judge whether it was contrived or not.

                          Comment


                            #14
                            Originally posted by BobsToaster View Post
                            1. The landlord has just changed the entire basis of the tenancy, and potentially voided the agreement/ended it from the date of change. Previously, it was a 5 way joint tenancy. Now, its a single occupancy tenancy agreement (renting a bedroom), with communal facilities. The property is now a HMO. Landlord is now liable for council tax etc.
                            The property was always an HMO, but if the tenancy has changed as described that landlord would now be liable for the council tax.

                            I suspect that the tenancy agreement now simply contains information about who has agreed to pay what element of the total rent - and that the nature of the tenancy hasn't changed.
                            A joint tenancy agreement is essentially between two parties, the landlord and the tenant - but it is also as agreement between the individuals that comprise the tenant - and a note of who has agreed to pay what is probably helpful, if not relevant to the agreement between the tenant and landlord about rent.

                            But even if the entire basis of the tenancy had changed as described, it would simply be a new set of tenancies replacing a previous tenancy. There's a number of problems that that could cause, but they're not insurmountable,

                            2. The change you've posted is unlikely to help anyone else. What has been done is unlawful and/or void/voidable in landlaw. You can't have a single tenancy agreement for an entire property with joint tenants, with each liable for a specified amount of rent. So one of three things has occurred:
                            I don't think that that's what happened, but even if it was it's not unlawful.

                            1. The original tenancy has ended, and a HMO has been created.
                            That might have happened, but I don't think it has. The HMO status of the property wouldn't have changed, other than for council tax purposes.
                            2. The change in tenancy specifying individual rental payments is a nonsense and void/voidable, and is therefore of no effect and your niece remains jointly and severely liable for an unspecified amount of the rent upto and inc. 100% the rent/charges etc.
                            I agree that the rents being quoted don't change anyone's liability for the full amount of rent, but it isn't of no effect, it just affects the tenants, not their liability to the landlord and may make claiming benefits simpler for everyone.
                            3. In changing the tenancy to specify a rental sum to enable benefits to be paid at a certain rate, your niece may no longer be eligible for UC rental payments as the tenancy agreement has been contrived to take advantage of the UC scheme.
                            That may be the outcome, but as it isn't actually a contrived change, it's been made to overcome a reasonable presumption by the DWP and reflects the true situation.

                            Nothing with the DWP would surprise me, but it should, hopefully have done the trick without any of the dire other consequences that are possible.

                            Welcome to the forum by the way!
                            When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
                            Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

                            Comment


                              #15
                              The tenancy is not contrived to take advantage of the benefit scheme. Intention is relevant and liability has not changed. ­čÖä

                              Comment

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